[zdragnar]

And yet, if you took Blizzard CEO's total pay (from the article, I think around $28 mil) and spread that over the nearly 10k employees, everyone gets an extra $3k, which wouldn't do diddly squat for retention.

Also, losing 40% of growth would be pretty awful for anyone who has company stock (employees, 401ks, investors) especially if that's year over year.

[reb]

The extra $3k might not mean a lot, but knowing your CEO gave $28m back to the workers at his or her own expense? I'd argue that kind of thing is great for retention.

The challenge, obviously, is that CEO pay is a market and the current, insane pay scale has emerged from it. The only way for it to change would be a) regulation (good luck to the enforcers), b) a global moral awakening among CEOs that causes a sufficient majority of them to abandon their salaries willingly (ha), or c) labor unions, where extortion over pay becomes bidirectional (rather than the traditional CEO->Worker shit flow).

In any case, people tend not to care much about CEO pay until the company stops paying workers' bills and keeps padding leadership's massive fortunes. People will accept insane wealth inequality so long as it doesn't come at the cost of their personal livelihood. Easiest way for CEOs to keep making idiot money without political costs: lead well enough to keep your workforce employed and reasonably paid. Literally the bare minimum expected of the title.

[Aeolun]

If I’m being paid about 150% of market average, that’s a win for me, regardless of what the CEO is paying himself.

If I’m paid below average, any cent he makes more than me will build resentment.

[eigenvector]

"CEO pay" is only a market if you believe that having been paid an astronomical amount of money as the CEO of an unrelated company is a prerequisite to being the CEO of, say, Activision. In the past, companies promoted CEOs from within their own longterm management, instead of CEO being some kind of mystical profession unto itself.

[dnautics]

That's very much a market, and you've pointed out exactly what's wrong with it

[briandear]

> knowing your CEO gave $28m back to the workers at his or her own expense? I'd argue that kind of thing is great for retention.

If Tim Cook gave his entire comp back to the company, it wouldn’t be barely a blip on the paycheck. Cook leads over 130k employees and indirectly is responsible for several million more employees of suppliers; his comp has nothing to do with what people get paid. His salary is not even a rounding error compared to Apple and supplier revenues and the value of the company. They could double his pay and it wouldn’t even show up on the radar. Interesting, he doesn’t even have the top compensation at the company.

[skookumchuck]

> is great for retention.

So move to a company that meets your standards. I don't really understand the complaining.

[munk-a]

Just as a note, $3k a year raise for a QA tester making 42k is going to do quite a bit for retention. If 3k seems like nothing then I have a bathroom renovation that I'd love for you to bankroll with your pocket change.

[zdragnar]

Oh I know, I was making less than that when I started my career. My point was I'd be willing to be that for most people, a single raise isn't the straw that breaks the camels back when it comes to whether or not they'd stay at Activision Blizzard. From what I've heard from people who worked there (specifically the Activision side) is that it isn't a place I would want to work myself, and $3k wouldn't be enough to convince me otherwise.

[rhizome]

A single raise? Doesn't the CEO make $28MM every year?

[munk-a]

His math is correct, shifting the annual salary of $28M to lower employees would be a one time raise, if the CEO is getting a raise of $28M every year then it'd equal an annual salary increase of $3k

[rhizome]

You of course are correct. My mistake!

[josephwegner]

The $3k doesn't have to be spent on salaries. In fact, unless Blizzard is having a retention problem (they may be... but I'd guess it's not due to salaries), there's better places to spend that money.

Some estimates say their failed game, Titan, cost about $50mil to develop. If their CEO dropped his salary to a modest $1mil/yr, he could essentially fund a new game every 2 years.

This is of course an over-simplification of the value of money... dollars don't magically turn into hit video games. But they do help.

[rightbyte]

Put in perspective, a CEO pay check can eg. be that of 100 engineers (Volvo Cars CEO).

Lets say the CEO instead got compensated 10x engineers. That would leave 90 extra engineers for different projects. Given how resource constraned everything usually is, that would have a huge impact.

I would say the most important thing with the CEO is that he is not extremely bad. The extra value provided for the 10x to 100x is probably not worth it for the owners compared to risk with less engineers.

[CoolGuySteve]

A better question, and one that gets to the heart of why Blizzard's CEO is overpaid, is why do they need 10k people to make, distribute, and support a few video games?

There are far, far more effecient video game studios/publishers out there.

Nintendo manufactures and ships millions of hardware units in addition to producing/publishing games and they have fewer employees.

[zdragnar]

That is, in fact, why blizzard just laid off 800 people- they were from underperforming sections of the business or, iirc, business they wanted to get out of.

[Fnoord]

"Underperforming sections"? Customer Support rep which gave it his all got fired. Due to such people getting fired there's going to be a gap between community and company. How can that possibly be an "underperforming section"?

[Mirioron]

Because it takes a ton of people to offer support on video games. If you have millions of monthly players then you need a lot of employees to manage the community.

[blattimwind]

> Nintendo manufactures and ships millions of hardware units

I'd expect Nintento to have some ODM/CM like Foxconn deal with all that.

[teamonkey]

$28 mil is in the order of a year's development on a large AAA title. That's quite some opportunity cost.

[hiisukun]

Consider the inverse.

Imagine trying to convince your employees you should appoint a boss, at the top of the company. Everyone will give up $3k, and this one person will make $28 milion a year.

I think losing $3k and gaining $3k are the same - but obviously the perception is different for something you 'have' vs something you might get.

[Fnoord]

That's not Blizzard's CEO, that's Activision-Blizzard's CEO. Blizzard's CEO is J. Allen Brack. Activision-Blizzard just fired 800 of those 10k employees, including employees who were long-time employee. Why? Because Activision-Blizzard didn't reach its full potential even though they made a record profit, and the CEO stays. Something about captains leaving the sinking ship last. Very bad for morale, except it seems to be regarded as "normal" these days (it is not).

[adrianhel]

Or it could be spent on the top 10% and make a huge difference in talent retention.