After developing the first two Guitar Hero titles, the studio moved onto Rock Band with MTV when Activision chose Neversoft to continue the franchise.
"When we were buying Guitar Hero, or buying Red Octane, the makers of Guitar Hero, we knew about Harmonix," CEO Bobby Kotick told attendees at DICE, according to Kotaku.
"We had always known them as sort of somewhat a failed developer of music games. They always had really great ideas but nothing that was really commercially viable until Guitar Hero. And [we thought], it's a good piece of software, and if we gave it to [Activision-owned Tony Hawk development studio] Neversoft, they'd knock the ball out of the park with this.
"We really didn't even think, 'Hey we should go to Boston, and meet these Harmonix guys and see what they're up to.' And, of course, if we had gone up, I think the world of Guitar Hero would have been rewritten. It would be a lot different today. And it would probably be a profitable opportunity for both of us and an opportunity where you'd have even more innovation in the category.
"A lot of times when you get caught up in the financial details of the business, it makes you overlook what's really important, which is who's passionate, who's committed, who's inspired and where's the next idea going to come from."
The rival studios have had several spats over the years, such as a period of incompatibility between their instruments.
Neversoft's most recent release was Guitar Hero 5.