Maybe they could make an action game like Devil May Cry but with something like a rhythm game element to it. Do they have any existing IP that that could fit? Or a team that could make it?
The article says that the "new" group is just mostly King (the developers of Candy Crush Saga) employees, and they will basically be working on Activision/Blizzard IP, it doesn't say anything about them working on general Microsoft IP. It is likely Activitions massive back catalogue may finally have some games make a comeback.
This... is actually kind of exciting. Two massive studios (potentially) showing they also feel that the current AAA space is saturated with boring, soulless, samey games, year after year.
Make StarCraft 1 again...but like the same thing but different ya know? Kinda like just give me a pill to forget about StarCraft so I can replay it and disassociate for a while.