Future of THQ is in question...

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Broken by Kevin Dent on twitter. (Game industry finance dude.)

He claims that THQ is probably pretty much broke based on their current actions. They have quietly cancelled any projects from 2014 or beyond, including their Warhammer 40k MMO being made by the Darksiders guys. They have returned the Disney IP they just recently paid for, forfeiting the advance they paid. The assumption is they plan on trying to get purchased by another company.

What happens to Relic, Volition, Vigil, Crytek's Homefront 2, or the recent creation of THQ Montreal that includes all those head honchos they poached from the Assassin's Creed team is all up in the air right now. Interesting times for the start of 2012.

Wow. I hope Relic winds up okay... I was looking forward to DoW3 or a new Company of Heroes.. aw jeez this is awful

Back in Fall, I visited Montreal for the first time. Our hotel was downtown and pretty much right next to it was THQ Montreal in a pretty fancy building right there on what seemed to be the "business boulevard". If all their offices are off that caliber, no wonder they are out of money.

That bums me out, they have made a lot of cool games over the past 3 or so years.

Want...Space....Marine....Two.....

Blind_Evil wrote:

That bums me out, they have made a lot of cool games over the past 3 or so years.

Seemed like every other game I played this year had a THQ logo on it. Did they overreach?

Dude. Don't tell me that. I want my Company of Heroes 2 and DOW 3. Please let someone pick them up because I really, really, really want those games.

LobsterMobster wrote:
Blind_Evil wrote:

That bums me out, they have made a lot of cool games over the past 3 or so years.

Seemed like every other game I played this year had a THQ logo on it. Did they overreach?

Possibly, but they may have had to because of their size. I actually think their big franchises, both good and bad, underperformed. They put a lot of money into Space Marine and it didn't do gangbusters, nor did Saints Row 3. Their annual wrestling game wasn't well received, Red Faction: Armageddon was a failure in every sense. I've had a sense that this'd happen to one of the big publishers sooner or later. We celebrate how cheaply we can get games so close to launch now without pause to consider the effects that can have on business. I've banged that drum in a few different threads, but nobody makes that connection when studios close. The usual response is that they should make games worth full price. If Saints Row 3 isn't worth $60, what is?

I can't think of a viable solution to the issue, and I don't think everyone should feel obligated to pay more than they are comfortable for games. Maybe publishers and retailers should agree to prolong a game's stay at full price? The cost of making large-scale games is also crazy high, and this is likely another reason that platform holders and third parties seem hesitant to get rolling on the next generation.

Blind_Evil wrote:

Maybe publishers and retailers should agree to prolong a game's stay at full price?

Price fixing and maybe collusion? That would border on illegal.

If publishers don't want to lower the costs, don't sell wholesale for prices that low to the resellers. An make products that people want to play badly enough on launch that they'll pay higher prices.

Part of that's what's driving the "multiplayer in every game" mind set.

No offense, but f-ck CoH; I want more Volition / Saints Row (even though SR3 was my first purchase of the series). Those guys most certainly deserve to be kept funded. If that means I have to buy every DLC for SR3, I may do just that.

Edit: SR3 Season Pass purchased!

So the WH40K MMOG is cancelled? While it had a 90% chance of being just another clone MMOG I was hopeful on that 10%..

Blind_Evil wrote:
MannishBoy wrote:

If publishers don't want to lower the costs, don't sell wholesale for prices that low to the resellers. An make products that people want to play badly enough on launch that they'll pay higher prices.

What games last year made you want them enough to pay full price? That logic doesn't work if nobody wants to pay full price for anything ever (because they know how fast stuff drops), which you said yourself is what the current state of things encourages. How many games did you buy for full price last year? For me it was maybe eight, and I know I'm at the high end of that spectrum. It's a hard problem to solve and hopefully someone figures it out, otherwise I remain concerned for the direction of the games business.

You should really only remain concerned for the direction of the AAA games business. People don't want to pay $60, not full price. Granted, some people won't even buy $10-$15 games until they're on sale but it's a much smaller amount of people.

I guess we'll see how this turns out.

I'm willing to bet Volition and Relic will land on their feet but it will be interesting to see how THQ breaks up in the event that it does.

MannishBoy wrote:

If publishers don't want to lower the costs, don't sell wholesale for prices that low to the resellers. An make products that people want to play badly enough on launch that they'll pay higher prices.

What games last year made you want them enough to pay full price? That logic doesn't work if nobody wants to pay full price for anything ever (because they know how fast stuff drops), which you said yourself is what the current state of things encourages. How many games did you buy for full price last year? For me it was maybe eight, and I know I'm at the high end of that spectrum. It's a hard problem to solve and hopefully someone figures it out, otherwise I remain concerned for the direction of the games business.

MannishBoy wrote:

Price fixing and maybe collusion? That would border on illegal.

You're right, I gave that blurb very little thought. Still, Nintendo does alright by sticking to the full MSRP for long stretches and not hitting the panic button. How can they afford to do that? A less business savvy audience?

I don't know how the games retail works, who takes the hit in situations where you have brand new games around Thanksgiving being reduced to $30 or $40. I take advantage for sure, but if getting Saints Row 3 for $40 means I'll never see the fourth, hmm.

MannishBoy wrote:

Sorry, I'm still not in the camp of thinking I need to feel guilty for game prices to the point where I want prices to be forced to certain levels any more than they already are.

I'm still not saying you should feel that way, I said so in my first post. I'm just expressing my concern.

MeatMan wrote:

No offense, but f-ck CoH;

You cut me deep, Sir.

CoH is the greatest game ever made. Ever. Really. It's my number 1 game of ALL EFFING TIME! It's an insanely good game and if THQ goes under, I just want Relic to be well looked after and bought by another publisher to let them continue the good work.

Blind_Evil wrote:

What games last year made you want them enough to pay full price?

BF3 (bought on two platforms). Halo Reach. Gears of War 3. Forza 4. Skyrim if I hadn't had a huge backlog. I would have probably bought DA2 for full price if they hadn't annoyed me with the free content only if you pre-order really, really early thing.

And who says "full price" is the right price for the most profit? $60 is too high for some "AAA" titles, possibly not high enough for others.

Sorry, I'm still not in the camp of thinking I need to feel guilty for game prices to the point where I want prices to be forced to certain levels any more than they already are.

TheGameguru wrote:

So the WH40K MMOG is cancelled? While it had a 99% chance of being just another clone MMOG I was hopeful on that 1%

[size=8]Edited for joke...[/size]

You are the 1%!

(/lame internet joke)

Blind_Evil wrote:

I've had a sense that this'd happen to one of the big publishers sooner or later. We celebrate how cheaply we can get games so close to launch now without pause to consider the effects that can have on business. I've banged that drum in a few different threads, but nobody makes that connection when studios close. The usual response is that they should make games worth full price. If Saints Row 3 isn't worth $60, what is?

I disagree with some fundamental assumptions in this statement. I absolutely believe that Saints Row 3 is worth $60. I say that from a fairly well-informed place, since I played the game through to completion and loved it. Before I bought it, though, I had no way of knowing that was the case. I had nothing to lead me to believe that it would be any more or less than the first two Saints Row games, which is to say middle-of-the-road GTA knockoffs with some potty humor, except for some strong word-of-mouth from forums like this one and a couple podcasters I trust which led me to take a chance. Millions of gamers out there don't read forums or listen to gaming podcasts and would have had no way of reaching the conclusion that it was worth their time or money to take that same chance.

SR3 came out at a ridiculously crowded time of year, and dropped in price ridiculously quickly. The gaming public didn't make those decisions. THQ did. They could have released it at a time (like, say, right around now) when it would have been the hottest thing on the release calendar. Instead, they sent it to die sandwiched between giants like Skyrim, Assassin's Creed, Halo, Zelda, and Mario. They could have seen the positive word-of-mouth and kept it at a higher price longer. They didn't.

If they drop the price to bargain-basements levels by the time I'm done with the million other games that were higher on my priority list last fall and ready to take a chance on something relatively unknown to me, then what am I supposed to do, put an extra $10 in an envelope and mail it to them? Well, in fact, that's pretty much what I DID do in the form of buying DLC that I didn't particularly want or need solely because I wanted to support such an awesome game. But I tend to think that action is pretty rare in the marketplace at large.

I feel like I've done a reasonable amount to support a game I love, but THQ's bad business decisions are no one's responsibility but THQ's.

hbi2k wrote:

SR3 came out at a ridiculously crowded time of year, and dropped in price ridiculously quickly. The gaming public didn't make those decisions. THQ did. They could have released it at a time (like, say, right around now) when it would have been the hottest thing on the release calendar. Instead, they sent it to die sandwiched between giants like Skyrim, Assassin's Creed, Halo, Zelda, and Mario. They could have seen the positive word-of-mouth and kept it at a higher price longer. They didn't.

Very good point. I'm really surprised the last few years haven't taught more lessons like that. EA seems to have learned a little.

hbi2k wrote:

...the first two Saints Row games, which is to say middle-of-the-road GTA knockoffs with some potty humor...

Hey, hey. Did you play SR2? I didn't see a very big leap in quality or mechanics between 2 and 3, just a difference in scale.

Other than that, you're spot on. I don't see the wrong assumptions that I made, though. SR3 was just an example pulled from THQ's stable.

Again, I'm not trying to point fingers, even if it seems that way. This is a problem in the macro of the business, a problem that needs solving by people smarter than I. If the solution is studio closures and the sale of intellectual properties, so be it. But you get a lot of poor, helpless, puppy-dog-eyed BlackSabres concerned for the future of their favorite franchises that way.

hbi2k wrote:
Blind_Evil wrote:

I've had a sense that this'd happen to one of the big publishers sooner or later. We celebrate how cheaply we can get games so close to launch now without pause to consider the effects that can have on business. I've banged that drum in a few different threads, but nobody makes that connection when studios close. The usual response is that they should make games worth full price. If Saints Row 3 isn't worth $60, what is?

SR3 came out at a ridiculously crowded time of year, and dropped in price ridiculously quickly.

Currently $60 for Xbox 360 at GameStop and Best Buy

Currently $60 for PS3 at GameStop and Best Buy

Currently $50 on PC (Steam)

You were saying?

Sure, it was discounted at 33% off for one day during the Steam winter holiday sale, but I don't see how you could make such a statement based on just that.

It was on sale for $30 plus the season pass pretty quickly (on Amazon, if I remember right), but that doesn't change your point much.

I'm actually curious about sales like that and how much of a percentage of total sales they make up. People that follow CAG and the deals threads on here might think it's common sense and common practice to wait for the inevitable Steam/Amazon/Brick and Mortar sale but that could be a pretty small minority of game buyers.

Yeah, I didn't see it, but I'm guessing that Amazon deal was similar to that Steam sale, meaning that it was a one-off, one-day (or a few days) holiday special.

I interpreted the original statement to mean a universal price drop in MSRP, which obviously has not happened yet for SR3, and rightfully so.

This is sad news. THQ has the habit of launching interesting games. I'm concerned about what will happen if they get bought by EA or Activision.

Time to update my lottery win wish list:

1. Buy Relic and bankroll Homeworld 3
1. 2. Pay off student loan
2. 3. Buy a home

cyrax wrote:

And now a response.

I hope that's the truth.

Gotta say...

“THQ has not cancelled its 2014 line-up, and has not made any decisions regarding the planned MMO,

... doesn't exactly have convincing vibes to it. You'd think they'd simply say that the rumours aren't true and that they have no intention of selling off the game if that wasn't the case.

Spunior wrote:

Gotta say...

“THQ has not cancelled its 2014 line-up, and has not made any decisions regarding the planned MMO,

... doesn't exactly have convincing vibes to it. You'd think they'd simply say that the rumours aren't true and that they have no intention of selling off the game if that wasn't the case.

They haven't said much beyond that they're making one, though. It's hard to confirm or deny a complete lack of information.

And who says "full price" is the right price for the most profit? $60 is too high for some "AAA" titles, possibly not high enough for others.

This is a good point.. its fair to say that the current AAA model is broken is various ways... notably price. I would probably offer up that a few AAA titles have enough legs to warrant a higher than $60 price tag (and by all evidence this is how publishers view DLC) Afterall a few subscription based games have been highly successful at getting $60 and then $15 a month out of people (though not many have succeeded here)

Freemium and F2P with micro-transactions are probably a good model even for AAA games. We just need someone like Blizzard to fully adopt it and succeed to see that model really take off in the West.

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