Author Topic: THQ in financial crisis?  (Read 4109 times)

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Offline Ace

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THQ in financial crisis?
http://www.kotaku.com.au/2012/02/how-thq-went-from-bad-to-very-bad/#more-488321

Quote
In 2007, shares in publisher THQ were going for over $US30 a piece. Today, in 2012, they’re going for around $US0.70. Studios are rumoured to be on the chopping block. Over 200 employees are being let go. And the company’s boss has taken a 50 per cent pay cut.

How’d it all go so wrong?

Easy. THQ has been one of the most poorly managed publishers in recent memory. What was once a troubled second-tier publisher (in 2008 it closed five studios and sold a few more off) got it in its head a few years ago that it wanted/needed to compete with the big boys, the EAs and Activisions of the world, and figured the best way to do that would be to spend money. A lot of money. Blockbuster money, the kind of money it couldn’t back up with blockbuster games.

So, naturally, things went wrong.

...

Red Faction. A few years ago, THQ brought back the Red Faction franchise with Guerilla, an open world game with a robust physics engine. It had its problems, but it sold well, reviewed well and had a lot of promise for a sequel. That sequel, Armageddon, proceeded to improve nothing, and indeed in many ways removed the best bits of Guerilla. It was so poorly received that it contributed to the premature shelving of the entire franchise, only a couple of years after it had seemed on the cusp of bigger things.

Red Faction, Part Deux. Oh, but it wasn’t just the games world where THQ blew it with Red Faction. It also thought it would be a good idea to make a TV show about it. Not one based on the awesome Guerilla, though. It made one based on the awful Armageddon. The show was equally awful, which is why you probably never saw it, or had even remembered it existed until now. Sorry. Way to blow a franchise’s chances at multimedia cross-over, THQ!

...

Homefront. A disaster. THQ marketed this game as a serious contender to the military shooters coming out of Activision and EA. The thing is, Activision’s shooters are made by Infinity Ward and Treyarch. EA’s are made by studios like DICE. THQ’s shooter was made by…the guys behind Frontlines, a pretty average… strategy game. Homefront did a few neat things, especially in multiplayer, but it was a short, linear, boring and occasionally stupid/insulting game. The gulf between the amount of marketing behind the game and its eventual quality perhaps best sums up THQ’s problems of late; namely, you can’t just throw money at bad games and hope that’ll make them better.

...

Warhammer. Another example of THQ not really understanding a licence, or its market potential. Warhammer 40K is a storied franchise, one that’s very popular in Europe, but it’s not so big in the US, limiting its global appeal. To have stuck Relic — one of the world’s premier developers — on the licence for so long is like grinding metal. The Dawn of War games, and even the latest Space Marine title, were always going to hit a glass ceiling because of that licence.

Because of these and other missteps, the recent history of THQ reads like a stab victim slowly bleeding to death. Since recording massive earnings in 2006-07 on the back of licensed kids games, THQ has closed five internal studios (2008), sold another (Big Huge Games, 2009), sacked developers in both the US and UK (2010), cancelled an online WWE game and closed its Korean outpost (2010), sold its mobile business (2011), closed two more studios (Homefront developers Kaos and THQ Warrington), killed the Red Faction franchise (2011), closing two more internal studios (Blue Tongue and THQ Australia, 2011) and killed its MX vs ATV franchise (2011). This year, its sacked 240 employees and been threatened with expulsion from the Nasdaq stock exchange, and also faced accusations it cancelled its entire 2014 lineup, along with the cancellation of the long-in-development Warhammer 40K MMO.

So, what’s the problem? Why all the closures? It keeps coming back to the argument that it’s all management’s fault. Many of the studios above made good games that sold pretty well! Yet there’s a delusion on the part of THQ, and you see it everywhere from its marketing spend to the size of its booths at trade shows to the licenses it spends millions on, that its games are awesome, and that they sell millions. Which they don’t.

Or maybe Volition is cursed! First Interplay, now THQ!  :P

The worst part is that the studio meddling is apparently what caused a lot of the problems with the last Red Faction entries...
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Offline Mongoose

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Re: THQ in financial crisis?
Speaking of this topic, one of the :v: guys has a rather stupid take on used games.

 

Offline deathfun

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Re: THQ in financial crisis?
Speaking of this topic, one of the :v: guys has a rather stupid take on used games.

That's quite an interesting opinion actually

As for THQ going kaputz, well... they shot themselves in the foot. What else would you expect?
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Offline headdie

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Re: THQ in financial crisis?
Speaking of this topic, one of the :v: guys has a rather stupid take on used games.

Actually it's not so stupid.  the second hand games market competes directly with new games because within a week of a game coming out you can reliably find second hand copies on the shelves for £5-10 cheaper than a full priced game.  The publisher and developer sees no profit from second hand sales and every second hand game bought is 1 less new copy of that game sold, to a publisher and developer's bank balance it is no better than piracy and its the bank balance that keeps a company afloat.
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Offline NGTM-1R

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Re: THQ in financial crisis?
On the other hand it got me some really awesome Warhammer games to play, so I'm cool with that.
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Offline Mikes

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Re: THQ in financial crisis?
And there's one good thing about that whole mess: The Warhammer 40k MMO got canceled (thank god), so at least  that franchise is (for now) safe from becoming an MMO embarassment.


Just let Relic do Battlefleet Gothic already and I'll be happy... lol.
« Last Edit: February 07, 2012, 01:05:50 pm by Mikes »

 

Offline Dragon

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Re: THQ in financial crisis?
TBH, it's hardly surprising that THQ is having financial problems, as it made plenty of bad games in a time in which people started to be careful about their money, not to mention general financial climate is bad for pretty much everyone. Many game studios are closed these days, a lot of different companies went bankrupt. And even politicians were getting pay cuts, or at least talked about it. I only hope DoW franchise keeps going.

 

Offline Mongoose

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Re: THQ in financial crisis?
Well, I'm not saying that the general GameStop practice of buying a week-old game from someone for $20 and then putting it back on the shelf next to new copies for $45 isn't really scummy, because it is.  I've pretty much stopped shopping there because of that.  However, my concern is more for the long-term.  I only get around to a lot of games a few years (or more) after they're released, so a significant part of my non-Steam game collection comes from digging through used bins for previous generations to find good stuff I missed when it was new.  (One or two game stores near me have used titles going all the way back to the Atari 2600, which is awesome.)  If the industry's major players start widespread implementation of anti-used measures now, what's that going to mean for me in a couple of years, when I'm looking to pick up older titles?  That's what worries me, and that's why I can't agree with opinions like in the link.

 

Offline Goober5000

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Re: THQ in financial crisis?
Actually it's not so stupid.  the second hand games market competes directly with new games because within a week of a game coming out you can reliably find second hand copies on the shelves for £5-10 cheaper than a full priced game.  The publisher and developer sees no profit from second hand sales and every second hand game bought is 1 less new copy of that game sold, to a publisher and developer's bank balance it is no better than piracy and its the bank balance that keeps a company afloat.
Rubbish.  Nobody is entitled to rewrite the laws of economics just because he doesn't like them.

The exact same thing happens in used car markets.  The solution isn't to prevent people from buying used cars, it's to make buying a new car an attractive option.

 

Offline headdie

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Re: THQ in financial crisis?
Actually it's not so stupid.  the second hand games market competes directly with new games because within a week of a game coming out you can reliably find second hand copies on the shelves for £5-10 cheaper than a full priced game.  The publisher and developer sees no profit from second hand sales and every second hand game bought is 1 less new copy of that game sold, to a publisher and developer's bank balance it is no better than piracy and its the bank balance that keeps a company afloat.
Rubbish.  Nobody is entitled to rewrite the laws of economics just because he doesn't like them.

The exact same thing happens in used car markets.  The solution isn't to prevent people from buying used cars, it's to make buying a new car an attractive option.

and then gamers complain that new content, or certain features are only available to those who bought a new copy.
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Offline Dark RevenantX

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Re: THQ in financial crisis?
My 1997 car with 155,000 miles on it that I bought for $3,000 gives no money to Honda.  But it's much degraded from buying a new 2011 car with 250 miles on it that I could have bought for $22,000.

The $45 used copies of the games you buy are completely identical to the $60 new copies you could have bought.  The developers don't see any of it, and you see no degradation for buying used.  The exception is DLC and, in some cases, game passes for content, which actually does offer a form of degradation.

 

Offline Aardwolf

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Re: THQ in financial crisis?
Barely on-topic:

I was going to apply for a job at THQ, but their online interface said something to the effect of "we don't support Firefox, use Internet Explorer 5 or Netscape Navigator". So I didn't bother. I don't want to work at a company run by Neanderthals.

 

Offline Mongoose

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Re: THQ in financial crisis?
Nice to know they haven't touched their site in ten years. :lol:

 

Offline Dragon

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Re: THQ in financial crisis?
My father once used Netscape, it was a nice browser. About 10 years ago.  :)
It's especially funny since Firefox is descended from NN (IIRC).

 

Offline Black Wolf

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Re: THQ in financial crisis?
Rubbish.  Nobody is entitled to rewrite the laws of economics just because he doesn't like them.

Boom, right there. The "debate" in a nutshell. If any other industry tried this kind of thing, they'd be laughed at. Imagine some Ikea rep coming to your garage sale and telling you you couldn't sell your chairs because they weren't getting any money from them?

If I buy a disc, whether it's a movie, music or a game, it's my property. If I wish to sell that disc to someone else, that's entirely within my rights and one of the basic tenents of capitalism. Now, admittedly, the game companies aren't exactly obligated to support whoever I sell it to in the form of DLC, patches etc., but it'd be a bit of a massive dick move if they didn't, and rather nonsensical if it's paid DLC, which they receive 100% of the money for.

But all that's window dressing. Ultimately, it's my disc and I'll do what I bloody well want with it.

With regards to THQ's financial problems, well, it shouldn't affect [V] too badly. If they go down the gurgler, [V] will be sold off as a unit - they've made some very profitable games of late (most notably Saints Row) and they're a valuable asset. The only thing it does mean is that THQ are even less likely to authorize any kind of risk taking project from [V], like I dunno, an attempt to reinvigorate a near dead genre by reviving its greatest franchise. But given that that more r less just decreases the likelihood of a FS3 in the next few years from 0.1% to 0.05%, I can't say it's affecting me too badly. :p
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Offline Hades

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Re: THQ in financial crisis?
Rubbish.  Nobody is entitled to rewrite the laws of economics just because he doesn't like them.
Boom, right there. The "debate" in a nutshell. If any other industry tried this kind of thing, they'd be laughed at. Imagine some Ikea rep coming to your garage sale and telling you you couldn't sell your chairs because they weren't getting any money from them?
And there's the flaw in that thinking. Comparing something digital, that does not degrade with use nor time, to something tangible that you can feel, which does degrade with use and time.

Which is why someone who'd not have second thoughts about buying a used movie or show may think second thoughts about buying a used chair because it'd be in poorer condition than the new thing.
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Offline Eishtmo

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Re: THQ in financial crisis?
THQ is on the verge of being delisted from the stock market.  If that happens, the company is done.  Volition and the other developers under it will be sold off to pay debts.  THQ as a company will go the way of Interplay.
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Offline Black Wolf

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Re: THQ in financial crisis?
And there's the flaw in that thinking. Comparing something digital, that does not degrade with use nor time, to something tangible that you can feel, which does degrade with use and time.

Which is why someone who'd not have second thoughts about buying a used movie or show may think second thoughts about buying a used chair because it'd be in poorer condition than the new thing.

I understand that position, but I still dismiss it. If they don't like the second-hand market, then they should start making sandwiches or something perishable. It's simply a reality of their industry that they have to deal with, and it ought to be by incentivizing people to hold onto their games, either with DLC, quality multiplayer or by making it enjoyable enough that people might want to play through the singleplayer again at some point in the future.
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Offline headdie

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Re: THQ in financial crisis?
indeed if you have the money to buy a new car, most people dont instead try to save money by buying the 3 yr old model of that car because in all likelihood it wont be as reliable and will probably not have some of the features of the newer car.  with software this is not the case, short of special editions a 3 yr old version of the game will have all the same reliability (so long as the disks are ok in the case of software stored on recordable media) as a brand new copy, this in itself warps the traditional idea of capitalism which is founded on physical objects not entities that we cant see or touch.

also when you read the T&C supplied with 90% of software you dont own the software, only a licence to use it.

THQ is on the verge of being delisted from the stock market.  If that happens, the company is done.  Volition and the other developers under it will be sold off to pay debts.  THQ as a company will go the way of Interplay.

Yer I read that too, a shame really as THQ was one of the better publishing houses
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Offline Flipside

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Re: THQ in financial crisis?
Rubbish.  Nobody is entitled to rewrite the laws of economics just because he doesn't like them.
Boom, right there. The "debate" in a nutshell. If any other industry tried this kind of thing, they'd be laughed at. Imagine some Ikea rep coming to your garage sale and telling you you couldn't sell your chairs because they weren't getting any money from them?
And there's the flaw in that thinking. Comparing something digital, that does not degrade with use nor time, to something tangible that you can feel, which does degrade with use and time.

Which is why someone who'd not have second thoughts about buying a used movie or show may think second thoughts about buying a used chair because it'd be in poorer condition than the new thing.

You could argue, though, that the degradation is retrospective, a game that is 10 years old will not look anywhere near as good as a modern game. Whilst it is true that, strangely enough, the gameplay would have changed little, even Distributors wouldn't be so silly as to put old games on sale at full modern day prices. That's where my problem with the current war on the second hand market stems from, the fact that re-releases are not assured, especially in this climate of failing companies as this thread shows. There's even talk of the new member of the X-Box series to be designed for a single activation of a game under a single user-name, so it will not play used games at all. Whilst I can, sort of, understand this at the level of the first 6-months to a year of release, it sort of negates the point of degradation if the material involved is that young, be it chairs or computer games, and actually pulls the industries' argument of games being art off track and turns them into being a consumable, because they have no public legacy.