Video game publishers are often criticised for a lack of imagination in concentrating on blockbuster sequels, but it seems that’s about all gamers are prepared to pay for in these recessionary times.
Electronic Arts cut jobs and its forecasts last week as it reported that consumers were concentrating on its frontline titles and neglecting middle-tier ones and older catalogue games.
Today, THQ announced a major restructuring, with cancelled titles, five studio closures and 250 job losses – about 17 per cent of its workforce. It said it was now focused on producing a core number of high quality games.
Brian Farrell, chief executive, reported softness in sales of catalogue titles and a cautious retail environment. The kids licence business – THQ makes titles based on Nickelodeon cartoons and Disney Pixar movies – had slowed considerably and become less profitable, he said.
Activision Blizzard, now the biggest player in the sector since the merger with Vivendi’s games division, seems in the best position.
It has its biggest ever slate of AAA titles for the holiday season, it said today, including World of Warcraft’s Wrath of the Lich King, two Guitar Hero titles, Call of Duty: World at War and a title based on the James Bond movie, Quantum of Solace.
Even so, there was a quantum of reserve in the remarks of chief executive, Bobby Kotick.
“We remain cautious given the likely slowdown in consumer spending this holiday season,” he said, adding “This is the most uncertainty that we have ever experienced.”
