Guitar Hero business unit disbanded, True Crime: Hong Kong canceled, Tony Hawk on hold

Once-mighty rhythm franchise's latest installment canned; DJ Hero discontinued; United Front's open-world game also given the chop; no new skateboarding game in 2011; Activision's global workforce being culled by 7%.

Guitar Hero II

Just under two years ago, the Guitar Hero franchise was riding high, having racked up over $2 billion in sales from its various installments. However, the intervening period has seen its fortunes fall, with sales plummeting to the point that the latest installment in the series, Warriors of Rock, sold fewer than 100,000 copies during its debut month last September.

Guitar Hero won't rock in 2011. But will it ever again?

As a result of the franchise's weakening, Activision shut down original publisher RedOctane and hit former developer Neversoft with layoffs. Today, though, comes word that the series may have paid the ultimate price. According to the company's latest financial report, the 2011 installment of the game has been axed, and "the company will disband Activision Publishing's Guitar Hero business unit." The company also confirmed that the DJ Hero series is being discontinued.

The company did not comment on whether there will be another Guitar Hero game sometime down the line. However, in a conference call with analysts after the earnings release's publication, Activision Publishing CEO Eric Hirshberg said that, with licensing fees and music royalties, the company just couldn't make profitable Guitar Hero or DJ Hero games at current sales levels. He also said that the company would continue to fund downloadable content for the series as a way of keeping the current customer base engaged.

[UPDATE 3] Or did he? Now according to a FAQ on the official DJ Hero website, all Guitar Hero and DJ Hero DLC will cease after February's end. "We will release the previously announced DLC track and mix packs for February, but--unfortunately--we will not be able to release new DLC packs beyond what we already have," read the FAQ.

Another series headed for the chopping block is True Crime, a move that comes before the next game in the series, True Crime: Hong Kong, had even hit the market. The open-world crime game had been set to be released for the PC, PlayStation 3, and Xbox 360 later this year. It had been in development at Canadian studio United Front Games (ModNation Racers).

In the same conference call, Hirshberg said that the decision to cancel True Crime was due to the fact Activision feels only top-tier games can be competitive in today's market--and that True Crime wasn't a top-tier game. "To be blunt, it just wasn't going to be good enough," he said.

[UPDATE] Hirshberg also shed some light on the Tony Hawk series during the call, saying there will be "no new music or skateboarding games in 2011." Last December, Activision said it was sticking by the series even though its last installment, Tony Hawk: Shred, sold under 3,000 units during its first week on sale.

[UPDATE 2] When asked by an analyst what the impact of the Guitar Hero cancellation and other decisions would have on headcount, Hirshberg said that 7 percent of Activision's workforce would be cut as a result. CFO and COO Thomas Tippl expanded on that, putting the layoff figure at around 500 people.

For more on what might be the final Guitar Hero game, check out GameSpot's review of Warriors of Rock.

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