THQ: What Happens Next?

How did THQ get into such a dire state, and what's going to happen now?

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On January 22 at 14:00 Eastern Time, THQ's assets will be going to auction in a move that will result in the publisher's intellectual properties either being sold individually to the highest bidders, or the entire company going to Clearlake Capital Group for a reported $60 million. The move will herald the final chapter of THQ's slow and public demise, but the outcome will mark one of the most significant signs of just how much the games industry has shifted during the current hardware generation.

The beginning…

THQ was founded by Jack Friedman in April 1990 as a toy company with intentions to take part the burgeoning video game scene. One of its earliest success stories was an adaptation of the movie Home Alone in 1991, with the game developed by Bethesda Softworks on the NES, Sega of America on Mega Drive and Game Gear, and Imagineering Inc on SNES.

Despite its commercial success, the game was not warmly received at the time. "If I had one wish, it would be to visit every Mega Drive owner in person and tell them not to buy this grotesquely over-priced and pathetically under-developed mockery of a game," said Amanda Dyson in her 24% review of the game in issue 3 of Mega way back in 1992.

These were titles you'd never want to unwrap for your birthday, but ones you'd probably end up buying with your leftover Christmas money.
Yet these early successes helped establish THQ's business practices, and for the next two decades the company would focus predominantly on producing low-cost, licensed titles for a mass-market audience. Over the years THQ would snap up the rights to make games for Ren & Stimpy, Where's Waldo?, Wall-E, The Incredibles, Evil Dead, Rugrats, Spongebob Squarepants, My Little Pony, Bratz, Avatar, Alex Rider, Warhammer, Star Wars, and its absolutely crucial WWE license. THQ even saw fit to pump money into surprising cult classic 50 Cent: Blood on the Sand after grabbing it from the list of games dropped as part of 2008's Activision-Vivendi merger.

While the majority of THQ's output has often left something to be desired in the quality stakes, the publisher at least understood - at the turn of the millennium, anyway - its place on shop shelves. THQ games received deep, alluring discounts around the holidays; these were titles you'd never want to unwrap for your birthday, but ones you'd probably end up buying with your leftover Christmas money.

…of the end

Games publishers are almost universally going through a hard time right now, but 2012 was an especially horrible year for THQ. At the start of the year it was almost removed from the NASDAQ stock exchange as its share price had bottomed out to cents from the respectable $30 it was claiming in 2007, hundreds of staff were made redundant, and CEO Brian Farrell took a 50% pay cut. Even Take Two president Strauss Zelnick took some time out (from doing things like appearing on the front cover of Men's Fitness) to publicly declare that "THQ won't be around in six months" in April 2012. Well, at least THQ managed to prove him wrong on that - the publisher might manage nine months.

It was definitely a bad start to the year. And things would only get worse. What, exactly, had gone so wrong with THQ?

Chief among THQ's problems was indubitably uDraw, the console-based graphics tablet that completely flopped at retail. Fussy, unpopular and grossly mismanaged, the only person who really benefited from the epic bungle of uDraw was the landlord charging rent for the warehouses currently housing the 1.2 million unsold units.

uDraw was THQ's attempt to get back onboard the lucrative children's market, an area it dominated in the early noughties but one it lost control of as soon as the Wii came out. Its licensed properties simply weren't selling or were drying up - the publisher lost its arrangement to publish games based on Disney movies - and its attempts to carve out new IP floundered, culminating in the critical savaging of Homefront in 2011. THQ closed developer Kaos Studios shortly afterwards, with the game's 2.6 million shipped units not quite the Call of Duty beater its publisher wanted.

Fussy, unpopular and grossly mismanaged, the only person who really benefited from the epic bungle of uDraw was the landlord charging rent for the warehouses currently housing the 1.2 million unsold units.
The problems keep on coming: its mismanaged attempt to enter the once-powerful MMO genre with Warhammer 40,000: Dark Millennium was cancelled and restructured into a single-player game that's now gone MIA. Plus the publisher's two high-profile IP announcements, Guillermo Del Toro's Insane and Tomonobu Itagaki's The Devil's Third both had their rights transferred back to their respective studios.

Heck, even a tattooist sued the publisher for its replication of Carlos Condit's lion tattoo in the commercial flop that was UFC 3.

It came as no real surprise that, after months of back-and-forth with creditors, THQ's downward spiral continued until the company finally filed for Chapter 11 bankruptcy on December 19.

Speaking in a statement at the time, Brian Farrell said "the sale and filing are necessary next steps to complete THQ’s transformation and position the company for the future, as we remain confident in our existing pipeline of games, the strength of our studios, and THQ’s deep bench of talent."

"We are grateful to our outstanding team of employees, partners and suppliers who have worked with us through this transition. We are pleased to have attracted a strong financial partner for our business, and we hope to complete the sale swiftly to make the process as seamless as possible."

What happens next?

Right now, THQ has three announced games hoping for a swift and successful conclusion to its auction on Tuesday. Those are South Park: The Stick of Truth and Metro: Last Light (both currently pegged for a March release) alongside PC RTS Company of Heroes 2. Even though those games are almost certainly in the final stretches of development, it's no certainty that they'll hit their release dates - last week US retailer GameStop pulled Metro: Last Light from its digital storefront and offered refunds to customers. Speaking to GameSpot, VP Matt Hodges said "due to THQ's current financial situation and uncertainty of delivery, in order to protect our consumers we removed the ability to pre-purchase that specific game."

As part of THQ's bankruptcy, though, the publisher has revealed five more games in production - though we only know the working titles of four at present. Those are Turtle Rock Studios' Evolve, THQ Montreal's 1666, Relic Entertainment's Atlas and Vigil Games' Crawler.

Finally, there's Saints Row 4 - THQ's most lucrative franchise going, and the one most rival publishers will likely be looking to snap up. EA, Ubisoft and Warner Bros. have all publicly expressed an interest in various chunks of THQ's assets ahead of Tuesday's auction. Even Double Fine has expressed an interest.

The THQ name might not survive the next few months, then, but with any luck its current slate of games will manage to see the light of day. Tuesday afternoon, then, looks set to be a big one for the games industry.

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martingaston

Martin Gaston

Hi! I'm Martin, for some reason or another I have managed to convince the people who run GameSpot that I am actually wor
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217 comments
the-mind
the-mind

No, dawn of war license must be saved its  a true rts marvel

vgsak2005
vgsak2005

Growing up I always associated THQ with not so awesome games. I didn't even realize Bethesda developed the NES version of Home Alone. I played the aweful SNES version, unfortunately. I don't know which was worse. It seems like THQ really brought it around though this generation in terms of quality. I bought darksiders. Alot of people liked that game. Even though I was never a big fan, I'm also sad to see Atari going bankrupt. This was a company around from the earliest days of video games. They somehow survived the Jaguar, too bad this might be the end for them as well.

MartinX60
MartinX60

It's sad to see THQ in this mess. I loved some of their games but there was always a game better or more popular game then theirs. It's like as if they had the potential to make very good games but are always 1 or 2 step back. Just enough to either ignore the game because it wasn't popular enough or because other games were better if you ever had a decision between one of their games and another whether it was the same game-type or not.


Even tho they never made a huge hit, I am gonna miss THQ a lot. I'd still wish for a miracle for them.

elessarGObonzo
elessarGObonzo

Metro, S.T.A.L.K.E.R., Darksiders,...THQ has plenty of awesome games. Hard to believe a few flops (new Red Faction for example) could bring them down. I enjoyed Homefront and Warhammer 40,000: Space Marine also, guess they just didnt have enough Halo or Call of Duty aspect to them for the mainstream.

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Sucks that the gaming industry has become as bad as the music industry now: if it isn't some garbage hyped and sold to pop-culture kids it just isn't considered doing well.

GAMBINO85
GAMBINO85

I hope Volition resurfaces with a new Red Faction at some point... one of my favorite series' of all time.

flashn00b
flashn00b

I really hope that Valve will make an exception about their policy against making a licensed product just to save Warhammer 40K.

MVan86
MVan86

Couldn't careless about most of THQ's titles - but I am concerned about what'll happen to Darksiders, perhaps it's not quite up there with God of War but it's still a solid fantasy hack and slash with a good reinvented mythos.

Vishant
Vishant

Enjoyed saints row 3. At least it was an open world game that I can drive in unlike gta. But traded it in after completing it. The whole stable of wwf/wwe titles just got boring and I think people just got tired of the same thing. But we still waiting for that bubble to burst about call of duty ;)

PlatinumPaladin
PlatinumPaladin

Looking at my current collection of games, I realise I don't have a single one from THQ. And now I think about it, I don't think I ever have. How annoying it is then, that now the company and its properties are now in danger, that there are two games (South Park and Metro) that I'd really like to get a hold of. I've been wanting to pick up the Darksiders games for some time now. It's just a shame that THQ have never done anything that is in my mind essential.

RockySquirrel
RockySquirrel

I really enjoyed Darksiders 1-2... solid single player adventure with great art and no way to guess what new challenges were around the corner.

I hope that Darksiders made a good impression on other developers.

gatsbythepig
gatsbythepig

I don't think they ever made a game I enjoyed.

garysingh34
garysingh34

Not really crossed passed with THQ's titles in my lifetime but I'm still really sad to hear this. The more publishers and studios, the better for the games industry and ultimately the gamer!

blackdragon9690
blackdragon9690

it's a bad bad news for me.

Saints Row and Company of Heroes are my favs. and yea, Darksiders.  Don't tell me DardsidersI is bluh bluh bluh..., Yea, i know, i love DmC, LoZ and Portal too. moreover Darksiders II is not another LoZ or DmC.

i just wish they could survive coz they have to release saints row 4. :)

Rattlesnake_8
Rattlesnake_8

It makes me sad, THQ did publish some horrible games like Homefront, but they had some amazing games like Company of Heroes, Saints Row, Metro, the upcoming South Park.. such a shame.

steelmouth
steelmouth

its wedsday where is the update to this

linkndark21
linkndark21

WHAT THE F**K IS GONNA HAPPEN TO DARKSIDERS?


Sepewrath
Sepewrath

THQ made a lot of mistakes, but I think they could have survived if this gen of consoles didn't become completely hostile to mid tier publishers. I really hope this next gen doesn't make the climate worst and further kill creativity.

Granpire
Granpire

The only THQ games I ever had were a few GBA games, mostly licensed. They were mostly pretty bad.

That, and Metro 2033 when it was being given away for free. But that's a no-brainer.

Vambran
Vambran

I never even heard of uDraw before today. What the heck was the CEO of THQ thinking putting so much money into a gimmick console add on. ( nearing the end of it's generation no less )

They never heard of Sega CD ? N64DD? All it does is just shrink the player base. I just hope Dawn Of War 3 sees the light of day after this mess.

BlackBaldwin
BlackBaldwin

I use to like THQ alot back in the day with the first Red Faction and then Saints Row.  Personally I think THQ was just run by a bunch of idiots that took stupid risks that ended up killing the company.  Well I just hope the assets are put into good homes and we gamers will see quality games in the future with them but I sadly have little faith too much in that happening..

Taffy872
Taffy872

I hope Ubisoft gets the assets, hoping it's not EA (I could go without a whole new set of games with an online pass system), and Warner Bros. should just get out go home and don't come back.

Elann2008
Elann2008

Sony Santa Monica could pick up Darksiders and make it multiplatform..  That would be fvckin interesting.

hognut
hognut

This is really a shame, Darksiders 1 and 2 are really great games!! They really should have sold more and gotten the credit they both deserve!!

SavoyPrime
SavoyPrime

I'm definitely interested in 1666 and Crawler. Those must survive!!!

qqxLV
qqxLV

Release Company of Heroes 2, release few DLC's for it, map packs, upgrade it and so on. AND ONLY THEN, you can die.

LordDeArnise
LordDeArnise

 @WCK619 It's not mentioned here, but from what I'm hearing from other sources, WWE '14 is already in development.

I'm sure some of the developers that can survive this will find new homes w/ the remaining publishers.  However, I think Rockstar/Take Two would be a great new home for Volition & the Saints Row Franchise to complement the GTA franchise.  As long as somebody else other than EA take the WWE game licensing, I think that franchise will remain pretty strong.  I'm not sure which publisher would best suit the Darksiders franchise, but Sony, Square, or Konami would be good choices.

WCK619
WCK619

so you define THQ's WWE licence as "absolutely crucial" and then neglect to give any information or even speculate on where it's headed?

commanderxp90
commanderxp90

I wish everyone would donates enough money to THQ for support in Relic and other studios in the THQ.

suplax
suplax

Gamers are to blame , keep buying sh*t games like CoD. Soon the only thing you will find in game store shelf's are overused FPS games. 

WeWerePirates
WeWerePirates

They're not dead yet! Or maybe they are as the auction should have taken place by now but there is no news yet on the result.

It depends what has happened in the auction. If they have been bought out right THQ is in ridiculously strong position. They have several games in the final stretch, all the development costs paid or written off, a bunch of valuable IP (Saints Row likely the most valuable) and all their previous debts gone.

If however the result is the sale of its assets to different bidders then it's more than likely done.

https://twitter.com/DDInvesting

That is the best source of information and a lot of the news articles on THQ has been based on this.

Rougehunter
Rougehunter

I'm hoping the best for Relic. I want them to go in good hands.

JukedSolid
JukedSolid

I remember whenever my parents would buy me some crappy game for my birthday or Christmas, it would always be a THQ game.  I swear that was their primary target demographic with all those movie or cartoon based games.  Idiot parents that don't know what a good vidgame is.  

decoy1978
decoy1978

R.I.P and another part of my childhood goes to the history books. Mismanagement of a good company definitely will kill about 90% of any business. I just hope that their IP's will go to other companies who will let them see the light of day.

Joe_Zombie
Joe_Zombie

I swear, if this prevents metro from being released I'll freak.. as hard as I can

Supabul
Supabul

Activision should buy THQ  and get them working on Call of Duty Map packs

kagento
kagento

Although it looked like THQ was turning for the better, its' failure was easily predicted. Concentrating on new efforts and not having a cracker to support possible inversion risks which they took anyway has led them into a very delicate position. I really hope all the internal studios survive and that their projects continue on. I hope Vigil gets to continue the Darksiders franchise, which could be really big if given a larger push; CoH2 is gonna be awesome, whoever gets the rights for it has a winner; I was actually curious to see what will come out of South Park; and Metro... easily my most anticipated game this next year with Bioshock Infinite.

One question for whoever bothers: Why does EA produce so much hate? All publishers milk the cow one way or another, but some interesting games have come out of EA too.

wizo59mt
wizo59mt

METRO: last light in limbo? how? i already preordered it off amazon and havent got any such notice, that game looks great. so this means THQ games currently slated can be chopped?

Squeets
Squeets

Relic better make it through this unscathed.  Dawn of War is one of my favorite RTS franchises.

BRING BACK BASE BUILDING! BRING DAWN OF WAR 3! LONG LIVE RELIC!

I hope EA can acquire them.  EA Los Angeles + Relic Entertainment + Frostbite 3.0 = Potentially the Greatest RTS in the history of all things.

stefan_931
stefan_931

GOD I reaaaalllyyy hope that Metro and COH2 will make it! COH has got many awards and Metro has just an awsome story!

Squall69r
Squall69r

Better start pooling money so Blackbird Interactive can save Relic from Electronic Arse.

Nova_Prime_85
Nova_Prime_85

shame.... i was really getting into Darksiders aswell...

WeWerePirates
WeWerePirates

THQ's bankruptcy turned into a colossal cluster fuck. All the signs were that it was strategic move to shirk some debts but failure to get their creditors on board beforehand has meant they've ended up in a situation where it could be sold piecemeal. I know that it was rather unethical but I hope Clearlake's bid beats the collective bids to break up the company, for sake of THQ's employees. We'll probably find out tomorrow.

toderascu23
toderascu23

if EA buys the saints then you know it's over. They'll ruin the game like they did with many others.

tizmond
tizmond

While it's a shame to see a big publisher going under with people losing their jobs, THQ's biggest problem in recent years has been a complete lack of originality. I've been reading a lot of the comments on here mentioning games like: Saints Row, Metro & Darksiders. The problem with these games, while they are good, there's just better games that came out first. Saints Row - GTA. Darksiders - God Of War. Metro - Fallout. I can't really comment on Warhammer too much, because I haven't played them, but with other RTS game like Starcraft & MMO's like WoW on the market, it must be hard for them to compete. Although Warhammer does have a big fanbase, so it'll probably get sold to someone else and the games will continue to get released. Judging by the comments, lets all hope it's not EA. I wouldn't mind Ubisoft getting hold of Saints Row & Darksiders though.

wizardboyus
wizardboyus

will dow retribution multiplayer be gone???

emersonA2
emersonA2

I Just Want Darksiders And Saint Row Survive From This Please Ubisoft Buy Darksiders and Saint Row Rights We Need This Two Games Running

IshikawaS9
IshikawaS9

Heres my question, will the DoW 2: Ret servers still continue to run? 3/4 of my 100 or so steam friends all regularly  play ret, will be absolutely devastated if the servers are shut down.

JohnBasedow1
JohnBasedow1

If anyone is wondering who would be stupid enough to buy stock in this company, I must admit to being that guy.  Apparently playing games and knowing how to invest your money have no relationship.  Sh_t