How did THQ get into such a dire state, and what's going to happen now?
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.
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.
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.
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.
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.
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.
@elessarGObonzo Stalker was published by THQ they didnt make it, most of their games where bargain bin bound pulp games.
@elessarGObonzo all these games you named sucked big time. I only put up with darksiders because I had run out of games to play at the time. Saints row is awesome though
I hope Volition resurfaces with a new Red Faction at some point... one of my favorite series' of all time.
I really hope that Valve will make an exception about their policy against making a licensed product just to save Warhammer 40K.
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.
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 ;)
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.
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.
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!
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. :)
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 Hey, there's a few rumours going around (chiefly that there's been a big bid on Volition and SEGA is looking to snap up Relic) but there's no concrete information out there right now. I think it'll be a few hours before we start to hear anything, but GameSpot will absolutely be following the story so you'll know when we do.
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.
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.
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.
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..
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.
Sony Santa Monica could pick up Darksiders and make it multiplatform.. That would be fvckin interesting.
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!!
Release Company of Heroes 2, release few DLC's for it, map packs, upgrade it and so on. AND ONLY THEN, you can die.
@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.
I don't think R*/T2 would really give Saints Row the respect its earned. When it first came out people were calling a GTA clone, but nowadays Saints Row has really established itself on its own merits. Or they could drop the funnier aspects of SRverse and make it more serious like GTA.
I might be wrong, but it still makes me worried to think about it.
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?
@WCK619 Where it goes really has nothing to do with THQ, its a license, with their current situation, I wouldn't be surprised if the WWE is able to dump them for a new partner.
I wish everyone would donates enough money to THQ for support in Relic and other studios in the THQ.
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.