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THQ's Farrell Aims For Core Market
THQ's Farrell Aims For Core Market Exclusive
March 11, 2009 | By Leigh Alexander




Hoping to return to profitability, THQ CEO Brian Farrell believes the company can gain a foothold in the high-risk -- but high-potential -- core game space.

"With respect to the core gamer, I think it's pretty clear that there is a concentration in the top titles," said Farrell, speaking at Wedbush Morgan Securities' annual conference, in comments listened in on by Gamasutra. "There was an argument over the holiday season -- do you have to be in the top five, top 10."

Many publishers -- including Electronic Arts, to whom THQ has a similar business philosophy -- have observed that polarization in the core audience. "Over a year, if you're solidly in the top four, you can be profitable on these core gamer titles -- but you've got to have one of those top titles for the year," Farrell said.

And the primary trait of a top core title? Quality, says Farrell, again echoing EA CEO John Riccitiello's most frequent refrain. "I'm not sure [Metacritic] is the only thing to look at," said Farrell, "but you've got to have a game that resonates with the consumers and the press."

"We know how to do this," he stated, noting that Saints Row has done 2.6 million units life to date at full price. Farrell says THQ plans to build and launch one to two new brands annually -- "and I think what some people seem to be missing is the breadth and depth of our portfolio," he added.

He noted Red Faction: Guerrilla, the first game in the franchise upcoming for the present console generation after the success of the original on PlayStation 2 and Xbox. And Saints Row 2 is "clearly the number-two open-world game in the category, behind GTA," he said.

Finally: "Warhammer 40k is one brand we should start talking about more. It is a PC-only game -- but from the original Dawn of War game that we built at Relic from the original launch, through expansion through gold edition... we've done about 4 million units life to date on Dawn of War 1."

In February, THQ reported $191.8 million in losses and a 30 percent drop in revenues, prompting a 24 percent staff reduction of around 600 positions. In the last ten months, the company’s share price has fallen from $20 to around $2.

"We've been in this business a long time," said Farrell. "[We've had] 13 years of profitable growth in a row... a return to profitability is top of mind to us. How? With the core gamers, it's matter of focus... fewer but higher-quality core [games]."


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Comments


Ben Hopper
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Ah yes, the core market. "13 years of profitable growth in a row?" I can't honestly name a good game THQ published in that time.

Dru Bagaloo
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To each his own, there is always rotten fruit in a publisher's basket but I for one can't imagine a PC market without THQ's input anymore. What they did with DoW, SupCom, CoH, TQ, Stalker and Frontlines was a decent to great job, a couple of those titles were pretty risky as well. A pity they ditched the chance to follow up on some of those franchises and rather sticked to pure in-house stuff.



Also too bad they never learned the lesson of actually finishing their games before releasing them. Then again, nearly every major PC title suffers from that mentality...

Reed Berglund
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Respectfully, I can't say I agree with this approach. The current state of the economy has shown us that the past 13 years have been inflated, bubble activity. I wouldn't use sales numbers from the past 13 years to project future growth and stategy- look at the equities market.

I think Chris Anderson's book "The Long Tail" described a trend in media that we can't ignore-consumers are seeking niche experiences. Certainly consumers are looking for higher quality content, but they are looking for higher quality content that is relevant to them. Furthermore, core gamers now represent less share in the software and hardware market. In the case of Nintendo, it's tough to ignore their hardware explosion over the past 23 months. I personally own an XBOX 360 (love Xbox live), PSP, and Wii. The Wii has opened up the gaming experience in my household to the rest of the family- kids, wife, mom, and in-laws with an age range of 6-62. The moment my in-laws played the Wii they ran out and bought system and 8 games for their own house. However, the one problem I see with the Wii is the lack of quality content. Our current roster of games (heavy rotation) includes Mario Kart, Mario Party, Raving Rabbids, Wii Sports, and Tiger Woods Golf. We are starving for more content!

Why not diversify and take advantage of an install base that is ripe for 3rd party developers? The "core" gamer market is a tough business to be in these days. It's very noisy and consumers appear to be pulling back spending to focus on their top 1 or 2 titles, saving cash they may have spent on titles further down the list.

Mickey Mullasan
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If they have the resources to compete in the core market, then it would be foolish to not. It it is a difficult space to compete in if you do not have the capital to invest in large content teams and expensive technology. The amount of sales you can make is pretty darn good, because there are so few core games in the year, it is not as saturated as the casual market, and there is a sizable enough audience. Besides the core market is closer to age and interests of the developers making the games so the psychological hurdle is smaller than being innovative for granny and the kids.

Markus Schneider
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Ah..the core market now. Doubt THQ knows what that is exactly. People mentioning quality and core market ere shot there until a year ago. Takes a while to change a 2000 people company. We will see. GO WH40K :)

Walter Lippman
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Once again we have a CEO touting Metacritic as a valid indicator of quality in games. It seems to me that the entirely subjective judgements of a bunch of nobodies, who somehow convert their thoughts into numbers (scores), and who have demonstrably been shown to be subject to pressure from the publishers, are not objective indicators of quality in any way, aggregated or not. Garbage in equals garbage out.

Kim Gill
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wow that first comment is ah ... "slightly uniformed" in my opinion.



I was an artist on COH and COHOF. I would take everyone of the credits I worked on in 13yrs

and trade them for that one COH credit. (THQ published!)



I had the privilege to demo that game at E3 and the feedback was mind blowing.

Absolutely an amazing game- working on a title that your own dev team is addicted to- really says it all.



cheers


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