THQ Details Job Cuts, New Plans Following 'Very Tough Year'
In an analyst call following its financial results
, which saw the publisher drop to a yearly loss, THQ president and CEO Brian Farrell outlined its company-wide plans to restore profitability.
These include a new greenlight process, testing the waters of microtransaction supported free to play games, and layoffs of some 200 employees -- though the company plans to grow its headcount by year-end.
Farrell said in the call that its performance was the "first time in many years" the company did not deliver profit, and noted a number of the challenges THQ faced in 2007.
THQ's 'Very Tough Year'
Aside from a few of its PS3 and 360 releases, particularly Juiced, Stuntman
, being "simply not competitive" and showing "insufficient game quality," Farrell said the year showed the "most crowded market for kids in recent memory," particularly from Nintendo's first party output and music-related games.
THQ also spent too heavily to market next-gen titles Juiced
, said Farrell, and made investments in its studio system that didn't pan out. To rectify the situation, Farrell said the company was focusing on its three new initiatives to turn the company around.
The first of these was to prepare a more competitive slate of titles, as outlined in its financial results. The second was to bring in new management talent to product development, along with a four stage greenlight process that would not let games through until they met key competitive technological and gameplay feature benchmarks.
Finally, new CFO Colin Slade explained that THQ would be realigning its cost structure along four key elements, notably a company wide plan to reduce infrastructure.
In addition, Slade promised the company would be realigning its resources toward more strategic franchises, instituting a new company-wide operating budget, and making sure its product development and marketing dollars were focused more efficiently on its most competitive titles.
Reducing, Growing Headcount
Along with these plans, Farrell said that overall headcount across its various studios around the world would be reduced by 200 staff members, those which Farrell said possessed more "last gen" skill sets focused on platforms like the PS2.
In light of this, though, the executives said that by year end, the company planned to increase its overall headcount from around 2400 at the end of last quarter to just under 2700.
The ramping up at THQ would occur, according to Farrell, around staff in its unspecified "key studios" that are working on "key products" for next-gen platforms.
Future Free To Play
Finally, Farrell was optimistic about its first foray into new revenue streams with the upcoming Asian launch of Company Of Heroes Online
(pictured), a co-production of its Relic studio and China's Shanda, which will be free to play but feature paid microtransaction downloads.
Farrell wouldn't say whether the game would be launched in the West any time soon, but said that THQ did "have those rights" and was investigating potential markets, and added that the company was looking into future products of that nature as well.