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THQ sold UFC license after failing to break even on it
THQ sold UFC license after failing to break even on it
June 7, 2012 | By Eric Caoili

Though the Ultimate Fighting Franchise games appeared to be one of THQ's few successes, the company says it sold the brand's exclusive license to Electronic Arts because it failed to break even on the latest release.

THQ management told Wedbush analyst Michael Pachter that UFC Undisputed 3, which released for Xbox 360 and PlayStation in February, fell short of hitting its break-even point of 2 million copies sold.

That was in spite of UFC Undisputed 3 becoming the third biggest-selling game in the U.S. in February, and THQ previously noting the title received better-than-expected sales. The series' second most recent release, UFC Undisputed 2010, also underperformed.

After holding the exclusive license to publish UFC games for several years, THQ sold the contract to EA recently -- the transfer resulted in an unspecified number of layoffs at THQ's San Diego studio, which worked on the franchise.

THQ will focus now on breaking even on a title-by-title basis by releasing low-cost triple-A titles, such as Obsidian Entertainment's South Park: The Stick of Truth, which will release next March.

South Park requires a relatively smaller investment than other titles due to its simple animation. That project's break-even point is also 2 million units, though the publisher believes it can sell well above that, THQ told Pachter.

THQ also intends to enter the free-to-play market and make it a significant portion of the company's business in the future, particularly with the next generation of home consoles.

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Jack Lee
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I respect a break-even plan as much as the next guy, but they need to also have some titles with a break-even point of significantly less than 2 million copies. Like, 300k copies or so. Get some titles that aren't incredibly expensive out there to bring in some cash flow. At least, that's part of what I think they should do, but what's my opinion, anyway?

Gregory Booth
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Nicholas Muise
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/agreed as well

Saying that South Park requires a relatively smaller investment, then next saying you need to sell 2mil copies to break even on it... how is that possible? And they believe they are going to sell well above 2 million on it?

The wording of "low-cost triple-A title" also doesn't make a ton of sense to me. Are they trying to compete with the high end XBLA/PSN titles or are they going retail with this?

thay thay
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F2P is getting too crowded and only covers one market: PC. THQ should focus on *quality* multiplatform games instead. Darksiders 2 should be a big seller as it will be released on 360, PS3, PC, and wii-u. Hard to believe that a "low budget" game like south pork needs 2 million sales just to break even

Sean Monica
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Ah see I would argue that the F2P market is amazing and only blooming now. The 60$ copy paste game market however I would say is crowded ex. call of duty and madden. There are a ton of F2P games that are great and have cosmetic markets which help them thrive a great example is League of Legends. I think a F2P game for THQ is perfect seeing how they have made some terrible choices. A F2P game is inexpensive mostly and the cosmetic or boots can provide a steady income over time such as new skins or pets being released often.