Publisher THQ announced it would be refocusing its Juice Games and Rainbow Studios on digital distribution -- and cutting 60 jobs as part of the strategy.
Juice Games will now be known as THQ Digital Studios Warrington, while Rainbow will be re-titled THQ Digital Studios Phoenix. According to the publisher, the studios' core mandate will now be to create digitally-distributed games based both on owned and new IP.
The first of these will begin releasing in 2011; the two studios are developing downloadable games for Xbox Live Arcade, PlayStation Network, iPhone and iPad. THQ says it will still publish its MX vs ATV sport racing franchise under the Rainbow Studios brand.
Notably, the publisher also says the studios will be tasked with implementing "a portfolio-wide community platform to connect consumers to all of THQ’s core games using proprietary technology developed by THQ Digital Studios Warrington."
"Consumers are increasingly looking for deeper engagement with their favorite entertainment experiences," says THQ executive VP Danny Bilson. "They also want to enjoy games and entertainment via convenient social and portable platforms that suit their lifestyle."
Bilson explains: "We plan to address these needs through a rich offering of content distributed across digital platforms, based both on all of our major core brands as well as new intellectual properties."
Traditional video game publishers are increasingly looking outside of the core gaming market to emerging platforms like mobile, social and online games as an increasingly crucial growth area and revenue source.
[UPDATE: In an analyst conference call today, CEO Brian Farrell addressed the company's online strategy, which he said will take some time to start generating significant revenues. Referring to THQ as well as other major publishers beginning to invest in that space, he explained, "What we will all experience is high growth rate on a relatively small base."
Initially that will represent a "small amount of digital revenue, like most of our competitors," he said, adding, "We see it ramping in fiscal '11. Fiscal 12 will be even better, given the pipeline we've put in place."
He said THQ is developing three online games based on "core brands," including its Company of Heroes Online based on Relic's strategy series, set to launch in Korea before moving to Europe and North America. There are a further four online games in development at the company's newly-formed digital studios.
Online investment will really pay off, Farrell said, "when we release the MMO" -- likely referring to Vigil's Warhammer 40,000 MMO planned for a fiscal 2012 release. Farrell said the game will finally be unveiled during this year's E3.]