Confirmed: THQ shuts fives studios, makes lay-offs at two more

By Patrick Garratt, Tuesday, 4 November 2008 06:46 GMT

thqlogo.jpg

Gamespot’s running a confirmation that THQ has closed five of its studios, as was rumoured last night.

Paradigm Entertainment, Mass Media, Helixe, Locomotive Games, and Sandblast Games were defunct as of yesterday, while Rainbow Studios and Juice Games have suffered redundancies, a THQ rep admitted.

“It’s just constantly trying to react dynamically to the market,” the spokesman explained, “whether it’s because of things happening to our industry or the economic environment as a whole. It’s making sure that we’re set up over the next three to five years to be profitable and successful.”

In a rumoured email published by Kotaku, company boss Brian Farrell apparently blamed “today’s difficult economic environment” for the turbulence, and promised to have a more in depth explanation of the moves in the conference call following the publication of Q2 results on Wednesday.

Read the full email after the link.

Good afternoon team,

I want to take this opportunity to update you all on some important actions we are taking to best position THQ for future profitability and growth.

As you know, the past year has been a challenging one for THQ, and the video game industry is changing rapidly. We are responding aggressively to both changing market dynamics within the video game sector and the impact of today’s difficult economic environment. Over the past several weeks, we have completed a new strategic plan for THQ and presented it to our board of directors. The plan was initiated by me and developed by the executive committee in close collaboration with senior members of our product development and publishing organizations.

The new plan will result in substantial changes to our product strategy and pipeline. Our goal is to ensure that we have the right resources behind the products and product categories that represent the biggest opportunities for THQ.

As a result of this new plan, we have discontinued a number of projects from external developers, as well as certain projects within our internal THQ studios. In a number of cases, the cancellation of a project means that the THQ studio working on that project will be closed. Specifically, we have closed Helixe, Sandblast Games, Locomotive, Mass Media and Paradigm studios. We have also reduced staffing at Juice Games and Rainbow Studios as a result of our product realignment. Our senior PD and HR teams are on the ground at each of the affected studios today, meeting with the employees to discuss severance packages and outplacement services, as well as potential opportunities on other THQ products.

While the actions we are taking are difficult, we believe they are a necessary step toward returning THQ to profitability. We are confident that the product pipeline we have outlined in our strategic plan positions us to win in the video game marketplace. We also remain very confident in our internal development capabilities, as evidenced by the strong critical and commercial success of Saints Row 2 and de Blob.

I encourage each of you to listen to our Q2 FY 2009 earnings call this Wednesday as I take investors through both the trends that are affecting our business and the manner in which we are realigning our business to best compete.

I thank you for your continued focus during this challenging time, and I look forward to sharing more details about our strategic plan with you in the near future.

Brian

Sometimes we include links to online retail stores. If you click on one and make a purchase we may receive a small commission. For more information, go here.

Comments

Headlines

Brian Farrell

  • THQ files standard FORM 8-K with SEC noting dissolution of executive staff

    THQ filed its FORM 8-K with the SEC, announcing the departure of its officers and executives – which is the last notice we’ll probably very get in the mail from THQ. Filed on January 30, the form reads: “THQ Inc. terminated the employment of Brian J. Farrell as chief executive officer of the Company, Jason […]

  • THQ sale: Rubin & Farrell reflect on company's closure

    THQ’s properties were sold off at auction last night. The 22-hour process saw the remains of the company carved up and sold off to buyers. Sega bought Relic, Ubisoft bought South Park and more. Check out Steph’s in-depth report on the matter here. This morning former THQ president Jason Rubin and boss Brian Farrell have […]

Helixe

Juice Games

  • Juice Games staffing for "ambitious new racing game"

    Juice Games has posted seven ads on the Edge jobs board for staff to work on an “ambitious new racing game.” Wonder what it could be? The company’s looking for people with “an interest in developing game code for console platforms including PlayStation 3 and Xbox 360.” Juiced 3 confirmed. Thanks, PS3Center.

  • Juice Games to lose 30 staff

    GI’s reporting that UK-based Juice games is to lose 30 staff in now-confirmed cuts by THQ. According to the site, a “high risk” project has been shelved after a year’s work. More through there.