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Saint's Row/Warhammer 40,000 publisher THQ has pursued a faulty business model to the brink of the company's demise, says Take-Two CEO Strauss Zelnick, predicting that his company's rival has less than six months left in the market. “Strategy didn't work and the execution was bad,” Zelnick told attendees at MIT's Business in Gaming conference: "THQ won't be around in six months.” THQ, unsurprisingly, disagreed with Zelnick's assessment.
Perhaps figuring that there hadn't been any really juicy game-industry beefs since the Great FPS Wars of 2011 claimed so many young lives, Zelnick used the 13-year-old company to highlight the perils of over-reliance on licensed properties. The Take-Two head characterized THQ's strategy as “licensed properties, first and foremost. License stuff from other people, whether it's UFC or WWE or a motion picture property, and make a game around that.” By comparison, Zelnick says, the 2007 acquisition of Take-Two by ZelnickMedia marked the company's transition to a policy of “100% owned intellectual property.”
Because licenses must be periodically renegotiated, publishers reliant on externally-owned IPs face a quandary, says Zelnick: the best-recieved title will only drive up the value of its name-brand, forcing the licensee to pay more to lease the property next time. Zelnick accuses THQ of answering this dilemma with substandard product: “THQ has had some good games, but ... the quality hasn't measured up.”
The past year has seen THQ giving up on Red Faction, one of the company's signature IPs over the past decade; and announcing that its upcoming licensed MMO, Warhammer 40,000: Dark Millennium Online, is to be stripped of its mass-multiplayer components amidst large-scale employee cutbacks. However the company is also preparing for big-scale releases such as Darksiders II and the licensed South Park RPG.
“Obviously,” THQ has responded, Zelnick's assessment is “outdated and inaccurate,” and his comments “irresponsible and false. Perhaps he would be better off commenting on his own business,” says the publisher.
[UPDATE:] "While discussing our strategy I spoke out of turn about someone else’s," Zelnick has told Game Informer: "It was inappropriate and I regret it."
