THQ is Bankrupt for Real This Time

It's Chapter 11, which is a restructuring. We're going to be just fine, thank you for your concern, though

I just can't buy this PR wordsmithing. Restructuring really is a nice word for the shareholders. I still hope for the best outcome.

Ok, I'll be totally clear right from the get-go; this isn't PR related, it's just my own personal opinion.

Don't make me type out a "Opinions of Tribal-Bob do not reflect opinions of THQ, it's subsidiaries, yadda, yadda, yadda stuff"

THQ i hope will be ok, Relic will be FINE, remember when sierra studios owned Relic? Sierra went down, Relic is boss so they got bought by someone else and continued making epic games, Relic will be fine regardless, and I think when this new line of games goes out THQ should be ok too.

Bankruptcy in America is a total joke anyways....just look at the automobile industry.

anyone seen that?

I've seen it mentioned. It's basically the sort of money they expect to make of the different things. Saints row 4 being the big money maker.

And so if anyone else wants to bid in, then they have the sort of idea what they can expect theoretically in the end.

this gave me a mini lulz



Hope THQ survives this and comes out stronger.

The interesting game is Atlas.
A new Relic game.

By the looks of it a free to play title since they are not expecting to sell units but are still expecting revenue. The only title so far i recall that might have that was DoW 3. As i recall when bilson talked about things way too early that it could be a free to play title.. Could be something else though. hard to say.

I am not worried at all for Relic.

Some fans will remember that, when Relic started out, it was a developer that pretty much had to search for their publishers(e.g: guys with $$$$). This is why Homeworld 3 was never released, because Sierra had the rights (which have been reacquired. OH LONG JOHNSON!). Impossible Creatures was published by Microsoft, for instance.

So this time around it is different, because THQ actually owns Relic Entertainment. However, in the worst possible scenario, THQ will restructure and sell itself in parts to the highest bidder, Relic being one of them.

Why am I not worried? Relic has a very successful portfolio of games, they've always had a talented team of people together which is worth pure gold AND they have a dedicated community of loyal clients/fans*.




*Any decent, moneygrabbing, employee-exploiting company will value the costumer base as an added bonus

I am not worried at all for Relic.

Some fans will remember that, when Relic started out, it was a developer that pretty much had to search for their publishers(e.g: guys with $$$$). This is why Homeworld 3 was never released, because Sierra had the rights (which have been reacquired. OH LONG JOHNSON!). Impossible Creatures was published by Microsoft, for instance.

So this time around it is different, because THQ actually owns Relic Entertainment. However, in the worst possible scenario, THQ will restructure and sell itself in parts to the highest bidder, Relic being one of them.

Why am I not worried? Relic has a very successful portfolio of games, they've always had a talented team of people together which is worth pure gold AND they have a dedicated community of loyal clients/fans*.




*Any decent, moneygrabbing, employee-exploiting company will value the costumer base as an added bonus

I dont think anyone is worried for Relic really.

Has Relic actually been very successful? I thought CoH was a bit of a sales failure, the Homeworld titles were always niche, and the WH40k games sold as much as you'd expect licensed games to sell but not much more. And I don't know anything about The Outfit or Impossible Creatures but if they had been big successes wouldn't we have seen sequels or something like we saw for all of Relic's other games (except Space Marine)?

As for the talented team of people, haven't a lot of people left Relic since them?

I'm sort of worried for Relic. RTS games aren't big money makers and they are what Relic mostly makes.

Has Relic actually been very successful? I thought CoH was a bit of a sales failure, the Homeworld titles were always niche, and the WH40k games sold as much as you'd expect licensed games to sell but not much more. And I don't know anything about The Outfit or Impossible Creatures but if they had been big successes wouldn't we have seen sequels or something like we saw for all of Relic's other games (except Space Marine)?

As for the talented team of people, haven't a lot of people left Relic since them?

I'm sort of worried for Relic. RTS games aren't big money makers and they are what Relic mostly makes.

WH40k was a big success I thought.

But did they sell because of Relic or because of the WH40k license that someone can buy from THQ without also buying Relic?

The outfit was afaik a disappointment in sales and kinda regarded by critics as a underrated game in terms of sales. Vgcharts says that the game sold 220 000 copies, which is pretty bad.

Wh40k games are popular because of the license and what Relic did with it. OFC a license will sell x amount of games because of earlier fan following and brand recognition, but with the amount of expansions and a sequel that Dawn of war got, I'd guess it sold at least decently. I read once on relicnews were someone claimed that Dawn of War 1 sold 1.5 million (comment was 06) but he didn't provide any source.

Yeah but my point is, if sticking a WH40k license on a game will give it good sales, then nobody needs to buy Relic - they can just by the license and leave Relic twisting in the wind.

Yeah but my point is, if sticking a WH40k license on a game will give it good sales, then nobody needs to buy Relic - they can just by the license and leave Relic twisting in the wind.

Relic is a profitable studio in part because they are subsidized by the Canadian government and they have their own portfolio of valuable brands and quality games they created themselves rather than license from other companies/entities. COH may have never quite caught on as an "esport" but I'm fairly sure it was a hit for a computer game, the same goes for the dawn of war/wh40k and homeworld series.

It's true that RTS games aren't huge money makers unless your name is Blizzard but I'm fairly sure Relic will be just fine as long as COH2 is a moderate hit.

I summon a large wall of roadblocks!(aka wall of text)

We need to keep in mind that just because other mainstream games are making 100+ million sales and hundreds of millions of dollars, does not mean a game is only successful then.

Back when I was studying Game Art & Design in Vancouver, BC, several teachers agreed that a AAA title's budget started (at least) at $10,000,000.00 USD. Sure, many many AAA titles go way above that, the money CoD, Halo or GTA spend in marketing alone would produce several stand alone titles, but that's because their target sales are even higher.If a PC game sells 200,000 units at $50 or $60 a pop, then it pays for itself. Many, many PC title sare made for less than the above figures, and thats why expansions and DLC's help.

And....

1)No, Relic is not a multibillion dollar company like blizzard, or infinityward or now treyarch, but it makes a profit to keep itself in business. Considering the amount of small and medium studios that die every year (there are very many, some we have never even heard of, people in the business will know), Relic has kept alive in some of the Game industry's darkest moments.

2)Relic DOES have a talented team of people. Yes, a lot of its personnel may have left to other opportunities, but in the game's industry that is NOT uncommon at all. Sure, not all of their games have made us cry from joy, but then again, what company has? Even Blizzard and Valve, once untouchable giants, have received frowns from its fans.

I summon a large wall of roadblocks!(aka wall of text)

We need to keep in mind that just because other mainstream games are making 100+ million sales and hundreds of millions of dollars, does not mean a game is only successful then.

Back when I was studying Game Art & Design in Vancouver, BC, several teachers agreed that a AAA title's budget started (at least) at $10,000,000.00 USD. Sure, many many AAA titles go way above that, the money CoD, Halo or GTA spend in marketing alone would produce several stand alone titles, but that's because their target sales are even higher.If a PC game sells 200,000 units at $50 or $60 a pop, then it pays for itself. Many, many PC title sare made for less than the above figures, and thats why expansions and DLC's help.

And....

1)No, Relic is not a multibillion dollar company like blizzard, or infinityward or now treyarch, but it makes a profit to keep itself in business. Considering the amount of small and medium studios that die every year (there are very many, some we have never even heard of, people in the business will know), Relic has kept alive in some of the Game industry's darkest moments.

2)Relic DOES have a talented team of people. Yes, a lot of its personnel may have left to other opportunities, but in the game's industry that is NOT uncommon at all. Sure, not all of their games have made us cry from joy, but then again, what company has? Even Blizzard and Valve, once untouchable giants, have received frowns from its fans.

First a AAA game on PC should cost well above $10M. Assuming the COH2 team is 50 people (typical AAA games are 100 people) and their fully loaded cost is $100K on average and it takes 2 years, the total development cost would at a minimum $10M and probably closer to $20M. However this is just dev cost and not including marketing costs and also corporate overhead. The probable minimum total cost including overhead and marketing would be closer to $30M-$40M.

So lets take a scenario where you sell 1M copies. Let's assume the is ASP is $60 and all games are sold through Steam or retail. In either case, they take -30% cut as the distributor. So if you sell 1M copies at $60, the gross revenue is $60M, but the net revenue after steam cost is $42M. This of course assumes all games sold at full price which is generally not the case.

If you compare the $42M net revenue vs. full total cost which is probably closer to $40M, then in a scenario where you sell just 1M copies its basically a "breakeven" proposition.

To further colloborate this estimate, if also look at the internal documents from THQ's bankruptcy filing, they are predicting COH2 sells 2.0M copies, generate a net revenue of $56M, and estimate contribution profit of $15M. This implies the ASP of the game would be $28 (much lower than the $42 in my estimate). The lower ASP is probably due to discounts, etc. Also, then if you look at the contribution profit estimate of $15M vs. the revenue of $56M, this implies a total cost of $41M. This cost is similar to my estimate above.

The bottom line here is that a for a ship-once AAA PC game, a 2M unit seller is marginally profitable.
In terms of real money makers, the best example of a "strategy" game that is doing huge numbers is League of Legends. LoL doesn't sell anything upfront, rather its all done through item sales. LoL (which is owned by Tencent) is doing an estimated $300-400M of revenue PER YEAR. Not one time, but each year and growing. The F2P item model can sustain itself much much longer than a ship once client sale. That's why Relic also wants to add some microtransaction elements to COH2.