Activision Axes Guitar Hero, Cutting Staff and Other Games Too

Posted by at 11:17 am on February 10, 2011

Activision Blizzard most recent earnings statement was a huge sour note. After losing $233 million in fourth-quarter 2010, which was an improvement over the $286 million it lost in the same period in 2009, Activision said it was abandoning “Guitar Hero” and focusing on battle games such as “Call of Duty.”

The game took the video game industry by storm after it was launched in 2005, reaching $1 billion in sales within a 26-month span, according to Activision. “Guitar Hero III: Legends of Rock” became the top-selling video game of all time in a single year back in 2007. But Warriors of Rock, sold fewer than 100,000 copies during its debut month last September.

“Due to continued declines in the music genre, the company will disband Activision Publishing’s Guitar Hero business unit and discontinue development on its “Guitar Hero” game for 2011,” said Activision, in its fourth-quarter earnings statement Wednesday. Activision’s global workforce will be cut by 7%.

Another series headed for the chopping block is True Crime, a move that comes before the next game in the series, True Crime: Hong Kong, had even hit the market. The open-world crime game had been set to be released for the PC, PlayStation 3, and Xbox 360 later this year.

Activision Publishing CEO Eric Hirshberg said that the decision to cancel the True Crime was due to the fact Activision feels only top-tier games can be competitive in today’s market–and that True Crime wasn’t a top-tier game. “To be blunt, it just wasn’t going to be good enough,” he said.

Hirshberg also shed some light on the Tony Hawk series during the call, saying there will be “no new music or skateboarding games in 2011.” Last December, Activision said it was sticking by the series even though its last installment, Tony Hawk: Shred, sold under 3,000 units during its first week on sale.

Shares were down 10% Thursday after the company posted its quarterly earnings and released its forecast for 2011, which was below what analysts were expecting.

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