Activision cuts 500 jobs but claims COD, Blizzard growth will preserve headcounts
Music titles axed: "We simply cannot make these games profitable"
Activision Publishing boss Eric Hirschberg has shone further light on the publisher's "difficult decisions" to axe divisions including its music games.
Guitar and DJ Hero "demand declined at a considerable pace" despite strong critical reception. "We simply cannot make these games profitable based on current market and demands."
Also cut was True Crime: Hong Kong, with Hirschberg claiming that it was "not going to lead to a title at or near the top of the open world genre. To be blunt it just wasn't going to be good enough."
Hirschberg felt that these were "the right decisions being made for the right reasons" and would lead to a "leaner, more focused organisation."
500 jobs were due to be lost as a result of the cuts, with other internal developers believed to have been affected.
In its results filing, the publisher claimed that "the plan is expected to be implemented in the quarter ending March 31, 2011, resulting in a net pre-tax charge in the first two quarters of 2011, which is expected to total between $35 and $50 million, comprised of severance costs, the costs of other separation benefits and other exit costs."
However, Activision Blizzard CFO claimed that, because the publisher would be more heavily investing in Blizzard and Call of Duty games, "net head count at end of year is probably not going to be materially different.
One of these initiatives is a new Call of Duty studio and online platform, Beachhead, and a free to play CoD spin-off for China. "After all is said and done I don't think our headcount will be that materially different. It will just be more profitably attributed."
The publisher is also persisting in a number of licensed titles, including Spider-Man, Transformers and X-Men, and has promised a new "broad entertainment franchise which brings together toys, games and online in an unprecedented way." This will be revealed at at Toyfair next week, and released in the latter months of 2011.