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Activision cancels Guitar Hero

Activision's "Guitar Hero" Logo
Activision's "Guitar Hero" Logo

One thing that’s been going around today is the news that Activision/Blizzard has officially pulled the plug on Guitar Hero, the brand that defined a new paradigm in console play. In an earnings call on Feb 9, Eric Hirshberg, CEO of Activision, stated:

After two years of steeply declining sales, we've made the decision to close our Guitar Hero business unit and discontinue development on our previously playing Guitar Hero title for 2011. (SeekingAlpha)

What’s somewhat surprising is that the news shows that current projects are being cancelled and the business unit disbanded. It’s surprising to cancel a project in development, especially with a tried-and-true formula like Guitar Hero. Obviously, they’ll continue to support the game via downloadable content (DLC), but that’s a low-cost/high-margin endeavor and makes easy money for the company.

From a different perspective, though, this is extremely sensible for Activision. How many more stand-alone titles can be created? Instead, Activision is doing what it should be doing – focusing on tapping the already-saturated market with new DLC while cancelling projects that are not likely to bring in a good return and will likely only cannibalize from their other titles.

What does this mean for local developers? For iPhone developers, using in app purchasing (IAP) is a strong way of keeping your games fresh to your players while at the same time insuring that you’re not investing tons of time and energy into completely new (unproven) projects. If you’ve got a product that’s not performing at all, you need to be highly critical and determine, as Activision did, whether it’s best to cut your losses (or at least your meager earnings) or try going in a different direction. If your game hasn’t caught on, you’ve probably not found the “fun” (as I mentioned in a previous article here).

Local developers like Team Phobic have, in the past, focused on new development efforts based on their older paradigms (just as Guitar Hero did). With Bounce On 2, though, Team Phobic brought along a whole new raft of features, like social media integration and an expanded awards system. Depending on where their costs are (level design or engine development), it may make more sense in the future to focus on DLC for future titles rather than on wholly new development.

For your own projects, what makes the most sense? Looking at technologies and ideas that are easily extensible will offer you the most “bang for your buck”, but there is the concern about churning out just more of the same (even if it’s available via IAP). It’s also a question of how creative you want to be versus how financially successful. The DLC money can be an enticement, but if it’s at the cost of your creativity, I recommend leaving the door open for it but explore that fully later when you’re tired of working on your next great project. Then you reinvigorate that old title and exploit the long tail. But how much you do that is a judgment only you can make.


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