The video game industry is a powerhouse industry in California and the Valley has its share of the action. Major players such as Disney Interactive Media Group, Warner Bros. Interactive Entertainment, THQ Inc., and Insomniac Games — and several smaller shops that serve the industry and the gamer in, perhaps, a less obvious way — call the region home, adding to the Valley’s hip, cool factor. In this issue, we offer an inside look at the Valley’s video game industry by way of the E3, the world’s largest trade show for video and computer games and related products, held at the Los Angeles Convention Center from June 5-7. The show is closed to the public, but our special report highlights what a few local companies are showcasing this year and are planning for the future. Don’t miss our photo gallery on page 24. It’ll take you inside the video game world and probably make you a little jealous you weren’t there. At E3, the biggest companies typically take a “Go big or Go Home” approach to their exhibit space. So when a top game publisher such as THQ decides not to have one at all, it speaks volumes about the company’s current state. Indeed, THQ is losing in the points game for profitability. The Agoura Hills-based company posted a $53.2 million net loss in the fourth quarter of the 2012 fiscal year, ended March 31. For the full fiscal year, the company had a net loss of $239.9 million, widening the gap from the previous fiscal year when it posted a net loss of $136.1 million. But it appears the company’s making some financially responsible decisions, including saving money by forgoing the E3 booth space. Instead, the company— which at past shows had a rad display — decided to talk up its game plan behind closed doors at the show. Why pretend you’ve got money, right? Read about the management changes and other initiatives to improve the company’s bottom line on page 24 of our Special Report. Disney, on the other hand, went big. We’d expect nothing less from the Mouse House, even though the company’s Interactive Media division hasn’t exactly been winning in profitability points, either. Interactive Media revenues for the fiscal second quarter ended March 31 increased 13 percent to $179 million. The segment narrowed its loss to $70 million, from $115 million in the first quarter, attributing its improvement to greater focus on social games and lower product development costs associated with console games. The numbers don’t tell the whole story. THQ and Disney and others in the Valley, such as Insomniac Games, deserve a lot of points for creativity, innovation and fearlessness. Insomniac is venturing into the world of social gaming with “Outernauts,” which will debut on Facebook this summer (page 22). It’s not easy to create an alternate universe and win over today’s tough crowd of gamers. But these guys are pulling the stops to bring entertainment and fun to our world, and for that, they’re all winners. Editor Jaclyn Giovis can be reached at 818-316-3125 or [email protected].
Video Game Companies Mix Creativity and Business Acumen
