THQ has defended its decision to close a number of internal studios this year, saying it was focusing on reducing costs and increasing profitability in line with its new "fewer, bigger" strategy.
Speaking to investors at the Citi Global Technology Conference today, executive vice-president and chief financial officer Paul Pucino was asked by an investor why no mention was made at THQ's annual meeting of the need to restructure when the publisher announced the closure of three studios less than two weeks later.
"In respect to not talking about it at our annual meeting it's because we simply weren't able to announce it at that time," Pucino said. "We think the best position we can be in with respect to studio structure is fewer is better."
THQ closed Homefront developer Kaos Studio and its UK division Digital Warrington in June. In August, it dropped the shutters on Australian studios Blue Fang and THQ Studio Australia, and the Phoenix, Arizona team that produced failed digital experiment MX Vs ATV.
"The two we just shut in Australia were working on games that aren't consistent with our strategy anymore - one on a movie tie-in, one on a kids' game," Pucino said, also pointing to the strength of the Australian dollar as a deciding factor. "Our strategy now is bringing fewer, bigger triple-A titles to market: one or two original IPs each year, and sequelling them every two to two-and-a-half years."
This renewed focus on keeping costs down means THQ will focus increasingly on its Montreal studio thanks to the generous tax breaks on offer to videogame developers. Headed up by Assassin's Creed creator Patrice Désilets, THQ Montreal is known to be working on at least two titles, and was handed the Homefront franchise after the Kaos closure.
"We're trying to reduce the cost of bringing high quality games to market," Pucino said. "Our studio in Montreal will grow from 150 to 400 employees in the next couple of years. We're going to be able to make games there for 40 per cent less than some of our other studios."
THQ expects the three months ending December 31 to be the most lucrative quarter in its history, thanks largely to Saints Row: The Third and uDraw. The publisher shipped 1.7 million units of its Wii tablet in North America alone last fiscal year, and expects big things when it is released worldwide for PS3 and Xbox 360 in November.