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THQ Shutting Joint Venture That Sold Online Soccer Game

July 02, 2002|From Bloomberg News

Video game maker THQ Inc. said it was shutting down a venture that sold an online soccer game in Britain, a step that will crimp second-quarter profit.

The game, which put players in the role of managers rather than athletes, didn't attract enough consumers who were willing to pay the monthly fee, THQ said. The experience mirrors that of Electronic Arts Inc., the biggest video game maker, which has yet to make a profit from its online games unit.

THQ's net income will be reduced by $2.8 million, or 7 cents a share, to about 10 to 12 cents, in the quarter because of costs to close Network Interactive Sports Ltd., a venture started with HotGen Studios a year ago.

"The reality is that people just weren't willing to take out their credit cards and pay for this over the Internet," said Tim Walsh, vice president of THQ's international operations. "The subscription model just didn't pan out."

Other companies are betting it will. Microsoft Corp. is starting a fee-based service called Xbox Live that will allow customers to play online. Sony Corp. has a similar service for its PlayStation 2.

Shares of Calabasas-based THQ fell as much as 16% to $23.07 in after-hours trading after the announcement, later rebounding to $26.01. The shares had closed off $2.50 at $27.32 on Nasdaq.

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