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Warner's approach to video games is paying off

Most other major entertainment companies have backed away from the video game business, but Warner has bought and expanded franchises not tied to individual films, giving it some of the hottest brands.

October 18, 2011|By Ben Fritz, Los Angeles Times

That's the strategy that appears likely to make Arkham City a blockbuster. Compilation site Metacritic ranks it as the best-reviewed video game so far in 2011, and interest among gamers is twice as high as it was ahead of release for predecessor Arkham Asylum, which sold 4.3 million copies, according to research firm Ipsos OTX. Each sale will mean larger profits for Warner Interactive than on the original, because Warner it did not own developer Rocksteady at the time and co-published the game with another company.

In Arkham City, players control Batman and Catwoman while navigating a section of Gotham City filled with villains such as the Joker, the Riddler and Mr. Freeze. "It's been a massive challenge building a natural urban environment for Batman," Rocksteady director Jamie Walker said. "We expanded from 75 to more than 100 people."

Warner will launch a new Lord of the Rings game in November and a Hobbit title in 2012 before Peter Jackson's movie "The Hobbit: An Unexpected Journey" comes out that December. The game is one of the studio's top releases for next year, along with a Lego Batman sequel and a game featuring a superhero from Warner's DC Comics unit that Tremblay wouldn't name. The company also is targeting younger players with a second Lego Harry Potter in November and casual online games based on Warner characters being made at a new development studio in Montreal.

Building a stronger online presence is the company's most critical challenge, as sales of traditional disc games have fallen 16% in the last two years, according to the NPD Group. Tremblay's goal is that by 2015, 30% of Warner's revenue will come from digital distribution.

But unlike competitors such as Disney, which paid $563 million for social games maker Playdom last year and has racked up losses since, Warner is moving cautiously on the Internet, cellphones and Facebook. It's betting that consoles like the PlayStation and Wii have more life left than some in the industry believe.

"I don't want to say we are ignoring things like social and mobile," Tremblay said. "But our DNA as Warner Bros. is still where most of the video game business is today."

Times staff writer Alex Pham contributed to this report.

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