Subject: FENDERTM'S E3 Report
From: fendertm@aol.com (FENDERTM)
Date: 31 May 1998 18:57:34 EDT
E3 - by FENDERTM
I'd like to start out by making a blanket statement regarding E3, THQ, and the interactive entertainment industry, in that, we are very fortunate to be investors in a company in this exciting industry. If what I saw this weekend was any indication of the health and maturity of the industry, I'd say we have a long way to go before the interest dries up and goes away. I believe we have entered a new era where, due to technology and the market-driven
advent of the sub-$1,000 PC, instead of demand drying up, we will see more platform shifts in the future, e.g., Sega Genesis to SNES to Sony Playstation to N64, to Dreamcast, to ????.it may end at a powerful PC with big screen monitor. To me it seemed very evident that we have reached a point where game developers are focusing more attention on PC titles (better margins.higher installed base, better technology becoming available) whatever the
reason, it was there.
Yes, it is true, THQ did not have a "booth" per se on the main floor but had a more personal and pleasurable meeting/game room on the first level. We found out that THQ decided to "donate" the space they had on the floor, instead of using it. Donating allowed THQ to keep their name on the priority list for next year's show in the event they decide they want to go back and "blow" hundreds of thousands of dollars on a fancy booth. I am not going to
look any further into this, due to the fact that this show was NOT a gamer show, is was NOT a gamer web-page show, it was NOT an investor show, it WAS a retailers show for getting product on the shelves for the Christmas buying season.
To keep the rest of this brief, I will provide bullet point highlights of the show, then a game by game analysis:
ú We (ALL four of us) were treated VERY well by all members of THQ's staff, from developers to all levels of management, and I would like to thank a few of them.thanks.
ú Broken Sword selling better than expectations
ú World Cup '98 released in Europe last week and will be released in NA in mid June. (Soccer and World Cup are HUGE in Europe!!!)
ú THQ won 3 awards (Best fighting game of the year) from various "well-known" associations and Game pages for WCW products while we were there.so much for the not-so-positive reviews these games had when they came out.
ú ECW license is NOT owned by AKLM. The guy who is developing a game under the name Iguana West was allowed to continue using the name "Iguana West" after leaving the affiliation with AKLM. Even with this said, it still seemed like THQ believes that a better wrestling license is out there or will be out there in the future.speculation on my part based on tone, facial expressions and body language.take if for what its worth.
ú Nintendo is matching TV advertising expenses with THQ for the promotion of QUEST 64. Why would they do this? Well, QUEST 64 seems like it will appeal to a younger crowd (not to say all ages will not enjoy this one), and Nintendo is aware that the installed base in homes with younger kids is a relatively untapped market. In Marketing 101, remember that we all learned how to increase market share (More uses, New uses, New users), this strategy
will fall under the latter.
ú Sony is providing support for Rugrats games. Why? See above.
ú Very evident that THQ has a GREAT relationship with Sony Japan, due in part or whole by the work of Mr. Haller and his team. Sony can only release 25 titles a year in NA. Sony Japan negotiates with companies like THQ to release games 25-???.
ú THQ is building a great relationship with TAITO. Ray Tracers was the first step in this relationship, G. Darius is the second. (of note, remember in relationship building, you sometimes need to walk before you run.) I can't wait for the sprint.
ú WCW Print Studio (Europe Only) - MAY be some type of software where you can print WCW stuff and turn them into temporary tattoos. It looks like this had to go through FDA approval here, and it might not been worth the fight (again, my speculation).
ú THQ has been averaging over 100,000 units sold-in for PSX games even after taking out WCW titles.
ú The THQ meeting area was full every time I was in the booth. Very evident that retailer orders and future retail deals were being made.
ú Comment by 1 THQ new management level employee, retailers have commented to her that they believe THQ has the BEST LINE-UP for the upcoming Christmas selling season.
ú There will definitely be a one-time charge for GameFx acquisition in 2Q, the extent we will not know until hainesda talks with Mr. Gysi again in a few weeks. Regardless of charge, we've been told that analysts look at earnings from operations and realize that one-time charges due to acquisitions will occur in growing companies.
ú I finally got my demo CD of Bass Masters, also received demo CD of Redjack, and Rugrats gummy bear-type candy.
ú Early on in the first day, THQ was handing out Penny Racer toy cars.
ú 3 WCW wrestlers were in on Thursday or Friday. I believe that promo pictures were taken after lunch.
ú My opinion and based on information handed out, it does NOT look like BassMasters for PSX will be coming out this year. I expect it Spring '99, then again, I expected it Spring '98..it is NOT canceled however.
ú Road Rash looked good in ERTS booth, games will do well in THQ's N64 port. Did not see Nuclear Strike in ERTS booth.
ú Speedtribes is NOT confirmed to be released on PSX, it is in its test marketing stage for that platform.
ú Devil Dice could be ported over to PC if successful. My comment.Look for Devil Dice on PC.SOON (hopefully)
ú Excession (GameFx) was not shown in booth. Only games being released in time for the buying season were shown, I do NOT think I can say that for the rest of the companies that were on the main floor.
ú I still believe THQ is a shoe-in for Toy Story 2 GB, I commented to Mr. Gysi that it would be a shame if THQ did NOT get the rights to do this game, he had no comment, but didn't look like I'd be disappointed.
ú I am still disappointed there is no immediate plans for a BUCKMASTERS game. I have decided I will buy the license and then market it to different companies.anyone want to help me out with the financing?
ú We talked with one of the developers of Pax (A. Sispoidis).he mentioned he was working on a few games. He was very tight-lipped, although we believe that one is a Pax add-on or sequel of some sort, no dates were released.
ú It appears that THQ did meet with Bear Sterns and other analysts while at the meeting. I heard James Linn, our buddy at Wedbush, was there. Realize also, this does not guarantee anything.
ú THQ understand push and pull marketing strategies and they are getting stronger and stronger all the time.a great balance.essential in this industry.
ú I have NEVER felt more confident about THQ, THQ's games, or THQ's reputation within the industry both the interactive gaming industry and the retail sector. THQ is no longer a TH*Who.
Highlights of meeting with Gary Tramiel (one time owner of Atari and MAJOR shareholder of THQ)
ú Jeff (LT) and I met with Gary for at least an hour on Thursday.
ú Gary still very bullish on THQ's stock.
ú We all need to recognize how well the stock has done in the last year.should it be higher?.YES.can we control it?.NO
ú People need to realize that some investors (the street) think THQ LOST 88% of revenue after 6/99. They are waiting for THQ to prove that fact wrong. It is my opinion (FENDERTM) that it will be proven above and beyond by December of '98, you make your own call.
ú Gary believes that QUEST 64 and Granstream are being well-received by retailers.
ú Overall, a very positive hour well-spent.in a nut shell.be patient.
THQ's Release schedule
2Q
May Platform SRP
World Cup '98 GB 29.99
June
QUEST 64 N64 59.99
Granstream Saga PSX 49.99
3Q
July
Small Soldiers GB 29.99
Mulan GB 29.99
August
Redjack Hybrid Win95/Mac 49.99
Bass Masters PC 34.99
Brunswick Bowling PSX 39.99
Brunswick Bowling PC 34.99
September
Devil Dice PSX 39.99
G. Darius PSX 39.99
Int. Rally Championship PSX & PC 49.99
WCW Revenge N64 59.99-69.99
4Q
October
Speedtribes PC 44.99
Penny Racers N64 59.99
Dead Unity PSX 49.99
Dead Unity PC 44.99
November
Yoda Stories GB 29.99
Shao Lin PSX 49.99
Bugs Life GB 29.99
Rugrats PSX 49.99
Rugrats GB 29.99
Sometime in 4Q
WCW Nitro PC 39.99
WCW Live PSX 49.99
Game-by-Game Analysis
Remember I am NOT a gamer. I am 30 years old. I like Hockey, Hunting and Fishing. This is the perspective my remarks are coming from.
QUEST 64
ú Over 2.5 million in marketing
ú National TV campaign
ú 2 magazine covers
ú Extensive national print and on-line ad campaigns in all major gaming and children's media.
ú TV June-July
ú Print Advertising May-Aug
ú Publicity Mar-Aug
ú Promotion June-July
ú Looks and plays great. It is NO ZELDA, but also did not cost 10's of millions to create and 3-5 years to develop.
ú QUEST 64 to ZELDA comparison is ridiculous in that Q 64 is RPG adventure, ZELDA is not.
ú QUEST 64 is non-graphically violent.
ú "Buzz" from retailers
ú Great to be first to role this "type" of game out.
ú E3 demo game is NOT final version of the game. THQ has been working around the clock the last 6-8 weeks to finish up and add artificial intelligence to characters. Characters (bosses) in demo version are easily beaten, not in real game. From THQ employee, the only way someone can get through, even the demo version of QUEST in 10 hours, is if they read all the pre-reviews, looked at a copy of Japanese playguide and did everything right all the
way through. Even then, it would take approx. 12-14 hours to finish. This game will play long.
ú "Will set the standard for 3D epic" - Nintendo Power
ú "A-" - Game Week
The Granstream Saga
ú Extensive national print ad campaign in all major gaming magazines
ú Banners on select web-sites
ú Movie and playable demo on "Official Playstation Magazine" disk.
ú Title debuted number 1 in Japan
Print advertising May-Aug
Publicity Apr-Aug
Promotion June-July
ú Looks like this will appeal to an older crowd than QUEST 64
ú I would compare this game to Zelda before I would compare QUEST 64 to Zelda
ú Definite interest in the game by people in the booth
ú Looks to me like a great port to N64
ú I did NOT play this one, I only saw it being played.
Bass Masters
ú The first and only realistic 3D fishing game available for PC
ú 30 second TV spot to run around B.A.S.S. programming on TNN network
ú Extensive print and ad campaign in major fishing enthusiast and PC gaming magazines
ú Demos and promo pieces distributed to B.A.S.S. members
TV Aug-Sept
Print advertising May-Sept
Publicity May-Sept
Promotion May-Aug
Radio/Internet Aug-Sept
ú How do you sell another fishing game, you ask, in a market that has many different ones to choose from? Combine these: B.A.S.S. license, top pro celebrities giving tips and techniques in full motion video, thousand of lure combinations, Internet play, TV ads, along with other marketing media and you will get THQ's BassMasters.
ú The only other fishing game I'd want is Sega's arcade fishing game, but I don't have a place to put a box 6 feet by 3 feet by 4 feet.
ú THQ has looked at every detail, besides baitfish (I didn't see them).
ú Nice cross promos with Mercury Marine (Brunswick)
ú Looks like we can have our first tournament in August.
Brunswick Circuit Pro Bowling
ú Officially endorsed and licenses Brunswick bowling
ú Extensive print ad campaign in major bowling enthusiast and gaming publications
ú 30 second TV spots to run during tournament broadcasts on ESPN and CBS
ú Direct mailing to Brunswick mailing list
TV Aug
Print ad July-Sept
Publicity May-Sept
Promotion July-Sept
Radio/Internet Aug-Sept
ú This is the BEST bowling game I have ever seen!!!
ú If you have ever found bowling even remotely fun, you are going to like this one.
ú LT blew a lead where he started the game with 3 strikes in a row, to let me and Wildman come from behind to tie at 158.
ú Great party game
ú Great game setup options, instant replay, lane conditions can change during game, you can be a pro bowler or you can create a bowler.
ú Very Impressive
RedJack
ú Extensive 5-month print ad campaign in all major PC and Mac gaming publications
ú Aggressive Internet ad campaign at demo and product launch
ú Targeted direct mail campaign
ú Demo available on all major PC and Mac gaming publications.
Print Ad June-Oct
Publicity June, Aug-Sept
Promotion Aug-Sept
ú Looked like there was very much interest in this game from people in the booth gaming area.
ú Representative (developers) of Cyberflix in booth to demo and ask questions
ú Graphically beautiful
ú Reminded me from something out of "The Pirates of the Caribbean" display at Six Flags or Disney World.
G. Darius
"Destined to be the definitive shooter for the PSX, G. Darius is a worthy successor to the proud Darius heritage of arcade shooters featuring diverse enemies, 30 bosses, multiple weapons, and power-ups, and numerous play environments, G. Darius has virtually unlimited replay value."
ú Another beautiful game, nice graphics and control.
ú A shooter that anyone can control and have fun with.
ú Some THQ employees expressed that they were very excited to get this title.Darius was HUGE in the arcades in the late 80's.
ú I had definite interest in this one.
Devil Dice
"An additive 3D multi-player puzzle-game, Devil Dice tempts players to beat the clock or up to 4 players in a frantic high speed circus of tumbling dice. Dance your demon over the tops of the dice, turning them to line up numbers, retire rows, and raise your score.
ú This game was the talk of the Tokyo show in March.
ú It had every reason to be the talk of the show.
ú I played this game for 20 minutes and loved it.genuinely fun.
ú This may be the next Tetris.Tetris '98.
ú Great news that this game could be ported to PC, this should be on everybody's PC instead of Solitare.
ú Game had a lot of followers in the Sony booth.
ú Looks like LTLTT may have sold 10,000 units to a European distributor that was watching people play the game. He asked.who is distributing this game, and LTLTT gladly gave up his press kit and told the guy to go back upstairs in the THQ booth and place an order. The guys reply was.this game will sell great.all I get asked for is puzzle games.
International Rally Championship
"A crash course in rally racing, one of motorsport's most dramatic disciplines, has never been so fun as with IRC. Players can choose from 9 different makes of high-tech, four-wheel drive cars and brave the most challenging driving conditions across the world, from Sweden's icy forests to the Kenyan bush, and from the Argentine pampas to the rainforests of Indonesia. With 60 tracks and a freeform track editor, multiple gameplay modes, numerous
hidden features (including tracks and cars) and unbelievably realistic handling and sound effects, IRC is sure to take the driving genre by storm."
ú Was #1 in Europe
ú There were A LOT of racing games at the show.
ú Looked good, but looked like every other racing game I saw at other booths.
ú This one could go either way. I hope the name brand recognition and #1 in Europe have a carry over affect here.
ú Much better than Ray Tracers
Penny Racers
"Having trouble finding a racing game that stands out from the pack? Look no further than Penny Racers, the deepest, most entertaining new racing title for your N64. Control one of 14 different mini-machines fashioned after the popular Penny Racer toy line. Win races to upgrade and customize your vehicle with seemingly unlimited parts, weapons, defenses and enhancements. Revel in the variety offered by 9 challenging pre-set tracks and a
free-form, create-a-track feature. Penny Racers is not just a race, it's an adventure."
ú Looks and plays like a Mario Kart type of game.
ú I like the toy line tie-in
ú I think it is too early to tell on this one.
ú I would like to know the promotion strategy of this game, but is was unavailable.
Dead Unity
"With its epic story-line, enthralling cast of futuristic characters and completely immersive environment, Dead Unity, sets a new standard in real-time 3D graphic adventures. The year is 2062, and the place is Unity, a once-thriving metropolitan model for urban efficiency and peaceful co-existence, now a post-apocalyptic ground zero of genocide at the hands of the Global Mediation Machines Corporation's robotic minions. You play as Works, an
artificially enhanced human with a mysterious past shrouded in conflict. Works has been entrusted with the task of shutting down GMM's evil computer core, with only his A.R.M. (Automatic Reconfigurable Munitions) and its multiple weapons configurations for protection. Tangle with more than 30 types of horrific enemies, defeat dozens of difficult puzzles and traps and venture through more than 500 meticulously pre-rendered environments, braving
hours of intrigue, action and suspense."
ú I was NOT impressed with this one, but I actually did not see the game being played in full action. I did not know how to control the main character at all.
ú Does not look like a game I'd play, but could see where it could do ok in a niche market.
Speedtribes
"Speedtribes a stunning, real-time 3D combat title, immerses PC gamers in a brooding, amazingly unique alternate reality. There they must align themselves with one of six dueling, heavily-armed "aerocycle" gangs known as Speedtribes. The tribes' members vary from humanoid to gothic, non-living nightmares, but they all have one thing in common, their devotion to the sheer speed of their machines, the pure violence of combat and the ultimate glory of
conquest. With hair-raising speed, unsurpassed manuverability and multi-player death match capability, Speedtribes is a must-have for the adrenaline seeking action gamer."
ú Met the developer.great guy.has great vision
ú I like the promotion behind this game: tie in with a comic book and soundtrack
ú Great visuals
ú Seems like the developer is doing a lot his own leg-work to get this title to the mass public.
ú Definitely has a chance.
ú I'm sure that is why THQ is in test market stage for PSX version.this will be a hit or miss. But if it is a miss, it will not be for lack of work, dedication and promotion.
WCW Sequels
ú They are sequels. They are what NHL '98 is to NHL '97, etc.
ú They will add significant earnings to THQ.
ú These games will assure that everyone who wants a WCW wrestling game will have at least 1 by December.
ú All games look visually better than WWF WarZone.WarZone looked more like boxing than wrestling.
ú CASH is KING, what will these earnings buy us???
Shao Lin
"In Shao Lin, fighting fans will find what they've been lusting for.high speed, 3D fighting for up to 4 players simultaneously.
Amidst beautiful backdrops of ancient Chinese temples and landscapes, gamers will enjoy lightening fast action , utilizing characters trained in 6 different schools of the martial arts. The "Vs." mode will allow any combination of players, including one human vs. 6 CPU-controlled opponents at once. The "training" mode will give gamers the opportunity to master their fighting art, and the "Quest" mode will add an action/RPG element to this
ground-breaking title."
ú One THQ employee I interviewed said that this will be the unexpected hot game.
ú Hainesda kicked LT and my butt in this game.
ú Beautiful graphics and scenery
ú 4-player mode is excellent
ú Great interest in the game at the Sony booth.
ú May just be another of the many martial arts type game.
Rugrats
"Rugrats, a non-linear, action adventure, is a game where everyday happenings in the world turn into comic adventures. Players control their favorite characters as they go on a series of wacky adventures based on nickelodeon's Emmy award winning, top-rated animated Rugrats series. Whenever adults are around, these one-year-olds act like real babies, but when they are alone, they drop their witless poses and talk to each other with the vocabulary of
5 year olds. As Tommy and his pals wobble through life, supported by legs not yet used to walking, they show us the world from a below-the-knees perspective."
ú 4 words.Back Up The Truck.we found WCW replacement revenue.
ú We met the developer and he was so pumped about the game.
ú Simultaneous release in Europe and NA.
ú Rugrats HUGE in EUROPE!
ú Sony backing with promotional dollars.
ú A kinds of women and parent type people would immediately stop and look at game in Sony booth.
ú This game will sell a lot of Playstations and vice versa.
GameBoy Games
ú Titles speak for themselves.
ú If the movies do well, so will the games.
ú Did NOT see Yoda Stories.
This brings me to the part where we (The E3 four) decided to pick games based on four categories. MY selections are below:
Best THQ Game: QUEST 64
Best THQ Seller: Rugrats
Sleeper Hit: Tie between Devil Dice and Brunswick Bowling
Top 5 THQ games that impressed us. These are actually the games that I would buy in order of preference.
1. BassMasters
2. Devil Dice
3. Brunswick Bowling (can you believe it?)
4. G. Darius
5. QUEST 64
And finally a comment about the stock price.in the words of Mike Tyson.its ludicrous.
What can you do?
Go THQ!!! |
