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January 2012

Unplugging

The one constant in life, as you may have heard, is change – and nowhere does change comes faster than in the technology world. Unplug

After three years of bringing you news about technology and how it applies to the entertainment world, Technotainment is shutting down. And while we hate to lower the curtain on this facet of our coverage, it's critical to note that in no way is Variety walking away from this area of the industry.

While this daily blog will no longer be updated, Variety will continue to cover technological matters, the video game industry and everything else we've focused on here as part of our day-to-day coverage in Daily Variety and Weekly Variety. (And you don't need to look much further than our extensive coverage of the just-completed Consumer Electronics Show to see that.)

I’ll still be regularly contributing to Variety – and there’s plenty coming that you won’t want to miss. So if you've got a story to pitch or a comment to make, I invite you to stay in touch with me directly at chris.r.morris@gmail.com.

On a personal note, I want to thank Dana Harris, who brought me into the Variety family to run this and the late Cut Scene blog some three years ago. Variety group editor Tim Gray has been incredibly supportive of the blog and encouraged me to take chances. I will be forever in his debt. And Variety.com Chris Krewson has been a firm backer of what we do here as well.

Thanks most of all to those of you who have made Technotainment a part of your daily routine, however. Your notes, comments and thoughts have never failed to be insightful and eye opening. I look forward to continuing our relationship in the pages of Variety.

Gamemaker THQ gets delisting notice from Nasdaq

Video game publisher THQ, which has worked closely with several Hollywood studios throughout the years, is facing a delisting on the Nasdaq stock exchange. Thq_logo

The company, which has partnered with many Hollywood studios, including Dreamworks and Disney in recent years, has filed an 8K form with the Securities and Exchange Commission, announcing it has received a stock delisting notice from the stock market.

The notice was sent on Jan 25, when THQ shares traded under $1 for the 30th consecutive business day. And while it's certainly dire (and further rattled shaky investors today), it's not necessarily fatal.

THQ will have 180 days – roughly six months – from the point it receives the notice to turn things around and regain compliance, which means keeping its stock above the $1 mark for a minimum of 10 consecutive business days.

At the same time, the company will put together a plan to remedy the situation, in case the stock doesn't turn around naturally. Most commonly, this is done via a reverse stock split. It's expensive, time consuming and embarrassing, but it's also fairly effective – most of the time.

If, after that period, the stock's still not trading above the $1 mark, there's an opportunity for a hearing that could extend the probationary period.

Nasdaq, as a rule, prefers not to delist companies. When possible, they give them the benefit of the doubt. And if THQ can point to a strong lineup of games in development, that could be enough to convince Nasdaq to give it some extra time.

Of course, a delisting threat is far from the only trouble at THQ these days. Analysts have questioned the company's cash flow. Michael Pachter of Wedbush Securities, in December, wrote he believed "THQ is at risk of running out of cash by the June 2012 quarter" after the company's reduced guidance.

"With another unprofitable year expected in FY:12 (its fourth unprofitable year in the last five years), we expect the company’s cash balance to become an issue if it is unable to turn a profit in the first half of FY:13," said Pachter. "Given its declining licensed and core properties (apart from Saints Row), and an uncertain release schedule next year, we remain unconvinced that FY:13 will be profitable."

'Indie Game - The Movie' to highlight Game Developer's Conference

Typically, the entertainment highlight of the annual Game Developers Conference in San Francisco is the Game Developer's Choice Awards – one of the video game industry's more prestigious award ceremonies. Indiegame

Those will still be handed out this year, but attendees are likely to be more excited about the announcement that Indie Game – The Movie will be screened at the show on March 5 at 6pm.

In addition to showing the winner of the Best Editing award at the Sundance Film Festival, the show will host a panel with the film's featured subjects and creators following the film.

The film follows independent game developers Edmund McMillen and Tommy Refenes (maker of "Super Meat Boy"), Phil Fish ("Fez") and Jonathan Blow ("Braid"), showcasing the creation and release of their titles.

The film has been playing to sold out audiences in select screenings since its premier earlier this month.

Google Music adds key backup feature

Google Music hasn't been making a lot of noise lately and is, in some ways, in danger of being overshadowed by other cloud music sites. But the Internet giant has roared back with the addition of a key backup feature for users. Google_music

Starting immediately, Google Music users are able to instantly restore their music collection with a single click. That applies to both purchased music and any songs they've added from their own library.

It is, of course, a direct response to Apple's iCloud, which automatically backs up App Store purchases, but also lets users backup music from other sources on their hard drive – for a price.

Google Music's new features don't appear to carry any charge – and they're being targeted at the Android audience, though PC users will able to use them as well. The only catch? Users are restricted to two downloads each via the Web interface.

Nintendo braces for first corporate loss, Wii-U confirmed for this year

Nintendo's financial year won't end until the end of March, but the company is bracing investors for its first-ever financial loss – and it's going to be a massive one. Luigimansion

By the time the year ends, the company expects to post an $837 million loss – a much worse number than the $258 million shortfall it had previously predicted.

Poor holidays bear part of the blame. The company announced dismal quarterly earnings today, noting that its nine-month loss (through Dec. 31) came in at $623 million - $1.3 billion worse than it performed a year ago.

A stronger than expected Yen also contributed to the numbers, and the effects of the 3DS price cut deeper into the company's coffers.

The bright spot was a confirmation from the company that the Wii-U would ship to all major territories by the holiday shopping period. That was widely expected, but whispers about problems with the hardware had some investors and analysts on edge.

Nintendo sold just shy of 9 million Wiis worldwide between April and December versus 13.7 million units during that time in 2010. And Nintendo DS sales plunged as the 3DS took the spotlight, falling from 15 million in 2010 to 4.6 million last year.

And as consumers turn their focus to high definition consoles and smartphones, sales are likely to continue suffering. Nintendo lowered its forecast for 3DS, DS and Wii hardware sales – and expected 3DS software sales to come in lower than initially thought, as well.

Mixed news on Netflix earnings

While Netflix saw its net income take a hit in the fourth quarter, the news wasn't all-bad. Netflix2

The company beat estimates and more importantly saw its streaming business grow, despite a series of events in 2011 that were one PR disaster after the next.

The company reports it added 220,000 new domestic streaming customers during the period, bringing the total to 21.67 million. Internationally, it netted 380,000 new customers, bringing that total to 1.86 million.

The outlook for the first quarter of 2012 is rosy as well, with the company projecting a 1.7 million customer increase in its streaming operations.

DVD subscriptions continue to suffer, though, with 2.76 million people canceling their service with the company. At present, 11.17 million people are still subscribing to the DVD by mail program.

Apple's play for the schoolyard

Apple's latest announcement may have nothing to do with the entertainment industry, but it's a clear signal that this tech giant is interested in branching out far beyond its current fields of interest. Ibooks2

At a press conference today in New York, the company rolled out a new version of iBooks that is squarely targeted at the educational marketplace – specifically primary and high school.

Textbook that are included under the iBooks 2 umbrella (which became available Thursday) will be interactive, full-screen digital versions of the classroom standards that use video and animations, along with the familiar swiping and pinching gestures.

Additionally, the company introduced a new version of iTunes, which will focus on iTunes U. Previously, that learning program was focused at a college and post-grad audience. Now, the company's opening it up to K-12.

The emphasis for now is on high school books, which will cost $15 or less. Early publishing partners include Pearson, McGraw-Hill and Houghton Mifflin Harcourt. Together, those companies control roughly 90 percent of the market. Additionally, Apple is also working with DK Publishing to create books for younger audiences.

Changes coming to LED TVs?

While LED TVs provide a brighter (and arguably better) picture than their LCD counterparts, consumers aren't embracing them at a pace the industry or analysts have been expecting. Led-tv

That's likely to result in some changes to the sets – and they don't sound especially encouraging. NPD reports set makers are reducing the number of LEDs per TV set which will lower brightness and veer away from the slim designs and picture quality that have helped LED backlit sets.

“LED penetration in LCD TV was 7 points lower than our forecast a year ago, mainly due to high LED premiums,” said Yoshio Tamura, senior vice president at NPD DisplaySearch. "The premium for a LED backlight in a 32" LCD TV was 42 percent in Q4'11, although it had been expected to fall to 27 percent. Therefore, TV makers are changing their strategies on direct LED-backlit TV. Instead of high picture quality, set makers have chosen low-power consumption with a corresponding lower price as selling points for this new type of LED-backlit TV. This will increase its competitiveness with CCFL-backlit LCD TV and even CRT TV."

While sales are the ultimate goal, the trend is a disappointing one for videophiles. NPD did not cite any specific manufacturers in its report, but edge-lit LED TVs are much less dynamic than their backlit cousins. 

Max Payne 3 delayed – again. Take-Two earnings to suffer

The oft-delayed Max Payne 3 has hit another roadblock and been pushed back again – and the delay is going to push publisher Take-Two Interactive Software into the red. Max payne 3

The company's Rockstar Games division announced this morning that the game, originally set to launch this March, would now not bow before May. That marks the fourth delay, if you're keeping score at home.

Because the game has been pushed out of the fiscal year, Take-Two was forced to revise its estimates, deducting an anticipated $210 to $230 million in revenue. The company now expects to report a loss for fiscal 2012.

"We do not take changes to our release schedule lightly, and this short delay will ensure that Max Payne 3 delivers the highest quality, groundbreaking entertainment experience that is expected from our company," said CEO Strauss Zelnick.

In an interview with Variety last year, Dan Houser, one of the studio heads at Rockstar discussed the impact the frequent delays have had on the team.

"I think it's part of the industry, if you want high quality games," he said. Maybe, if you are making a sequel without much design innovation and without any real technical innovation -- you know, just a bunch of new content on board with a broadly existing engine with a broadly existing design -- you can have some degree of confidence in guessing your release date.

"Anyone that's doing what we were trying to do and guesses at the start of the project exactly when things are going to be done, well they are better at this job than I am. We can't do that while guaranteeing quality.

What impact did it have on the team? None negative. I think the team was happy that we were pursuing quality. They weren't done, and they could see they weren't finished and it wasn't right, so we were going to keep working on it until it was finished and it was right."

AIAS nominees announced

Nathan Drake and a rather evil super computer (and sometime potato) have topped the nominees for the 15th annual Academy of Interactive Arts & Sciences (AIAS) awards. CESspotlight_3d_Uncharted-3

"Uncharted 3: Drake’s Deception" led this year's nods with 12 nominations, while "Portal 2" got 10. Other multiple award nominees included "L.A. Noire" (with nine), "Batman: Arkham City," "Battlefield 3" and "The Elder Scrolls V: Skyrim," which all got six.

The awards, one of the more prestigious in the gaming industry, will be handed out on Feb 5 during the D.I.C.E. summit in Las Vegas in a ceremony hosted by actor Jay Mohr. CBS-owned gaming site GameSpot has been named as an exclusive partner and will stream the awards live online.

The complete list of nominees can be found after the break.

Continue reading " AIAS nominees announced " »


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About

Chris Morris reports on the the intersection of Hollywood and technology, as well as the latest must-have consumer technology gadgets.
Tips and feedback are encouraged at chris.r.morris-at-gmail-com

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