High School Musical soaring, Ratatouille bombing: the latest in kids' game sales

Most videogame blog readers aren’t particularly interested in kids’ games, for obvious reasons. But as data has come in for 2007 sales, some really interesting stories have emerged.

THQ has grown its business on large part on kids licenses in the past few years, primarily based on Nickelodeon Shows and Pixar movies. But as part of a disappointing holiday earnings report that saw net income fall 75% to $15.5 million, neither license worked. “In a very competitive year for kids titles, ‘Ratatouille’ and our Nickelodeon titles did not perform to forecast,” CEO Brian Farrell said succinctly on a conference call with analysts.

(It’s worth noting that Disney/Pixar in general had trouble licensing “Ratatouille” products, since the main character is a not-so-adorable rodent It’s also worth noting that last year’s “Cars” continues to be a huge success. THQ specifically mentioned follow-up game “Cars: Mater-National” as a solid seller.)

So if Nickelodeon and Pixar didn’t work in kids games this year, what did? The same things as on TV and, as we just saw this week, the movies: “Hannah Montana” and “High School Musical.” That’s good news for Disney Interactive Studios, which has been on a bit of a tear recently, underneath the radar of many of the mainstream game press.

Take a look at these statements from the Walt Disney Company’s earnings report, released yesterday: “[Consumer products] operating income growth was primarily due to increases at Merchandise Licensing and Disney Interactive Studios… The growth at Disney Interactive Studios was primarily due to the success of new self-published titles based on 'High School Musical' and 'Hannah Montana'  in the current quarter, partially offset by higher video game development costs.”

Just last week, as part of a press release announcing a spring date for its third “High School Musical” game in under a year, DIS noted that it shipped 3.8 million units of the previous two in 2007. That’s a hell of a lot of games, and a very healthy business considering that, based on what I’ve seen, the development costs were probably a fraction of  typical best-selling titles.

Ironically, a lot of people have noted how Disney Interactive seemed to be in a bad situation since the most valuable titles in its parent company’s library – the Pixar pics – have been licensed out. Last year, however, DIS turned out to have the right film and TV properties  at the right time.

[That being said, it's widely expected that when THQ’s deal expires in 2010, Disney Interactive will eagerly start handling the Pixar games.]