GameTap runs dry for Time Warner

It was just three years ago, when I was a relatively fresh reporter covering videogames for Variety, that I wrote with a colleague that Turner was making "a surprising jump into the videogame biz."

At the time, executive VP of business development said that Time Warner division Turner, which operates TBS, TNT, the Cartoon Network, and other cable stations, was "looking to replicate our business model with the next best thing -- games."

The basic business model was, and is, that subscribers would pay $10 per month to access hundreds of games on the Web -- mostly classics from the arcades and earlier consoles. Since then things have changed a bit. It started introducing original episodic games like "Sam and Max" (pictured left). It launched, and then shut down, GameTap TV -- a video offering with original stuff like a new "Tomb Raider" cartoon and even original episodes of "Space Ghost: Coast to Coast." Last year it even briefly had an editorial section that competed with IGN, GameSpot, etc.

Turner never revealed subscription numbers, but my sense is that while GameTap was far from a disaster, it never achieved the kind of scale the company was hoping for. Efforts to grow the brand beyond subscriptions, like the editorial and video, failed. And it was never effectively integrated into other parts of Turner, not even Cartoon Network's Adult Swim, which is aimed at a similar demo.

So perhaps it's not surprising that Time Warner is moving on. In today's earnings, the conglomerate revealed that it has taken an $18 million impairment charge for GameTap. Essentially, that means it was calculating GameTap as being worth $18 million more than it now thinks it is, or it now thinks it can sell it for. Again, not a big success, but given that it has been around for three years and surely spent much more than $18 million, not a debacle.

It's worth noting that Turner is in general pulling back on its separate digital brands. Just recently it decided to shut down SuperDeluxe, the comedy video website it launched in 2007.

Turner's corporate statement on the matter isn't enlightening at all, but for what it's worth:

There is considerable marketplace interest in the GameTap business and brand.  We are considering various strategic options but have reached no final agreement as yet.

Online gaming is a growing business and there's increasing interest in episodic content, not to mention that Turner has spent plenty building gamer awareness of the GameTap brand, so I think it's very likely Time Warner will find a buyer. For GameTap's sake, hopefully it'll be somebody with a stronger commitment to the videogame business.

One obvious question: I wonder if anybody at Time Warner ever thought about folding GameTap into Warner Bros. Interactive Entertainment (the studio's videogame division). Not sure if WBIE would have wanted it, but it seems like it would have been a better strategic fit than Turner, at least. However I'm told by a source that such a move was never seriously considered.