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Midway Games Fighting for Its Life


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by Garnett Lee

 

Financial concerns have mounted for Midway over the last couple of weeks.

 

First came word that the company had reached agreements with licensing partners to cancel future versions of unnamed games. Matt Booty, Midway's interim CEO and president, put a positive spin on the move in a press release, saying that it's "a very positive step as we continue to review Midway's involvement with underperforming projects." But losing licensed titles still seems troubling to the average observer -- not to mention that the move incurred a charge off against earnings (but did not cost any cash out of pocket) that ballooned the company's estimated third-quarter loss another 40 percent bringing it up to 70 cents per share.

 

On the heels of this news, a recent Forbes.com article revealed that Midway Games shed 12 percent of its value Monday -- and noted that the company's lost an estimated $580 million since 1999. The stock fell again Tuesday, dropping below the $1 mark to close at 79 cents a share -- adding more fuel to the burning question of whether Midway can continue to survive.

 

While the company's currently in its quiet period leading up to the official earnings report expected the first week in November, Geoff Mogilner, Midway's director of corporate communications, provided 1UP as much insight as he could on the situation. With regard to the canceled franchises, he echoes the positive tone of the press release, pointing out that this approach frees up money that Midway plans to use to develop new intellectual properties, either through publishing deals or by increasing investment in its internal studios. He even went so far as to say that they are "very active in pursuing new IPs" right now. Of the canceled projects, he says that they were last-gen relationships that simply didn't make viable economic sense anymore.

 

Mogilner remains necessarily mum on the matter of Midway's flagging stock, but he does say that the company stays on top of the price. No surprise there -- in this current economic climate, it's a safe bet that most executives are keeping close tabs on their company's daily market value. Turning an eye to the company's future, Mogilner drew particular attention to this November's Mortal Kombat vs DC Universe as the key to potentially stop the economic bleeding. But he says it's not just a sales issue, claiming that "Mortal Kombat vs DC Universe can push people looking at Midway to rebuild their confidence in us." Because the game's built on Midway's core tech platform (based on Unreal Engine 3), Mogilner feels this renewed confidence could extend beyond customers to the company's other partners throughout the industry.

 

That puts an awful lot of pressure on this upcoming installment of the Mortal Kombat series, but perhaps no other entry's been as well equipped to handle such a daunting task. The addition of the DC Universe characters opens the door to a new demographic, and the DC property also brings a Teen ESRB rating -- more consumer-friendly than the series' usual entries, which are usually slapped with Mature ratings due to the over-the-top bloodshed and mayhem. That could go a long way toward helping moms and dads feel comfortable with it as a gift for their children this holiday season. Put those two factors together, and this MK could be the most financially successful in quite some time. All that remains now is for the game to prove itself up to the task. For Midway, "Mortal Kombat" has never been so true.

 

Source: http://www.pcmag.com/article2/0,2817,2333168,00.asp

Can Mortal Kombat vs. DC Universe be Midway's redeeming factor or make them plummet back down to the ground and out cold? Post your thoughts.

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Pooh pooh to your pessimism.

 

I lament the day Midway will die out. I hope they can find a way out of this mess. It won't be one title that saves them though - it has to be a consistent couple.

 

Midway have still got alot to contribute to the games industry - they are the type of game makers that make alternatives to your Tekkens, Virtua Fighters and Street Fighter Alpha Beta Ultra Special Championship Edition Turbo Hyperfight.

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Pooh pooh to your pessimism.

I lament the day Midway will die out. I hope they can find a way out of this mess. It won't be one title that saves them though - it has to be a consistent couple.

Midway have still got alot to contribute to the games industry - they are the type of game makers that make alternatives to your Tekkens, Virtua Fighters and Street Fighter Alpha Beta Ultra Special Championship Edition Turbo Hyperfight.

 

That use to be my view point years ago, Mortal Kombat fighting games aren't very abysmal, all of the fighting games you mentioned actually have stable fighting systems. Those games are worthy tournament fighters, Mortal Kombat was an alternative to the games that were out, in 1992, nowadays, people go for very substantial fighting games, MK isn't one of them.

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Could their medicore games help them survive? Definately, look at Atari. They managed to get out of the red because of release of Witcher and Alone in the Dark 5. Even the scene were asking to buy Atari games. The scene asking pirates to buy these games.

 

They'll no doubt do the same again.

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I remember Midway releasing Shadow Hearts: covenant in Europe, but alas they just acted as a publisher. Outside of that, I haven't really seen games with the Midway logo in there somewhere.

 

EDIT: I take that back. According to GameFAQs, Midway has released tons of games for all platforms. Only a handful of those games are worth one's time, though. Lot's of canceled games, too.

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