Activision, MTV set for ‘Guitar’ war

Entertainment giants face off in gaming battle

Two entertainment giants are about to face off in their own battle of the bands.

Activision and MTV are sinking hundreds of millions of dollars into their own follow-ups to “Guitar Hero,” the smash vidgame hit that lets players simulate their favorite rock god while they strum along on a guitar-shaped controller with virtual chords.

Through July, “Guitar Hero” and a sequel have sold 5 million units in the U.S. alone, generating even more revenue than a typical game because of the guitar controller.

Its success sent big players scrambling to buy the game’s independent publisher, RedOctane, and developer, Harmonix.

As it turned out, one company didn’t buy both.

Activision got Red Octane for some $100 million, but MTV swooped in and bought Harmonix for a staggering $175 million. That means that Activision got the right to make games with the “Guitar Hero” title, but MTV got all the technology that is used to make “Guitar Hero” work along with the people who built it.

The result is a fall season that will see two similar games in cutthroat competition.

Activision is introducing “Guitar Hero 3,” having enlisted developer Neversoft, known for making the “Tony Hawk” skateboarding games.

MTV, meanwhile, is creating an entirely new game via Harmonix called “Rock Band,” spending tens of millions to launch the franchise. Electronic Arts is distributing the game and helping with its marketing, but MTV fully funded its production. In fact, it represents the first time a cable network has published a console game.

“This is a huge investment for us and everybody here has made the decision to be fully committed to the risk and the benefit,” says Jeff Yapp, exec VP MTV program enterprises, who is overseeing the vidgame project for the network. “We see this as a way to change the way people engage with music, which is a place MTV should be.”

“Rock Band” essentially turns “Guitar Hero” into a social experience. It lets up to four players join together to simulate playing guitar, bass and drums as well as perform as lead singer. It adds a playable drum kit and mike to the equation and also lets band members join up online. MTV will continually update the game with new songs available for download on a weekly basis.

” ‘Rock Band’ is the game we have been dreaming of for many years,” says Harmonix topper Alex Rigopulos, whose company struggled for more than a decade before breaking out with “Guitar Hero.” “If we had pitched it to publishers a few years ago we would have been laughed out of the room.”

Because of the success of “Guitar Hero,” Rigopulos could have gotten any vidgame publisher to pay millions to make any game he wanted. MTV, however, offered not only a huge pile of cash, but it shared the same goal of wanting to gain a foothold in the world of videogames. It’s where so much of the network’s target demo spends its entertainment time.

“After ‘Guitar Hero,’ we had a lot of interest among publishers, but MTV really got that Harmonix is a music company first and a game company second,” Rigopulos says.

“Rock Band” came out of the industry confab E3 in July with better critical reviews than “Guitar Hero 3,” which essentially just adds new songs and several new features to the existing “Guitar Hero” formula.

But Activision’s sequel has a number of advantages. Not only is “Guitar Hero 3” much better known, but it will be available around the world and on all major consoles this holiday season.

“Rock Band,” by contrast, will only come out for the Playstation 3 and Xbox 360 in time for the holiday season. Rigopulos promises other markets will get the game early in 2008 and that versions for the other consoles, most likely the Wii and Playstation 2, are also in the works.

But the greater complexity of developing “Rock Band,” and the challenge of manufacturing a new drum kit peripheral, give “Guitar Hero 3” a big lead for holiday 2007.

“We’re going to be in every store in every country in every format and have two years of experience working out the supply chain for our peripherals,” says Bobby Kotick, Activision’s CEO. “There’s also the issue of whether collaborative play will be appealing to the average audience member.”

Kotick also questions how well EA and MTV will get along as they try to support the “Rock Band” franchise going forward.

“Music games are a big category and inevitably EA will not only want to be in it, but be in it with more than just distribution margins,” he notes.

There’s also the issue of price. Though MTV hasn’t announced what consumers will pay, a full “Rock Band” suite complete with two guitars, a drum kit and microphone will surely be well over $100 (though players can use an existing “Guitar Hero” guitar for the game).

Regardless of how the competition goes this holiday season, however, Rigopulos and Yapp both insist they’re committed for the long run.

“We have huge plans for ‘Rock Band’ and its expansions and way more other projects we would love to work on than we can possibly even do,” says Rigopulos.

Adds Yapp: “Harmonix was a very big first step for us in gaming, but there are other genres we’re very interested in getting into and other development opportunities we’re pursuing that I think will astound a lot of people.”

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