MTV owner to sell Rock Band maker

By | Published on Friday 12 November 2010

MTV owner Viacom has announced it is putting loss-making video game developer Harmonix, best known for the ‘Rock Band’ franchise, up for sale.

Viacom bought Harmonix back in 2006 and since then the music-focused gaming firm has operated as part of MTV Games. Having been one of the companies originally behind the ‘Guitar Hero’ game, which is now owned by Activision, Harmonix’s main project since becoming a spin off of MTV has been to develop the rival ‘Rock Band’ series.

Although a successful gaming franchise, arguably ‘Rock Band’ has never quite caught up with ‘Guitar Hero’, certainly outside the US. Even when the Harmonix game scored the considerable coup that was an official artist tie up with The Beatles, the latest generic edition of ‘Guitar Hero’ still outperformed the special ‘Rock Band’ release in terms of sales.

Viacom CEO Phillippe Dauman was pretty candid when confirming his intent to sell Harmonix, for which his company originally paid $175 million, admitting MTV had never quite worked out how to make money from the gaming business. He told investors: “The console games business requires an expertise and scale that we don’t have, so we have taken steps to sell Harmonix and we are in discussions with several potential buyers”

Harmonix, for its part, insists it is business as usual, and says it will continue to enjoy the support of Viacom while its parent looks for a buyer.

Like most media companies, Viacom has been struggling of late, though its latest quarterly financial report, with income of $461 million on revenues of $3.3 billion, was generally well received by investment types, who also welcomed Dauman’s decision to bail on Harmonix. The CEO said his strategy for the short-term future was to concentrate on areas where Viacom’s expertise is strongest, which is, in his mind, “branded entertainment content delivered through a variety of platforms”.

Given that the one time we called MTV’s London HQ to ask a question about the Rock Band Network none of the eight people we spoke to there, including marketing and PR execs, had ever even heard of MTV Games or Harmonix, I don’t suppose this announcement will mean much to most people working in the MTV empire, though more recently the media company had launched a specific Europe base for its gaming division, and it’s not clear what will now happen to that.