Going into the summer, it appeared that the holiday video game season would be jam-packed with aspiring street racers. After all, Motley Fool Stock Advisor holding Electronic Arts' (NASDAQ:ERTS) Need for Speed Underground capitalized on The Fast and the Furious-ignited explosion in the popularity of import car culture and street racing to become the best-selling video game of them all last holiday season. Naturally, everybody else wanted a piece.
But now it seems that the competition has been postponed.
Last week, video game developer and publisher THQ (NASDAQ:THQI) announced that it had picked up the rights to the promising street racer Juiced from the now-bankrupt Acclaim. The game had originally been scheduled for release on the Sony (NYSE:SNE) PlayStation 2 and Microsoft (NASDAQ:MSFT) Xbox early last month; in fact, several magazines -- including PSM and Electronic Gaming Monthly -- had already published reviews. Instead, Acclaim filed for bankruptcy before then, leaving the game up for grabs.
According to GameSpot, THQ outbid a list of competitors that included Take-Two Interactive (NASDAQ:TTWO), Midway Games (NYSE:MWY), Namco, Atari (NASDAQ:ATAR), and Electronic Arts. The deal is worth up to $10.5 million, which includes potential royalties on game sales.
Since it's set to close in November, the deal also significantly affected the competitive dynamic of the release. As such, THQ announced that the release of Juiced would be delayed until summer 2005.
EA's Need for Speed Underground 2 (NFS2) was the heavy favorite among the pure street racers but is due for release in mid-November. To get a head start, Namco opened the season by releasing its Street Racing Syndicate at the end of August. In what would have been perfect timing, Juiced was to be released a week later. However, the release of Take-Two's Midnight Club 3: Dub Edition -- the other big competitor -- got pushed back until January, and now Juiced has also been delayed until next summer.
So the big holiday street race isn't happening after all.
There are a couple of ramifications here.
One is that EA is left to basically rule this turf once again this holiday season. While Sony's Gran Turismo 4 will be in a class of its own as a simulator for every car enthusiast, EA's NFS2 will dominate its corner as an arcade-style street racer for those who want to trick out the appearance of their video game rides and for those who are just into the scene, as well as for those who are into drifting (an increasingly popular sport where you basically drive sideways at 80 mph or so around a course and get scored based on style).
As for THQ -- a company known for its success with games aimed at a younger audience -- Juiced should add a boost to the company's strengthening portfolio of more mature games. In addition, Juiced got good-but-not-great reviews; by delaying the release until next summer, THQ is afforded a chance to refine the game. Perhaps more importantly, the game will be released at a time where it's not going head to head with EA's NFS2, Gran Turismo 4, and other impossible competition (see Timing Is Everything).
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Fool contributor Jeff Hwang owns shares of Electronic Arts. Fool co-founder David Gardner first recommended Electronic Arts in Motley Fool Stock Advisor in May 2002. Since then, the stock has risen 48.9% vs. a 1.2% gain of the S&P.
