THQ (Nasdaq: THQI) is turning to the toy closet for some video gaming sizzle. The video game developer and publisher is entering into a multiyear licensing deal with Mattel (NYSE: MAT) to turn the plaything maker's biggest properties into interactive diversions.

Barbie, Hot Wheels, and even Rock 'Em, Sock 'Em Robots will be given gamer makeovers by THQ. It won't be just consoles and handheld gaming units, either. This deal covers mobile apps, computer software, and even social games on Facebook.

THQ can use the boost. It's coming off back-to-back quarterly deficits, and analysts see the gamer posting a small loss in its fiscal year ending in March.

Larger publishers Activision Blizzard (Nasdaq: ATVI), Electronic Arts (Nasdaq: ERTS), and Take-Two Interactive (Nasdaq: TTWO) are all expected to have delivered healthy earnings growth in their most recent years. Even GameStop (NYSE: GME) is growing its profitability. In other words, THQ can't blame weak industry sales over the past two years for its fall.

THQ's weakness is that it has largely relied on licensed properties for its games. It's a strategy that provides instant brand recognition, but often at the expense of lower margins since the intellectual property owners take a generous cut. Obviously, this Mattel deal is yet another licensing deal, but THQ's approach appears to be that it can make up any shortcomings in volume.

It will be interesting to see what THQ does with this deal. There have been plenty of Barbie and Hot Wheels video games cranked out over the years. Given the subject matter, it's not really a surprise to see that the games are usually simplistic titles geared toward the younger set. If THQ is going to go down this same path, why bother? The real challenge would be to attempt an updated reboot. Rival Hasbro's (NYSE: HAS) Transformers and GI Joe seem more relevant now to older -- and perhaps nostalgic -- gamers after being transformed into cinematic blockbusters.

Can THQ help Mattel perform a similar feat? There will have to be broader appeal if THQ wants to crank out Mattel games on social networks that block out kids and preteens. There aren't too many toddlers with smartphones, either.

If THQ is aiming high, this deal will pay off handsomely.

Can Mattel work as a gaming clay for older gamers? Share your thoughts in the comment box below.

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Longtime Fool contributor Rick Munarriz loves playing video games but he doesn't own shares in any of the companies mentioned in this story. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.