Last week, Square Enix in a release to investors announced that they were parting ways with IO Interactive, looking for possible buyers for the talented Danish studio. What ended being a surprise, given that they announced record net-sales and an increase in profit driven by the releases of Final Fantasy XV and Rise of the Tomb Raider to the PS4.
What no one could expect was the decision to sell the studio behind the Hitman franchise. Especially after the good reception from critics, being nominated for several game of the year awards. But what could motivate the company to sell a well-regarded studio, especially if they are not in a dangerous financial condition? Let’s talk about it.
Hitman Needed to Be Bigger
The first reason behind this decision could be one that may not be that pleasant, but the truth is that the Hitman series isn’t as big as it needs to be. The studio doesn’t really have a juggernaut in their hands, at least not commercially. Their two main franchises, Kane & Lynch, is now defunct for years after the Dog Days debacle, and Hitman, never reached the same height that other games in the same genre did.
Whereas Splinter Cell managed to sell several millions of copies, the Metal Gear series is one of the most important, successful and influential in the industry, Hitman always seemed to be smaller, more focused on a niche, never rivaling with the bigger players. Efforts like the movies also didn’t elevate the status of the franchise, with both movies underperforming, failing to reach the $100 million mark at the box office.
It has a faithful following, with passionate fans that love the more open-ended nature of the title, something that became its trademark. But sales never reached the 5 million mark, slowly decreasing with every launch, with Absolution being heavily criticized by fans due to a simplification of the stealth system, despite posting respectable sales numbers.
The Stealth Genre Has Seen Better Days
The genre in which it is part of is also going through a crisis, the Splinter Cell series is currently on hiatus since the release of Blacklist, that failed to meet Ubisoft’s expectations, selling 2 million copies despite a significant investment of the publisher.
Franchises like Assassin’s Creed went on to grow after it started to abandon its stealth roots, Dishonored 2 had underwhelming sales even though critically it was extremely well-received. Other Square Enix franchises with a heavy focus on stealth are struggling, like Thief, that went through a failed reboot, being critically panned and with weak sales, essentially killing it.
The Deus EX franchise is on hold after Mankind Divided failed to attract attention in the market, again with a good critical reception, but a lukewarm from the public. Something that seemed to happen with the 2016 Hitman reboot, that innovated using an episodic model for an AAA title.
With each new level showing the quality of the studio, managing to find an audience, and accruing praise, being nominated for game of the year awards by several outlets. But unable to translate it to significant sales. Feeling like it was part of a bubble, that adored the game, but never reached the mainstream awareness to be considered successful.
Square Enix’s Strategy is Changing
Even though it remains as an important publisher in the industry, the company has been taking some hits in the past few years, with interesting titles that look as if they never reach their full potential. As the aforementioned franchises, Just Cause appeals to a smaller audience, even their biggest ones like Tomb Raider, struggled to compete with its release on Xbox One with Fallout, despite being an amazing game, and Final Fantasy XV looked like a last try to bring the franchise to its golden years, that fortunately worked.
In the same release, the company revealed its plans to focus on 1-2 AAA titles per year, multi-platform games, remasters, showing a more conservative approach to the market. Their partnership with Marvel to produce an Avengers and another unannounced game comes to fill the space of their IP’s that haven’t performed as expected.
Dropping a studio like IO seems to be an effective way to diminish its structure, becoming a leaner and more focused company. Reports that the studio may retain the IP only seems to corroborate the fact that they want to have a smaller but more significant portfolio.
But there should be many suitors to buy them, and I thought about some companies that could benefit from their talents, and the IP itself. Thinking about the possibilities, four stood out:
Amazon Game Studios: With their own engine, they could use a studio that has produced quality titles, and is battle-tested. Recently they have made some moves, bringing a former creative director of the Need For Speed series, bringing IO and Hitman to their portfolio would be a very interesting move.
Deep Silver: They have tried to become one of the biggest players in the market, and they showed some promise with Saint’s Row and the Metro series. But unfortunately, they’ve had more hits than misses lately, with the abysmal Homefront: The Revolution and the questionable Mighty No. 9. It would show that they are looking into becoming serious players in the market.
THQ Nordic: Their efforts seem a little unfocused, announcing several smaller titles that don’t really appear to entice the market. However, they have announced Darksiders III, another beloved franchise that could end up growing, and bringing an established franchise could cement them as an up and coming publisher.
Microsoft: This is the one that makes the most sense to me, after closing some studios recently, like Lionhead, and canceling several titles, their first-party situation looks bleak. The Forza, Gears, Halo combination hasn’t been able to please the market and is beginning to look weak when compared to its competitors. In a participation on Unlocked #285, Phil Spencer talked about revamping their first-party studios, and this could be an important move, showing to their consumers that they think about the future of the brand. And they could use IO’s talent to either continue the Hitman series, that wouldn’t be required to sell as much in this kind of environment and would fill a void in their portfolio or even create a new AAA IP.
What the future holds for IO nobody knows, but that there’s no doubt that they have a bright one.