Iron Lore Entertainment Closure Interview

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In late February, Iron Lore Entertainment made the announcement we were optimistically hoping would never come - the young development studio was shutting down. Despite releasing both Titan Quest and Titan Quest: Immortal Throne to favorable reviews and contributing to THQ and Relic's popular Warhammer 40,000: Dawn of War: Soulstorm expansion, the team simply found themselves without the financial backing necessary to continue operating. To learn more about the circumstances surrounding the closure and how the state of PC gaming may have contributed to it, we had a quick chat with Iron Lore co-founder Paul Chieffo:

GB: Iron Lore Entertainment's closure came as quite a surprise, at least to those of us on the outside. What exactly went wrong?

Paul: The short answer is that we were unable to secure a follow on contract to Dawn of War - Soulstorm and were therefore unable to continue as a company. We essentially got caught in the gap between projects, which is always a risk for developers because any potential backend revenue due to royalties comes long after a project ships, if at all, while payroll is needed immediately, of course. So to survive, a developer must bring in a steady stream of projects, and if the gap is slightly too long between the ending of the current project and the start of a new one, you're toast. That's essentially what happened to us. We had a very exciting project we were pitching to publishers and getting a lot of interest in, but late last year several interested parties abruptly dropped out for various reasons. There was still interest from other parties, but we were unable to close a deal with them before the money ran out.

GB: When did it become apparent that you might be forced to shut the studio down and how were the employees notified? What was the general mood around the office in the days leading up to the closure?

Paul: We kept the employees in the loop with regular meetings and special meetings whenever there was a significant event in the sales process. Our experience is unfortunately not that atypical for a developer - it can be a risky business. We all knew that, so we tried to keep everyone up to date as much as possible on the ups and downs as we went along. It was quite a roller coaster in the last few weeks, as we were pulling out all of the stops to find interim projects and any other sources of funding to bridge the gap. Our team was absolutely fantastic, as always, and stuck with Iron Lore until the very end. We didn't lose a single person, even when things were looking grim in the last few weeks. It's one of the things I'm saddest about in this whole thing - that such an incredibly talented, dedicated, and passionate team had to break up.

Given all of that, the mood of the company was all over the place. We were all hoping we could pull it out, and when we would get good news or it looked like we unearthed a project that was going to save us everyone was pumped. But then there would be a snag, or the project would fall through and we'd be disappointed. This continued right to the bitter end, as we were doing everything we possibly could to save the company. When time finally ran out, I think we were all a little bit in shock.

GB: With Iron Lore shut down, what's next for Brian Sullivan and other long-time veterans on the team? Have Brian or any other key members already secured jobs with other video game developers?

Paul: Almost everyone on the team has found positions with other developers. They are top-notch developers so there was little thought that this would be a problem. In addition, the Boston area game development community is doing quite well right now, and there are a lot of open positions. Brian and I will still be working here at Iron Lore for awhile. There's actually a lot of work involved in shutting down a company and we'll be at it for a couple more months at least. After that - who knows?

GB: THQ's Michael Fitch recently vented his frustration about the rampant amount of piracy on the PC. Would you say that piracy of Titan Quest was a contributing factor to Iron Lore's closing?

Paul: Well, I think that Michael's point is correct. That is, if we had realized more revenue from Titan Quest then we would have been in better financial shape, and it would have been more likely that we would have made Titan Quest 2 with THQ. If that had happened, we obviously would still be in business. So I would agree that it was an indirect reason, something that had a lot to do with the overall situation the company was in.

I also agree with him that piracy in general is a huge problem for the PC market. Despite the huge profits made by hit games, in general it's a tough business in which to make money both for publishers and developers. There just isn't much margin for losing revenue, and I think that is a significant factor in the move away from the PC platform. And that's only talking about established markets like the US and Europe. There are huge areas of the world where there would be viable markets except for the fact that piracy makes them untenable. For example, Titan Quest was one of the top selling games in Russia last year, but no significant revenue was generated from that. Why? Because the game has to be sold for a pittance due to rampant piracy.

So I completely agree with Michael that it's a huge problem for the industry. And unfortunately it's a problem with no good solution at the moment. If you read many of the comment threads on Michael's post it's clear that the current DRM solutions are very frustrating for the customers, and not very effective. That's why we removed copy protection from Titan Quest in a patch, and shipped Immortal Throne without it. Unfortunately we paid a price for that as well, as Immortal Throne was leaked a week before it hit the shelves and that sure didn't help our sales. Right now it's a bad situation for everyone: gamers, developers, and publishers alike.

GB: What do you think could have been done differently to ensure that Iron Lore would be able to continue operating for years to come? Do you think an Xbox 360 or PlayStation 3 port of Titan Quest might have helped?

Paul: We actually had discussions about just such a project, but ultimately it didn't see the light of day. We were in the process of moving to the console, and were showing a demo of our new product on the 360. It's a difficult transition though, and that undoubtedly made our sales cycle more difficult.

GB: How about a Titan Quest II? Was such a sequel ever considered or possibly even in development prior to the studio's closing?

Paul: It was talked about, and was a project we really wanted to do, but all I can say with certainty that Iron Lore won't be developing it :) Beyond that, as the owner of the property, the future of Titan Quest is up to THQ.

GB: Who actually owns the Titan Quest IP? Is there any chance that it could be sold to another developer or otherwise revisited sometime in the future?

Paul: THQ owns the IP. All that you mention is possible, it's entirely at their discretion.

GB: Is there anything else you'd like to add about the closure, the future of Titan Quest, or even the state of PC gaming?

Paul: I'd just like to say thank you to everyone who played and enjoyed our games. It was incredibly rewarding for us to be able to create products that people found fun. I only wish it could have continued longer.

Thanks for creating one of the best action RPGs in existence, Paul. We certainly wish the best for you and the rest of the team going forward.