MTV Selling “Rock Band”, Going Back To Having Little Or Nothing To Do With Music 

Less than three weeks after the launch of Rock Band 3, the latest installment in a franchise most of us thought was a smash hit, Harmonix is being put up for sale by Viacom/MTV Games. And Wired's interpretation of Viacom's balance sheet implies that it's not because they just got bored of being in the video game business:

To use the popular Internet acronym: IANAA (I am not an accountant) but there does seem to be some telling info in the financial statement linked above. Viacom mentioned that Harmonix has been shifted to the “discontinued operations” section of its balance sheet. That section shows a $37 million loss for the first nine months of 2009, and a $321 million loss for the first nine months of 2010.

We don’t know what other operations are in that category. But if you go back to last quarter’s financial statement, you can see that the “discontinued operations” segment sans Harmonix was nonexistent in 2009 and turning a tiny, single-digit profit in 2010.

The only things that were new in the Rock Band universe during that time (prior to the release of RB3) were the special Beatles and Green Day editions. One big change since last year's release of The Beatles Rock Band is that whereas Harmonix used to design and manufacture the various guitar/drum controllers themselves, that has now been jobbed out to Mad Catz. I'll also note that while my local Best Buy was packed with both RB2 and Beatles Rock Band hardware last year, this year I can't find a single Rock Band-branded controller except for the brand-new RB3 keytar.

So, my theory: Harmonix's software business is more or less sound—it's their hardware business (i.e., trying to make, ship and sell gigantic $200 full-band sets during a global recession) that did them in.