Interplay is on the brink of financial Fallout, according to a report it filed with the U.S. Securities and Exchange Commission in May.
Interplay is $2.9 million in debt and has only $3,000 in cash. The company is forced to now consider a grim list of outcomes: Liquidating its assets, selling the company, filing for bankruptcy or continuing to function with no hope of earning a profit or protecting its stockholders.
“These conditions, combined with our historical operating losses and our deficits in stockholders’ equity and working capital, raise substantial doubt about our ability to continue as a going concern,” Interplay wrote in the report discovered by Develop.
The report revealed Interplay has been operating “without credit agreement or credit facility” since the end of 2010, which “has resulted in a substantial reduction in the cash available to finance [its] operations.”
Interplay currently has no chief financial officer and no longer pays developers up-front for projects, instead using a net-revenue-sharing model that gives studios a percentage of the games’ final sales.
Interplay is in dire trouble, placing its in-development projects at risk of incompletion, including the MMO Fallout Online, ClayFighter for DSiWare, Descent for WiiWare and Earthworm Jim 4, among plans to produce 3DS and Facebook games, and to promote indie games on a larger scale through Interplay Discovery.
Interplay is “negotiating a payment plan” with federal and California state groups to which it owes money, which includes $410,000 in payroll taxes to the IRS.
In summary, Interplay wrote, “No assurance can be given that funding can be obtained by us on acceptable terms, or at all.”
How do you think Interplay ended up in this monetary mess–in the report, it cites piracy and weak IP laws as industry risks that harm its business. Is this a valid complaint or is Interplay pandering to popular gaming controversy?
Interplay is on the _brink_ of financial _Fallout_
For a developer to succeed they have to make good games, if people hear a game is good then they will be more likely to buy the game rather then pirate a game there unsure about.
I am not a fan of companies going under (see Pandemic), but I actually see some good coming out of this. Fallout 3 is my favorite game of all time, and last time I checked, Interplay was in a dispute with Bethesda over the license. Nothing is more important to me as a gamer than seeing Fallout 4 from Bethesda. With Interplay out of the fold, that should happen. Hopefully Bethesda buys all the rights to Fallout.
If all this comes to true, I’ll just be waiting on a sequel to Red Dead Redemption (my 2nd favorite game of all time)!