The video game industry is splintering into the haves and the have-nots. THQ Inc. falls in the less fortunate camp.

The Calabasas publisher was at the top of its game two years ago. The company’s $68-million profit and $1 billion in revenue put it within striking distance of crosstown rival Activision Inc. THQ released an ambitious plan to expand its game lineup and began acquiring development studios across the country.

But now it’s in retreat as it loses ground to publishers such as Nintendo and Activision, which strengthened through last year’s merger with Vivendi’s Blizzard Entertainment.

& #8226;

Read the full

Los Angeles Times

story.