Activision has shut the doors on Guitar Hero publisher Red Octane today as well as an in-house development studio, Underground Development, a Kotaku report says.

The news arrives in the wake of Activision’s promise to release fewer Guitar Hero titles in 2010 and just weeks after Guitar Hero COO Dan Rosensweig stepped down.

Red Octane, most famous for believing in Harmonix enough to publish the original Guitar Hero, with its plastic guitar peripheral and all, is now gone.

According to Kotaku, about 30-40 have lost their jobs, with the remaining staffers headed to Activision’s Santa Monica offices to work under the fist of the publisher.

Underground Development, the studio responsible for Guitar Hero: Van Halen, got the boot entirely, as Kotaku reports the studio is shut down 100 percent. Gasoline is currently being poured all over the building.

This news is certainly hard to take, as the cynic in me believes if Activision didn’t whore out the franchise as it has in the past years, no one would be out of a job and all studios would remain intact. Ouch.

Source: Kotaku

Guitar Hero Smash Hits, from Activision, Red Octane, Neversoft and all our old GH friends is like any “best of” collection, and offers exactly what you’re expecting, no more no less. If you want a strong variety of solo rhythm game tracks, you would buy a solitary Guitar Hero game, and if you wanted a good, well balanced group rhythm game, you would buy Rock Band because those games are designed with those purposes expressly in mind. You buy Smash Hits for the reason you would buy anything with the word “Hits” in the title: you know what’s on the game already, you like it, and you want it all in one place.

There is a slight contradiction in the idea of a full band game filled solely with songs that were initially chosen for their prominent guitar parts, and because of the need to balance the fun across four controller parts instead of one, the songs that are on the game aren’t necessarily the most fun from Guitar Hero, but are all more or less the most fun for the most people. I was disappointed by the absence of songs like “My Name is Jonas” and “Cliffs of Dover” (both from Guitar Hero III), which have fun parts specifically for the guitar, but would understandably be less fun on the full-band set up. I was particularly disappointed that “Sweet Child O’ Mine” was not on the Smash Hits play list, but to be fair I wouldn’t want to be in a room with somebody trying to sing like Axl Rose. The songs that did make it on to Smash Hits are some of the more well-known from the Guitar Hero repertoire, as well as some of the more challenging (expert-level “Through the Fire and the Flames” is still mind-blowingly impossible, even with the addition of the new neck-slider feature), and most of the songs are pretty well balanced across all four instruments (a notable exception is “YYZ” which doesn’t have a vocal part, but is hella fun on every other count). Unfortunately, there is no downloadable content for Smash Hits to fill in any notable gaps that you might find in the set list, so read the back of the box before you pick it up so you make sure you know what you’re getting.

The game’s mechanics, graphics, and features are very much like a no-frills Guitar Hero World Tour, with comparable character customization, band creation and music studio features. Though the game’s tracks are all master recordings, there are no “celebrity appearances” or boss guitar battles as there have been in past iterations of the franchise (sadly, no Slash, but thankfully no Ted Nugent). Again, this is not the full Guitar Hero experience, just the major bullet points condensed into a single game. If you really want the CG chick from Paramore to play onstage with your Avatar, the other games are what you’re looking for. This game is for the Guitar Hero junkie (that is to say: me) who has “Killer Queen” and “Fire and the Flames” on his iPod and‚  really would like to try the vocal part for once.

With this in mind, Smash Hits does do us all a favor by dispensing with the trouble of unlocking all the songs in career mode before being able to play them casually in quickplay. All the songs are available in quickplay from the get-go, because Activision realizes if you buy this game, you just want to play with your rhythm game addict buddies and want to skip over the easy setting and pop songs and crank some Skynyrd on expert without all the hassle of having to think up a band name and play boring songs for an hour to get there. There is a career mode, but even that is streamlined; more complex set lists are unlocked according to a cumulative score from all available songs rather than just the last setlist you played. This means you can unlock a wider variety of songs through good performance on easier songs, and not just adequate performance on the hardest available setlist.

The gameplay itself the tried and true Guitar Hero model with no real differences. The songs have been updated with some of the more complex note patterns that appeared in World Tour, so there are some slight differences between these songs and their originals on the older Guitar Hero releases. The addition of a few neck-slider bars isn’t enough to make the experience of playing the same songs on a new game completely fresh and revolutionary, but it does keep things from getting boring, and the differences between songs are substantial enough that it shows that Activision didn’t just re-package some old games and try to sucker you in to buying them.

Perhaps the only new addition to the actual gameplay screen is a meter that tells you how many out of five stars you have earned so far in the course of gameplay, and how far you are to earning the next one. If this sounds familiar, it’s because Rock Band has had that feature from the beginning, though I don’t mind it when Guitar Hero tries to be more like Rock Band. There are some of the old Guitar Hero-related irritations like distracting designs on the note highway, or flashes of lightning when you gain star power, but these aren’t any better or worse than they were in World Tour, and have been greatly reduced in scale from earlier versions of the game.

Blast Factor: If you haven’t already decided whether or not you really want Guitar Hero: Smash Hits, you probably don’t. At a full $50 price tag, it costs probably about as much as a used collection of Guitar Hero I, II, and III, or a brand new Rock Band II or World Tour, all of which would offer a greater variety of songs and downloadable content, and would be better especially for newcomers to the rhythm genre. However, if you like what you see and have been dying to play some of these old songs with your rhythm game buddies, then by all means, grab it up, plug it in, and rock out.

Guitar Hero: Smash Hits is available on Xbox 360 and PS3 for $49.99, and on the Wii for $39.99

There will be no stop to the rocking on Guitar Hero: World Tour, assuming you dig downloadable track packs of course. Oh, and acoustic songs. And Paul McCartney in a non-Beatles context. Now that we’ve moved past just guitars in our music games, this isn’t a problem, and is actually a welcome addition to the franchise.

This gives you a chance to turn down the lights, whip out your lighter, and belt out some emotional tunes over the mic while your drummer takes it easy, giving him time to develop that nasty drug habit and leave the band citing “creative differences”. Remember kids, friends don’t let friends turn into drug-addled superstars, so throw your timekeeper a bone and rock out to a metal tune every now and again, won’t you?

In addition to the acoustic songs coming from The Shins (“New Slang”), Incubus (“Drive”), and Ryan Adams (a cover of “Wonderwall”) on February 12, and the three songs from McCartney’s post-Beatles vehicle, Wings (February 19), you’ve got a Bob Seger track pack, which will include “Old Time Rock and Roll”, “Her Strut” and a live version of “Get Out of Denver”, all available for download February 26.

Each pack will run you 440 Microsoft points or $5.49 in non-gamer currency over the Playstation Network. They will also be available as singles for a lower price, and 200 points on the Wii.

From Activision:

GUITAR HERO‚® WORLD TOUR‘S DOWNLOADABLE CONTENT SET LIST CONTINUES TO EXPAND WITH NEW TRACK PACKS IN FEBRUARY

SANTA MONICA, CA – January 27, 2009 – Having already delivered fans over 70 rockin’ downloadable tracks for Activision Publishing, Inc.’s (Nasdaq: ATVI) Guitar Hero‚® World Tour since the game’s October 2008 launch, three new Track Packs spanning a variety of musical genres and multiple artists will be available throughout February 2009 to Guitar Hero‚® fans across the globe.

On February 12th, rockers Incubus, The Shins and Ryan Adams turn off the amps and electric guitars in the Acoustic Track Pack.‚  Coming to Guitar Hero World Tour are Incubus’ “Drive,” The Shins’ “New Slang” and Ryan Adams’ GRAMMY‚® Award nominated version of “Wonderwall.”

Following their debut appearance on disc in Guitar Hero World Tour with “Band on the Run,” Paul McCartney’s Wings return to the Guitar Hero stage with the Wings Track Pack.‚  “Junior’s Farm,” “Hi Hi Hi” and “Jet,” three top-ten hits from the band’s diverse catalog of music, will be available for download on February 19th.

GRAMMY Award winner, Rock and Roll Hall of Fame inductee and Academy Award nominee Bob Seger will make his Guitar Hero downloadable content debut with the Bob Seger Track Pack.‚  After making an appearance in ads highlighting different celebrities jamming on instruments from Guitar Hero World Tour, Seger’s legendary hit “Old Time Rock and Roll” joins “Her Strut” and a live-recording of “Get Out of Denver” in the Bob Seger Track Pack, available for download on February 26^th.

The Acoustic, Wings and Bob Seger Track Packs will be available on Xbox LIVE‚® Marketplace for the Xbox 360‚® video game and entertainment system from Microsoft for 440 Microsoft Points and on the PlayStation‚®Store for the PLAYSTATION‚®3 computer entertainment system for $5.49.‚  The songs in each Track Pack will be released as downloadable singles for Xbox 360 for 160 Microsoft Points, PLAYSTATION 3 system for $1.99 and Wii^TM for 200 Wii Points.

Guitar Hero World Tour transforms music gaming by expanding Guitar Hero’s signature guitar gameplay into a cooperative band experience that combines the most advanced wireless controllers with new revolutionary online* and offline gameplay modes including Band Career and 8-player “Battle of the Bands,” which allows two full bands to compete head-to-head online.‚  The game features a slick newly redesigned guitar controller, drum kit controller and a wired microphone, as well as an innovative Music Studio music creator that lets players compose, record, edit and share their own rock ‘n’ roll anthems.‚  Music creators are also able to share their recordings with their friends online through GHTunes^SM where other gamers can download and play an endless supply of unique creations.

Guitar Hero World Tour is now available for Xbox 360, PLAYSTATION 3 computer entertainment system, the Wii home video game system from Nintendo and the PlayStation‚®2 computer entertainment system. ‚ The game is rated “T” for Teen by the ESRB.‚  For more information on Guitar Hero World Tour, please visit worldtour.guitarhero.com.

About Activision Publishing, Inc.

Headquartered in Santa Monica, California, Activision Publishing, Inc. is a leading worldwide developer, publisher and distributor of interactive entertainment and leisure products.

Activision maintains operations in the U.S., Canada, the United Kingdom, France, Germany, Ireland, Italy, Sweden, Spain, the Netherlands, Australia, Japan and South Korea.‚  More information about Activision and its products can be found on the company’s website, www.activision.com.