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Angry Birds products are displayed during a news conference in Hong Kong in this file photo.© Bobby Yip / Reuters

To revive Angry Birds, the maker of the five-year-old mobile game is betting on Hollywood.

Pekka Rantala, the new chief executive officer of Finland's Rovio Entertainment Oy, is accelerating the game studio's transformation into an entertainment company focusing on plush toys and cartoons. The strategy largely hinges on a 3-D Angry Birds movie coming out in May next year, which Rovio is spending more than $180-million developing and marketing.

Rantala is banking on the film's appeal to reverse falling sales and profit at the closely held company, which hasn't produced new brands to match Angry Birds' success. Revenue in 2014 fell 8.8 per cent from a year earlier to €158.3-million ($170-million). Earnings before interest, taxes, depreciation and amortization dropped 56 per cent to €17-million.

"We aren't anymore a games company," Rantala, 49, said in an interview in London this week. "We're so much more than just a games company, but at the same time we have a deep brand with the Angry Birds franchise."

The movie has some big names attached to it. Actor Peter Dinklage, who's appeared on HBO hit Game of Thrones, will voice one of the characters. Rovio's also recruited David Maisel, the former chairman of Marvel Studios, and Jon Vitti, who wrote for The Simpsons. Sony Pictures Entertainment Inc. has agreed to distribute the movie globally.

Rovio targets a return to sales growth in 2015 and predicts bigger gains for next year as it signs licensing agreements from the film, said Rantala, a former Nokia Oyj executive who took over in January. Once the company is growing again, it may consider plans for an initial public offering, he said.

'A Phenomenon'

It's hard for a game maker to maintain momentum after a hit. Zynga Inc.'s revenue nearly doubled between 2010 and 2011 as its FarmVille game took off, and then dropped by about half between 2012 and the end of last year. Rovio had released more than 50 games before it struck gold with the mesmerizing physics in Angry Birds, where users slingshot birds into towers filled with smirking pigs.

"It's a very difficult business model," said Caroline Wiertz, who teaches marketing at Cass Business School at City University in London. "It's a phenomenon and people get tired of it and move on to the next thing."

Rovio's game revenue grew 16 per cent last year as it added Angry Birds versions and partnerships in Asia. The drop came from consumer products. Still, Rantala is deepening a focus on licensing revenue from products such as toys, soda and clothing.

With the new movie, Rovio decided not to sell the rights to a studio, allowing the company to keep the cash from tickets and merchandise. That should refresh licensing revenue and cement Rovio's status as an entertainment company, Rantala said.

"We can make the company grow again," Rantala said. "This is a journey."

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