RadioShack will implement new strategy in early 2002 that tailors merchandise mix of stores to individual markets, marking major break with cookie-cutter approach that has been chain’s hallmark.

Rent-a-Center (RAC) tentatively agreed to pay $12.2 million to 4,600 female employees as part of proposed settlement of sex discrimination suit filed year ago. Margaret Bunch had filed suit in Dec. 2000 in U.S. Dist. Court, Kansas City, alleging sex discrimination began shortly after Renter’s Choice purchased RAC from Thorn Americas in 1998. RC later changed name to RAC. Settlement covers female workers employed between April 19, 1998, and Oct. 1. Second suit on similar grounds, filed by Claudine Wilfold in Aug. 2000, still is pending in U.S. Dist. Court, St. Louis. Wilfold and 18 other plaintiffs are seeking $410 million in damages. RAC Pres. Mitchell Fadel said proposed settlement was in “best interests” of company “given the costs and uncertainty of litigation.” Gene Graham, attorney for Bunch and others, termed agreement “a fair and favorable resolution of claims that have been vigorously contested.” In addition to monetary settlement, RAC must: (1) Adopt policy against gender discrimination and provide employee training on subject. (2) Eliminate weight lifting requirements. (3) Modify internal procedures for reporting gender discrimination. (4) Add “more comprehensive” recordkeeping for employment applications and promotions.

Rainbow Rentals said 3rd-quarter profit fell 32% to $394,000 (7? per share) from year-earlier $579,000 (10?) on 3.7% lower revenue to $22.7 million and 5.4% decline in same-store sales. Chain said profit was hurt by lower margins, higher ad spending and impact of 4 new store openings. Company said it was pleased with results thus far of “You're the Boss” ad campaign. It also said it expected new pricing structure to “favorably impact” revenue and margins starting early next year.

Infogrames’ Atari brand returns to market this week via PS2 game MXrider shipping in Europe and U.S. Company said title was first game to ship under new Atari banner. Splashdown, also sporting Atari name, will follow next week. Infogrames said that “in a rare move,” it was providing both games with global rollout, releasing them to 15,000 U.S. stores and 23,800 international stores as part of what CEO Bruno Bonnell called “no-holds-barred release” designed to raise awareness of Atari brand’s return.

Double-digit first-half profit declines were reported Wed. by Pioneer and Sharp. But reports were more upbeat than those of other Japanese majors in that, despite dire economic conditions, both expected to complete fiscal year in black.

Lawsuit over copy-protected CD has been filed against BMG Entertainment in Germany, source there told us. Details were scant at our deadline, but suit concerns CD compilation Just the Best 04/2001 that’s said to be copy protected but not labeled as such. Suit is said to charge BMG with fraud, computer fraud and copyright misuse. Computer fraud claim is based on violation of CD Red Book standard under German law, which prohibits damage to “the property of someone by affecting the result of a data processing proceeding, by incorrect design of a program or use of false and incomplete data.”

DVD titles jumped to 20% of Hollywood Entertainment (HE) revenue in 3rd quarter as video dealer reported net income rose to $25.6 million from $18.6 million. Revenue increased to $344.9 million from $306.5 million on 11% gain in same-store sales. DVD accounted for 16% of sales in 2nd quarter and chain now carries 2,000 titles compared with 10,000 VHS releases. Rental revenue was up to $288.3 million from $262 million year, and product sales to $56.5 million from $44.4 million. In conference call with analysts, CEO Mark Wattles again said Hollywood wouldn’t rush to sign DVD revenue-sharing agreements with studios, citing $17 cost for DVD title vs. $65 for VHS. HE has DVD revenue- sharing pact with MGM and Wattles said earlier this fall that chain would have agreements with most studios by year-end 2002. Company raised target for 4th quarter same-store sales to 6-7% from previous 4-5% and pro forma net income to 26-28? from 24- 26?. It opened one store and closed 7 in quarter to end with 1,809. Hollywood has no plans to add new stores in 2002, largely because it’s required to reduce debt below $100 million from $445.8 million at quarter’s end. It also is working to reduce annual sales gap between stores one to 3 years old and its older outlets. While HE’s average annual per store sales are $750,000, those less than 3 years old (716) are at $633,000, Wattles said. Newer stores were “underserved” by previous HE management in “last couple of years,” said Wattles, who co-founded chain, but left it in late 1990s and returned as CEO last Aug. HE has no immediate plans to join rival Blockbuster in offering services outside rental/sales business such as pay-per-view movies but Wattles said it was capable of providing other services without “cannibalizing” its existing business, although such plans were “2003 issue.”

Prima Games secured exclusive rights to create, publish and distribute official strategy guides for 4 titles from id Software, Sega of America, 3DO. Company said titles were Heroes of Might & Magic IV, Might & Magic IX, Return to Castle Wolfenstein, Virtua Fighter 4.

Digital Mayhem division of Irvine, Cal., game maker Interplay Entertainment said it would ship action game Hunter: The Reckoning for Xbox March 15. Title is being developed by High Voltage Software team in conjunction with White Wolf Publishing.

Ubi Soft Entertainment expressed confidence Wed. about 2nd half of its fiscal year, saying that despite “uncertain economic climate… the videogame industry remains dynamic due to the fast growth of the new machine installed base.” Paris-based game maker said it planned to ship “over 100 new games between now and March 22, 61 of them in the 3rd quarter” (Oct.-Dec.) across all platforms and genres. Company said: “By the end of the current fiscal year, the group will have added another 160 titles to its catalog, 30 of them PlayStation 2 (PS2), 5 for GameCube (with 2 titles at the console’s launch in the U.S.A., Disney’s Tarzan Untamed and Batman: Vengeance), 3 for Xbox and 30 for Game Boy Advance” (GBA). In addition to 2 U.S. GameCube titles, Ubi Soft said other games showing “particular promise” included Rayman Arena and Tom Clancy’s Ghost Recon. Company made comments as it announced 2nd quarter consolidated sales increased 24% to 53.1 million euros ($47.8 million) from 42.9 million euros ($38.6 million) in same quarter year ago, while first-half sales improved 72% to 113.4 million euros ($102.2 million) from 65.9 million euros ($59.4 million). Game maker said it published 46 new titles in first half of its year -- 6 more than same period year ago. While PC games represented 50% of first-half sales, GBA generated 21% of revenue. Best-selling titles included Myst III: Exile, of which “more than 750,000 copies were sold worldwide,” Ubi Soft said. On geographical basis, N. America contribution to company’s sales doubled from first half year ago, accounting for 40% of sales as result of what company said was “success of [its] acquisitions and of the distribution strategy for this geographical area.” Ubi Soft added: “The good performance in the first half of the year, which normally does not exceed 30% of Ubi Soft’s business for the year, combined with the quality of the future portfolio of games, allows the group to confirm its targets for the 2001/2002 fiscal year: 35-40% increase in sales [and] net margin of between 4 and 5%.” Company plans to report first-half earnings Dec. 14.