According to rumors that have been kicking around a month or so, Chicago-based Raw Thrills has been hard at work on an arcade version of Guitar Hero. Eugene Jarvis' Raw Thrills is one of the remaining handful of arcade game producers here in the States, and the company is responsible for games like Target Terror, Big Buck Safari, and The Fast and the Furious: Drift. The company is also believed to be working on an upcoming game based on American Idol.
Considering the company's pedigree and that there really aren't many other domestic developers left to complete such a task, it seems reasonable that they'd be the go-to guys for a Guitar Hero arcade cabinet. However, the rumor gets a bit weirder, with Bemani Style claiming that it has heard from a "very reliable source" that Konami would be the publisher.
The last time we heard from Konami about domestic rhythm games (Rock Revolution notwithstanding) was a lawsuit flung in the direction of Harmonix, MTV, and Viacom over the whole "hey, we made those plastic instruments first" thing. Back in 2007, Gamasutra noticed that the fine print on Activision's Guitar Hero pages references Konami-owned patents, leading people to assume that Konami and Activision must have already reached some sort of agreement.
So... if they're already past the whole "you stole this thing" part of the relationship, why not take things a step further and let Konami, a company still in the business of producing guitar-laden arcade cabinets in Japan, handle Activision's Raw Thrills-developed baby? It's so crazy, it just might work. But we'll have to wait until Tuesday to find out, as that's when the International Association of Amusement Parks and Attractions show--where all this is supposedly going down--starts.