Take Two is having a weak 2017 with Red Dead 2 being delayed and not many titles lined up for release. Last year for Take Two was pretty strong with games like Mafia III, Civilization VI, etc. Take Two is planning on releasing a AAA title every year. In a recent interview with Take-Two CEO Strauss Zelnick, he stated-
“We kind of thought we were there in 2015, We had a really good schedule and we began to feel like we were delivering on the promise when we said: ‘We emphatically don’t believe in annualising titles except for sports titles. We want to build a big enough stable of IP so that each season we have a great group of releases”
It looks really promising that the Take Two is thinking of developing a roster of new IPs so that they have a AAA title lined up every year.
“2K had a really good season this past year, but it was, for the company, still relatively thin. And it didn’t help that Battleborn wasn’t a big success. So part of it is the level of success, part of it is the schedule, and part of it is finding the human resources to actually take the intellectual property that we own and bring them to market. Those are an array of challenges, juxtaposed against the uncertainty of how long it takes to make a AAA title, which means we can find ourselves in fiscal 2018 with a much thinner schedule than we’d like.”
Although fiscal 2018 might not be strong, Take Two is trying to recapture the schedule that they had from 2015 and 2016.
“But it wasn’t intentional, and obviously fiscal 2019 will look much better with the launch of Red Dead 2 and a huge new title from 2K, as well as the 2K Sports titles, We are moving in the direction of that goal, David has outlined his five-year plan that will get us part way there. Obviously we know what Rockstar tends to do. And Rockstar’s activities have been transformed by Grand Theft Auto Online. Our goal is to grow and to continue focusing on a few key areas,” he outlines. “We have NBA and WWE, we have our strategy business with Firaxis, we have a triple-A business. We are going to look at mobile and on Asia. Those six buckets are our key focus areas and growth opportunities.”
With AAA title lined up every year Take Two will also try to enter the Smartphone gaming industry. Recently Nintendo made his debut in smartphone gaming with Mario Run.
He continues: “I don’t think there’s radical changes in the strategy. Ideally, we will have one triple-A title every single year.”
It is really good news for gamers as they will be getting a new AAA title from Take Two, and take doesn’t have a bad track record with games, it has a some good franchise in it like – Mafia, Grand Theft Auto, Bully, Civilization, XCOM and many more.
Mobile is an interesting focus for 2K. Take-Two has been reluctant to invest too heavily in smartphone gaming in the past, with Zelnick repeatedly expressing his scepticism about the market.
“I’m not sceptical about the market, I’m sceptical about one’s ability to participate in the market,” he corrects. “The issue is when we tried to do standalone, made-for-mobile titles, we didn’t do very well. We have done very well with WWE and basketball, and we think there’s more opportunity there. The reason we acquired Social Point is so we would have a native presence on mobile through a company that has a track record of creating a multiplicity of hits.”
He also added- “But to be clear, I just said that the hit ratios are super low, which they are. Many companies have had one hit and no more, and the valuation of these companies were high. These were all truths, not opinions. My opinion is that the market is challenging, but we think we now have a way to participate in that market in a way that makes sense.”
Ismailer adds: “Our focus right now is on our core two brands – NBA and WWE. Once we get those better positioned, I think there might be an opportunity to leverage some of our other brands in the mobile space.”
“We have a number of titles that Michael Worosz’s group is developing with independent developers, which are intended to be AAA products,” Zelnick says. “We are quiet about it because there isn’t much to say. They are in development and we’ll bring those to market as and when. And then within that group is also Social Point. If we are successful with the independent games initiative, and if we are successful with growing Social Point, then that will essentially be a third label of the company.”
Ismailer adds: “And we also did an acquisition of [strategy game] Kerbal Space Program recently.”
Zelnick again: “Yes, that is part of the independent games initiative. It has already sold a couple of million units and it continues to sell. It is beloved, and it has a high Metacritic score, and we expect to bring further iterations of that to market.”
Currently Ismailer is trying to make their mark in Asia. he stated-
“China is definitely very difficult, but I do think there are in-roads that some of our partners are making in terms of putting more Western content into the market,” he says. “And I think that we have amazing IPs, and some of our catalogue business has done extremely well on PC. Our goal is to bring all of those products to market in China.”
Zelnick adds: “The biggest challenge in China is Government approval. The market likes what we have to offer, the issue is being able to offer it. Tencent is launching a platform, and we will see what the approval process is like around that platform.”
Now that Take Two is also dominating the Sports genre in video-games with WWE and NBA, he added-
“That was before we launched the league with NBA,” he says. “We would have no reason to launch a joint venture with them if we didn’t think there was an economic opportunity. The two tournaments that we’ve done already were seen as promotional, testing the waters, and hundreds of thousands of teams played millions of matches, which was great. The launch of the professional competitive gaming league with the NBA is intended to be a meaningful venture, and we will see if it is or not, but it is intended to have sponsorship revenue, advertising revenue, media rights revenue, event revenue through beverage, merchandise, and the like.”
Zelnick also thinks esports has the potential to expand the reach of games to the broader entertainment consumer. He says there are four different types of games customer out there. “You have the hardcore gamer, which is a natural audience for us. Then we have the ‘I really like games but I’m not a core consumer’ group, and in almost all instances we want to get to them. Then we have the ‘I maybe buy one game occasionally when it really speaks to me’. Finally, we have the ‘I just want a pure entertainment experience, and I don’t care if it’s a video game’… that’s Grand Theft Auto.
“We have different titles that speak to each of these concentric circles, and our goal is to widen that as much as possible. Sometimes it won’t happen. Civilization is not going to go out to that fourth circle, but GTA can, Red Dead Redemption can, one could argue that Borderlands gets to the third circle, probably not the fourth.”
“Basketball… maybe over time you’d be unsure whether it is interactive entertainment or not. Certainly the league we’re launching with the NBA could explode these concentric circles to being irrelevant, because anyone can watch what is going on.”
“We have gone from a company that focuses on hardcore gamers, to an entertainment enterprise that is expressed through interactive entertainment primarily, but there may be other areas that has nothing to do with games. I would argue that the league really has nothing to do with interactive entertainment, because it will be linear entertainment for most of the people involved. They’re watching it, they’re not interacting with it. We’re not calling it a different market, but that is what it is.”
This interview gave us an insight of what direction the company will be taking and this direction is right for us as having more games to play is always good news.
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