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Do not expect a return to the old release cadence for Take-Two Interactive’s publishing labels like Rockstar Games. While a decade ago, Rockstar used to release one game a year, it has only released Grand Theft Auto V and Red Dead Redemption 2 since 2013. And Take-Two Interactive Entertainment chief executive officer Strauss Zelnick told a group of investors in a conference call today that is unlikely to change.
“The development cycles for our core, immersive releases are still significant,” said Zelnick. “It takes some time to make what we hope will be the best titles in the business. Development cycles are not getting shorter for core, immersive releases. I wouldn’t necessarily expect them to.”
Where games might’ve averaged a few years of development in the past, that duration is expanding to half a decade or more. But Rockstar points out that this goes hand-in-hand with its microtransaction strategy.
“What has changed is between big releases we continue to engage consumers with add-on content and opportunities to engage in online versions of the game and instances of online multiplayer,” said Zelnick. “That’s what created recurrent consumer spending. But much more importantly, recurrent spending reflects consumer spending and engagement.”
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To translate Zelnick, developers are generating revenue from the same aging games with in-game purchases. And the CEO believes this is partially driven by the desires of consumers to play the same games for longer.
Bigger games means more consolidation
Zelnick went on to note that bigger and more complicated games means they’re also riskier to produce. And that will have a knock-on effect that makes the market more difficult for smaller studios.
“Over time, will it be harder for smaller companies to compete in this space? I think the answer will be yes with regard to both mobile and console,” said Zelnick. “The resources required are significant. The risk profile is significant. And the history of the entertainment business is that over time, those that are very creative become very successful. Those that are very successful become bigger. And those that are bigger have the opportunity to acquire smaller enterprises.”
So Take-Two’s boss expects more acquisitions and consolidation. And that may also help the publisher fill out its release roster as its current teams take longer than ever to produce new games.
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