Rockstar ownerTake-Two Interactivedoesn’t see its video game portfolio as a good match for subscription services such as Xbox Game Pass, at least as far as day-one releases are concerned. During a Tuesday earnings call,Take-Two InteractiveCEO Strauss Zelnick revealed that the company is still monitoring the sprawling game subscription business but isn’t planning on supporting it with anything beyond rereleases of classic titles for the time being. From the conglomerate’s perspective, day-one launches simply don’t “make sense,” Zelnick said.
The likes of Nintendo, Sega, and Atari experimented with game subscription services since the ’80s, but modern takes on the idea only started gaining traction after Netflix popularized the concept of paying for on-demand catalog entertainment over the course of the previous decade.Looking at every gaming subscription out there, Microsoft is currently the arguable leader in the segment with its Xbox Game Pass offering, both in terms of content volume and variety. That said, Sony, Ubisoft, Apple, and half a dozen other companies are currently competing in the niche.
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Zelnick acknowledged Microsoft’s dominant market position during yesterday’s earnings call, but said that the Game Pass business model is a much better match for “linear entertainment,” i.e., hand-crafted games with predictable playthrough times. The executive reiterated the distinction between those products and the niche in which Take-Two is competing, which he categorized under a broader label of “interactive entertainment.” In conclusion, the CEO said that Take-Two’s studios will continue to focus on designing long-term experiences instead of “catalog titles” suitable for subscription-based distribution.
Seeing howGrand Theft Auto 5isthe most profitable entertainment product of all time, Zelnick’s comments are far from surprising. Take-Two spent the better part of its 30-year history as a Fortune 500 company, and it got there by consistently putting out hits that broke sales records while they were still retailing at full prices.
Looking at the bigger picture, another thing standing in the way of same-day releases on subscription platforms is the fact that right now, onlyXbox Game Pass is pursuing day-one gamesas a growth strategy. In contrast, publisher-run services like EA Play and Ubisoft Plus are more interested in exclusives, while solutions such as PlayStation Now and Nintendo Switch Online’s classic catalog aren’t marketed as Netflix-like gaming services in the first place. Regardless, Zelnick’s remarks strongly imply that Take-Two also isn’t interested in running its own subscription service for the time being.
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