Zelnick: "In five years packaged goods will still dominate"

Take-Two boss also believes dependence on GTA is gone

Take-Two chairman (and soon to be CEO) Strauss Zelnick has laid out his vision of the publisher's future.

The switch to digital distribution will be gradual, he argued to Reuters, only growing from its current 10 per cent share of revenue to 25-30 per cent "over time."

The biggest opportunities would remain in traditional retail, he felt. "I still think in five years the packaged goods business will dominate. It's kind of irrelevant to us -- basically the same gross margin, basically the same risk."

After a troubled few years, Zelnick was confident about the publisher's performance, suggesting it was no longer dependent on Grand Theft Auto. "We don't have any structural impediment to being profitable in a given year."

Zelnick claimed that Take-Two would avoid giving its franchises annual releases, for fear of quality loss and consumer ennui. He also suggested that its licensing deal with Major League Baseball might be put on hold. "It's a losing proposition and we don't have any interest in pursuing losing propositions."

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Latest comments (9)

Ryan Davies Creative Director, Gospelware11 years ago
Take2 Chairman finally proves game publishers are dinosaurs #wedontneedpublishers
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Alexander Khristian Project Manager, PIPE studio11 years ago
Even Taketwo dinosaur it does not prevent them to make greate games.....
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Ryan Davies Creative Director, Gospelware11 years ago
I think your wrong Alexander Take2 make THE BEST games, and would make many more if they embraced DD, more revenue, more games, more studios more teams.
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Hess Barber Brand / Business Development Director, Globex Studios11 years ago
DD is a great option to have but one of the things about DD Im not so sure about is this.. Its Christmas, or someones birthday, you want to give them a gift, their favorite game has just been released. Everyone else is giving them boxed presents to open, then you hand them a email printout from your bubblejet.. "I got you a DD game".. hmmm.. looks like a printout to me..

Gifting is somewhat lessened by that, no? Maybe other gamers would consider this form of purchase but what about parents shopping for a child or anyone that is not a gamer, they are still going to the local mall to go shopping for the majority of their purchases. If games were only available as DD, then all the shoppers out there would buy other things as there would be no more games stores, and that would hurt the games industry, very badly.

I think that DD is currently most effective as expansions, additional content, patches, micro transactions, an alternative choice to boxed goods etc.. And that will continue to grow but as far as replacing original boxed goods, for the time being, I agree with Zelnick on this. I think it will take a change of generations before people start saying, "whats this? a box wrapped in colored paper?! Ive never seen this before? where's my email printout?"
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Ryan Davies Creative Director, Gospelware11 years ago
Who has a printer these days lol?

You have to look around everyone who's naysaying about DD are either publishers, distributors, marketing.You know, all the guys who control how when where and for how much software is released. If anything getting rid of this old school pipeline will make the end result in revenue for the developer more sweeter resulting in a better market, with more opportunities.

gaming gift cards anyone? I really don't want my Nan buying me horse training deluxe for the wii or something just as crappy when I can get her to gift me some coin to spend on onlive xbox etc.

Digital is more economical, better for our wallets as gamers and better for our bottom line as developers.

I have never bought a CD since 2000 and can't wait to get rid of those game boxes I feeling like I'm at a party in 1999 every time I have to open a CD tray. I have ONE friend who buys CD's but he has OCD.

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Hess Barber Brand / Business Development Director, Globex Studios11 years ago
Haha.. Fair enough, I hear you, but I do know there are plenty of people out there that love to have something in their hands when they make a purchase and they are not in marketing, distribution or publishers, they are just consumers, your average gamer. I just don't see that going away anytime soon regardless of the benefits.

With the next generation of future consoles it will be interesting to see who will take the leap of faith and release a DD only machine with no cd (blue ray) drive at all. If they all do this then maybe DD will become the norm, but I cant see Sony dropping its Blue ray format that it fought so hard to establish, that is only just now becoming the standard to the average consumer.

Regardless whether you are ahead of the technology curve, the reality is most of the general public are not. We are slaves to our own progression. Weren't we supposed to have flying cars by now! I was so looking forward to that =(

Definitely an interesting topic though and one to watch over the next few years.
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Rick Cody PBnGames-Board Member 11 years ago
My friends say they like owning the discs or something physical as a proof of purchase. But the same people have no problem buying Portal, Castle Crashers, or Scott Pilgrim on XBLA
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Andrew Goodchild Studying development, Train2Game11 years ago
@Ryan. It is not generally more revenue at the moment. It is more money to the publisher per copy sold, but in terms of a big release, generally less copies sold.
Whilst long term this may change, in the short term we will probably just see a few more exceptions.
You just have to look at the fact take two have to release the GTA and RDR DLC in packaged SKUs to access a large part of the console audience who still don't download anything.
I'm not saying the balence won't shift, my bet is it will, but not necissarilly in the next 5 years.
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Eliot Lloyd Studying Computer Games Design and Production, Northumbria University11 years ago
@ Ryan

Most people have a printer. They're for printing things. You know, making tangible copies of something. The only people who are really trying to push digital downloads are indie gamers. Publishers aren't sticking with physical copies because they want to make more from each game, they're sticking with physical copies because the vast majority of people want physical copies. People who are pro-DD are merely a vocal minority.
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