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Analyst expects Houser brothers to receive huge Red Dead royalties

UPDATE: Take-Two clarifies that last year's royalties of $383m shared across all studios

Update: Take-Two has since clarified reports that Rockstar will receive $538 million in royalties with the majority going to the Houser brothers.

That figure is actually for across all of Take-Two's labels. And a company spokesman denied that the Housers will take a majority of the internal Rockstar royalties as speculated by analysts.

Chairman and CEO, Strauss Zelnick then added in a statement: “We have a profit-sharing arrangement with Rockstar Games. Thousands of team members benefit from the profits generated by the games that they create. I am incredibly proud of the entire team at Rockstar Games, and Red Dead Redemption II is a masterpiece.”

Original Story: Sam and Dan Houser are due a massive windfall by the end of the year, thanks to today's release of Red Dead Redemption 2.

Bloomberg reports that analyst Gerrick Johnson from BMO Capital Markets estimates Take-Two's royalties will reach $538 million in 2018 following the Wild West epic's launch, plus the ongoing success of Grand Theft Auto V.

Last year, Take-Two issued $383 million to its labels, including to Rockstar's more than 2,000 employees, according to a company spokesman.

While the firm did not say how much the Housers received, Johnson estimated the two brothers will have received the majority - and expects them to do so again this year.

Bloomberg reports a lawsuit filed by a former employee - likely former GTA lead Leslie Benzies - alleges the Housers and 'a few key insiders' share half the profits Rockstar receives. Benzies is actually suing Rockstar for $150 million after allegedly being forced out of this royalty pool, but suffered a setback in his case earlier this year.

Analysts expect Red Dead Redemption 2 to sell more than 15 million copies worldwide by the end of the year. However, the run-up to launch has been mired by controversy over working conditions behind-the-scenes.

Dan Houser's claims that select staff were working 100-hour weeks kicked off a massive debate about the firm's practices, with numerous former staff saying the amount of overtime expected created a culture of fear. Rockstar disputes these claims, insisting that overtime is not mandatory.

FURTHER UPDATE: We originally reported Take-Two issued $383 million in 'internal royalties' to Rockstar Games. The publisher has contacted GamesIndustry.biz to clarify that this was spread across all its labels, and we have amended the paragraph above. Take-Two declined to comment further.

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James Batchelor

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James Batchelor has been a journalist in the games industry since 2006, joining GamesIndustry in 2016, and also runs Non-Violent Game of the Day (@NVGOTD). He does play violent games, but always on Story/Easy mode.

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