Take-Two CEO: don’t overestimate the impact of Fortnite on the industry
In the video game industry, one title has made consistent headlines and become something of a phenomenon: Fortnite. This battle royale shooter (in other words, an open digital world where multiple players roam the landscape looking for weapons to annihilate each other) has been a focal point for investors with an interest in gaming: can other games compete with such a massively popular invention, especially given the fact it’s free to play? According to Take-Two CEO Strauss Zelnick, the answer is that they don’t have to.
In the last three months, Take-Two’s share price has appreciated by 27%
Source: Yahoo Finance
Speaking at the Baird 2019 Global Consumer, Technology & Services Conference, Zelnick said: “I'm occasionally asked, 'Is the Fortnite effect affecting the industry?' And the answer is, Fortnite never affected the industry. Fortnite didn't affect us in the least. We had huge hits when Fortnite was in the market, because Fortnite is different from our titles, and our titles are different than Fortnite.”
This is a nuanced and important point that much of the wider discussion misses. And it’s not about gaming exclusively, but rather, entertainment as a whole. Different genres do not compete with one another directly: if a new Bridget Jones romantic comedy is released, it doesn’t impact the market for sci-fi thrillers like another Terminator movie.
Zelnick’s insightful opinion is worth listening to: as head of Take-Two he’s been the main man to oversee some of the biggest games in history (such as Grand Theft Auto V and last year’s smash hit Red Dead Redemption 2).
Zelnick continued: “I think some companies point at Fornite as sort of an excuse for why their titles didn't do well. But our view is, when titles are great, they do well, and when they're not as good, they don't do well. Put out something really great in entertainment, and people will show up for it.”
Dominion holds Take-Two Interactive in its Global Trends Luxury Fund.
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