Take-Two CEO: Red Dead Redemption 2 has sold 23m copies

Last night we talked to Take-Two CEO Strauss Zelnick about the companies Q3 results from the end of 2018. And that of course can only start with one thing. Red Dead Redemption 2. With Take-Two revealing that RDR 2 "has sold 23m copies".

Any Rockstar Games release is an extraordinary event and such events are hard to predict one. But this one looks to have surpassed your expectations?

Yes absolutely. I mean we did have high hopes, but it’s always hard to know how things will go. To dwell on it for a minute: a 97 Metacritic score, which ties it with Grand Theft Auto 5. The initial weekend which set a record for the highest opening weekend of any entertainment property, of any sort, of all time at $725m. And the fact that the title is sold more in the first eight days than Red Dead Redemption sold in the first eight years. You know the outlook is very strong.

And do you have any indications of what the engagement is like for the online mode yet?

It’s looking very good although it is indeed early. Just to give you a sense in December Rockstar had monthly active users across Grand Theft Auto and Red Dead Redemption 2 than ever before, setting a new record. Obviously that’s great news. It is however very early.

Talking about long term engagement. NBA 2K19 has seen a 50 per cent rise in multiplayer game played year on year?

NBA 2K19 continues to boom. And we attribute it to the fact that Visual Concepts and 2K continue to push creatively and continue to break new ground. It looks like that title will once again set a record for units sold. It will set a record for net bookings. According to the NPD group it was the No.1 sports title in the U.S. for 2018 and the No.3 title overall, and recurrent consumer spending was up 13 per cent in the quarter year-over-year. So all good news

And that then pushed your recurrent bookings up 31 percent on a flat forecast?

I think we honestly just continue to outperform expectations. And the bottom line is that it reflects engagement. It was driven by the strong sales of Red Dead Redemption, Special Edition and Ultimate Edition, which had additional content which is allocated to recurrent consumer spending. As well as NBA 2K19, the offerings from Social Point, NBA 2K online in China etc.

Is there a possibility of cross promotion for the cross promotion between GTA V and Red Dead Redemption 2?

Rockstar always talks about those sorts of things and we tend not to discuss at the corporate level. I will say that these titles are quite different titles. They’re both performing really well in the marketplace and if there’s an opportunity for cross promotion that makes sense to Rockstar they may do it, they’ve certainly done it in the past, but I’ll let them talk about it.

You’ve invested in a lot of development talent recently. Both signing projects through Private Division and with the new 2K developer led by Michael Condrey. Why is now the right time for that?

We’re in growth mode. We’ve been in growth for a long time. We’re pretty methodical folks. We don’t have a huge release schedule. We focus on a limited number of the highest quality releases every year. And we think that’s where the market has been going and it’s been our strategy since we showed up here 11 years ago. It continues to be our strategy.

When we have an opportunity to convince an extraordinarily talented person to join us, we typically jump at that option, it doesn’t happen often. And as a result we believe we have the most talented creative team in the business; we retain that team and we’re really proud of that.

I think the way we do it is we genuinely ask those folks to to pursue their passions and we give them an extraordinary opportunity to pursue those passions without limitations, without restrictions. They get to be artists. And that’s why we get such great results. Not only do we not tell people what to do creatively, we encourage them to pursue what they’re excited by, we encourage them to push the envelope.

So that’s quite a long term investment plan in Michael and his creative vision, you won’t be expecting to see anything back from that for a number of years presumably?

I think that’s right. I mean we’re making triple-A titles, they take a while.

Private Division is also coming along nicely, with two titles set for this year, just 12 months after the division launched?

Yeah we’re really excited about the Outer Worlds, we’re really excited about Ancestors. We have some great titles coming up, and we also have Kerbal Space Program, we have new content coming for that. Michael and the team have done a terrific job so far.

(Read our full interview with the Private Division team in this month’s MCV)

I wanted to ask you about is about the Obsidian acquisition by Microsoft. Not so much specifically but do you think that the markets is getting more competitive for signing the best talent?

I think that may be one conclusion you would arrive at. I think talent has always been incredibly highly valued in the business and we certainly have always valued the creative folks who work with us incredibly highly. And I think over time the companies that succeed are those who do, and the companies that fail in entertainment are those who would look at talent as fungible. We do not.

Epic Game Store. You’re one of the biggest Steam partners. Do you think Epic Game Store is a positive move for the industry, to bring more competition into that digital PC space?

I think more opportunities for the consumer to buy our products will always be a good thing. We support everyone as long as they’re operated effectively and the business model make sense. So my expectation is we support all comers that has certainly been our strategy so far.

And from what you’ve seen so far do you think Epic Games do you think it’s a potential partner in the future?

It’s very early days. We have a lot of respect for Epic as a company , we have friends there. As I said, our strategy is to be where the consumer is and as long the business model makes sense and the company is operated well we tend to want to be where the consumer is shopping.

With so much going on at Take-Two, are you are you going to have an E3 presence this year?

We definitely will have an E3 presence this year. We’re excited about it.

Are there plans for a public booth?

Stay tuned.

Finally, could you tell us what you think are the biggest trends that Take-Two can capitalise on over the next two to three years?

Well I mean the biggest trend is just that it’s a growth business, the fastest growing business in the entertainment business. Our cohort, the average age is still around 35 and people continue to enjoy the entertainment for the rest of their lives that they fell in love with when they were 17. So as the cohort ages they’ll keep playing interactive entertainment.

I think another trend is that now there are forms of interactive entertainment that appeal to all demographics. Historically, interactive entertainment was thought of as a male focused business. At this point the business is about 45 percent female. And I think that could continue to grow really to be sort of a 50-50 split as the cohort grows.

We also are very optimistic about Asia, particularly China, we think that’s a growth market as well. There’s been some encouraging news coming from China. And we do think esports is a pretty terrific opportunity.

So broadly speaking we see sector growth, more specifically there are pockets of really exciting growth but all of it is reliant on execution. We’ve got to do a great job. We’re going to make great properties and a rising tide will not necessarily lift all ships.