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Take-Two plans to only release games with 'recurrent consumer spending' hooks

"The business, once upon a time, was a big chunky opportunity to engage for tens of hours, or perhaps a hundred hours," CEO Strauss Zelnick told investors. "That has turned into ongoing engagement."
"It may not always be an online model, it probably won't always be a virtual currency model, but there will be some ability to engage in an ongoing basis with our titles after release across the board. That's a sea change in our business."

- Take-Two chief Strauss Zelnick, speaking to investors on a conference call today.

In a conference call with investors today, Take-Two Interactive chairman and CEO Strauss Zelnick made it clear that, at least for Take-Two, the game industry is now all about "recurrent consumer spending" rather than game sales.

"The business, once upon a time, was a big chunky opportunity to engage for tens of hours, or perhaps a hundred hours," he said. That has turned into ongoing engagement. Day after day, week after week. You fall in love with these titles, and they become part of your daily life."

This perspective is not terribly surprising, given that Take-Two continues to generate tons of revenue from sales of in-game items and virtual currency in games like Grand Theft Auto Online and NBA2K 17. 

However, it still gives other devs in the industry a bit more insight into where Take-Two plans to take its business in the future: "recurrent consumer spending opportunities" (aka microtransactions).

"We've said that we aim to have recurrent consumer spending opportunities for every title that we put out at this company. It may not always be an online model, it probably won't always be a virtual currency model, but there will be some ability to engage in an ongoing basis with our titles after release across the board," Zelnick continued. 

"That's a sea change in our business. Recurrent consumer spending is 42 percent of our net bookings in the quarter. It's been transformative for us."

And Take-Two isn't alone -- just earlier today Ubisoft reported its latest quarterly earnings, and "player recurring investment" revenue was a big chunk of its revenue.

"One of the things we've learned is if we create a robust opportunity, and a robust world, in which people can play delightfully in a bigger and bigger way, that they will keep coming back. They will engage. And there is an opportunity to monetize that engagement," added Zelnick. "There's a lot of room for growth. This is just the beginning."

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