Take-Two Interactive CEO Expresses Doubt About Potential Of Cloud Gaming

Strauss Zelnick casts some doubt on cloud gaming revolutionizing the industry.

Posted By | On 16th, Sep. 2020

take-two interactive

As is usual, technology progresses alongside time. One of the big shifts for all forms of entertainment has been going from physical media to digital. While physical is still mass produced, it’s undeniable that digital has started to eat away at the market in most major regions. In gaming’s case, roughly half of game sales are digital now, and both Sony and Microsoft have digital-only next generation console variations coming this holiday season. This naturally has lead to streaming being a big talking point for some, especially Microsoft who recently launched their Xbox Cloud Gaming initiative married to their Game Pass subscription. But not everyone is convinced it is the future.

In a lengthy interview with Protocol, the CEO of Take-Two Interactive  Strauss Zelnick talked about cloud gaming. He seems to be still be very skeptical of it being a key feature of the industry’s future. Zelnick points to similar hype behind VR, a technology that has progressed but largely stayed niche, and sees a similar trajectory for cloud gaming. He sites several reasons for this, including casting doubt on the idea that there’s some massive untapped potential customer base who want to play games and are only waiting for them to pop up on their phones or PCs (an idea that Microsoft’s Phil Spencer has alluded to in the past).

“There were some parties who were saying there are 130 [million] to 140 million current-gen consoles out there. There are billions of PCs out there. You know, if you can make in a frictionless way, console video games available to everyone who has a PC or a tablet or a phone, then your market size automatically would be 20x, just mathematically. Of course that doesn’t make any sense at all. Because the implication is you are super interested in video games but you were just unwilling to buy a console.

“[The consumer is] beholden to whatever technology exists wherever they live. You may be out on the cloud, but if they’re on a phone line, they won’t be able to avail themselves of what you’re distributing.

“We’ve sold 135 million units of Grand Theft Auto 5, 32 million units of Red Dead Redemption. I wish I could tell you that there will come a point where various cloud gaming services will mean those numbers are doubled or tripled, but I don’t really see it.”

There are other hurdles that Zelnick doesn’t get into here either, such as the quality and infrastructure of internet worldwide. Of course, it’s always difficult to gauge exactly how a medium will progress, and clearly there are companies looking to push streaming, with the biggest being Google with their Stadia platform. Only the future will tell, but you can’t deny that Zelnick puts forward a good case for skepticism of our potential cloud gaming future.


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