Take-Two CEO Strauss Zelnick has stated that the company anticipates the video game industry will enter a "commercial streaming mode" within the next three years. This prediction comes amidst a challenging hardware market where soaring costs for consoles and PC components are making gaming less accessible.
Zelnick acknowledged the current computing hardware crisis, which makes acquiring components like GPUs exceptionally difficult and expensive. However, he believes that the increasing inaccessibility of traditional gaming hardware will not be an insurmountable obstacle for Take-Two. The executive pointed to the "advent of streaming" as a key factor that will allow the company to continue growing its customer base. He envisions a future where streaming technology achieves low latency and robust performance for consumers, transforming devices that are not currently considered gaming machines into viable platforms for playing games.
"Machines that weren't game machines before will become game machines," Zelnick remarked during a recent earnings call. This shift, according to Take-Two's perspective, means that the potential user base for games could expand significantly, regardless of the state of the traditional hardware market. Zelnick is confident in this future, stating, "I think we'll be in commercial streaming mode within three years."
He elaborated that this widespread adoption of cloud gaming could potentially increase Take-Two's addressable market tenfold. While this may not directly translate to a tenfold revenue increase, as the most dedicated players typically own traditional gaming hardware, Zelnick sees cloud gaming as a significant opportunity for titles with broad appeal, even those outside of core gaming demographics. The prospect of playing major titles like Grand Theft Auto 6 without the necessity of a dedicated gaming setup could attract a vast new audience, particularly as the cost of building such setups continues to climb.
However, the move towards a streaming-centric future raises significant concerns among consumers regarding game and media ownership. Efforts like the "Stop Killing Games" campaign and public outcry over the cessation of disc production by some companies highlight a justifiable unease about relying solely on streaming and subscription services, which are vulnerable to being discontinued. Even prominent figures like Hideo Kojima have expressed fears about losing free access to beloved media. While Zelnick has previously expressed skepticism about subscriptions becoming the primary distribution method, his current outlook appears to embrace the potential of streaming.
If the current hardware cost crisis persists or worsens, the industry may see a growing acceptance of the prediction made by Ubisoft's director of subscriptions, Philippe Tremblay, who suggested that gamers would eventually become "comfortable with not owning your game."