In the past two days, two of the largest companies in the industry have touted the number of games being prepared. Embrace Group (formerly THQ Nordic) and Take-Two Interactive the two have revealed how many games they have in the pipeline.
This is an interesting change in strategy, given the volume these companies are talking about. And it’s also a way to make things a little rosy in the midst of the scary moments we are going through. These two companies do not have very big games to come. But speaking of the number of games in the pipeline, companies can help investors feel more confident.
Many of these games could be canceled and never see the light of day. But the good thing is that we can look at these figures and also see some models.
This count of securities is not informative in certain respects. In some cases, companies will spend a huge amount of time, money, and resources on a single game. The fact that Take-Two works on many basic experiences is helpful, but that doesn’t say how many Grand Theft Auto V games are. or Red Dead Redemption 2 (the highest quality titles) are in progress. Yet the comparisons can be instructive.
In 2008, Electronic Arts released 60 games. In 2017, as the strategy evolved into fewer and larger titles, EA only released eight games per year. And the magic of this transition: the games of 2017 generated much more revenue than the 60 games published in 2008. This year, EA only announced five games for its fiscal year ending March 31, 2021. But it operates 13 consoles and PC games and 15 mobile games, as these “live services” games continue and players continue to buy things from them.
In short, it’s a story of the change that free business models and the enormous challenges of triple-A games have brought to the industry. Many of the larger video game companies have adopted this type of strategy.
And so it’s strange to see a little of this inversion with Embracer Group and Take-Two Interactive who talk about launching so many games. So I took a moment to think about it.
Of course, most people who follow Take-Two want to know just one thing: when does Grand Theft Auto VI arrive? Take-Two Rockstar games haven’t said anything about it since the end of 2013. Rockstar launched Red Dead Redemption 2 in 2018, so impatient fans and investors just want to know when the big one is next.
Take-Two president Karl Slatoff said his company plans to release 93 titles in the next five years. These are spread across internal labels and external development studio partners, which means both big and small games. 67 of these titles will be paid games, while 26 would be free games.
Jeff Cohen, analyst at financial services firm Stephens, said in an email to GamesBeat: “Take-Two did it because people were looking for more visibility on the pipeline in the longer term (aka when Grand Theft Auto VI will happen). Since they don’t want to say, or maybe they don’t really know, they chose this route. “
Slatoff said 63 titles would be core experiences, including 15 extensions to existing title platforms. 17 would be intermediate titles (of a hardcore nature, with short session times), and 13 would be considered as occasional games. I guess intermediate and casual games would be mobile games.
47 of these games will come from existing franchises and 46 would be new intellectual properties. 72 are planned for a combination of consoles, PC and streaming platforms. Seven would also be available on mobile, and 21 would be specifically for mobile.
Take-Two has approximately 17 game studios with approximately 3,400 game developers, not including external game manufacturers. So you can look at this and conclude that it has about 36 employees per team. Of course, that would be really misleading, as some titles like Red Dead Redemption 2 (released in 2018) had 2,000 developers. But some have only a handful, because they can be part of a mobile team or an independent title published by Take-Two’s new Private Division label for games created externally.
If there was a headline to cover this year, Take-Two would likely reveal it.
“I think management wanted to bring some transparency to a more robust pipeline given the list of light releases this year,” said Colin Sebastian, analyst at RW Baird, in an email to GamesBeat.
Embrace Group, formerly THQ Nordic, announced Wednesday night that it has 118 games under development, including 69 unannounced titles. It is a measure of the size of the game management company based in Stockholm, Sweden. It is now one of the largest game publishers in Europe.
The Embracer group has five large subsidiaries, with a total of 31 game studios and more than 3,500 employees and entrepreneurs. Major groups include Amplifier Game Invest, Coffee Stain Holding, Koch Media, THQ Nordic and Saber Interactive, recently acquired.
When you think about how unusual this activity is, the company has an average of 29 people working on each game, and each studio has an average of 112 employees. These are small teams according to the standards of American triple-A companies, but they are large teams for independent games. And that’s what Embracer Group has in its portfolio: a mix of big games and small games.
In the coming fiscal year, Embracer Group said it would have no triple-A headlines, at least nothing comparable to last year’s Metro Exodus. But don’t worry, many games are in the works.