As the Coronavirus pandemic restricted people to their homes, the worldwide gaming industry boomed last year on higher demand for indoor means of entertainment. Consequently, companies that are active in this space came under the spotlight leading to higher antitrust activity.
On top of that, Microsoft recently announced that its Windows 11 is set to be launched in the back half of 2021. The latest version of the flagship operating system will come with a store-within-a-store capability likely to be big for gaming companies.
Strauss Zelnick’s comments on CNBC’s “TechCheck”:
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Commenting on the healthiest possible outcome of the app store scrutiny, Take-Two Interactive Software Inc (NASDAQ: TTWO) CEO Strauss Zelnick said on CNBC’s “TechCheck”.
“The healthiest outcome is also the most likely outcome, which is that the cost of distribution for us will decline, creating more margin, because there’s more competition.”
Zelnick acknowledged Apple’s strength in paid gaming despite Android being a bigger platform but highlighted that it was unlikely for one company to “aggregate or control an audience on an ongoing basis”.
“The desire for interactive entertainment continues to boom. It’s the fastest-growing category in audio-visual entertainment. I don’t expect that to change anytime soon,” he added.
Take-Two’s partnership with Tencent in China
Best known for its world-famous franchise Grand Theft Auto (GTA), Take-Two recently partnered with Tencent that is currently facing headwinds amidst China’s crackdown on tech giants. According to Zelnick, however, the development doesn’t make him nervous about collaborating with Chinese gaming companies in the future. Partnership with Tencent, he added, has been fruitful.
The CEO also commented on the role of government in protecting the private industry from security breaches and ransomware attacks during his interview on CNBC. He said:
“The U.S. government is beginning to understand that private companies being held for ransom is becoming a public problem. When utilities can be attacked, when power grids can go down, this is no longer a small matter. The U.S. government is trying to do more, it needs to do much more. We all have to be very vigilant. We don’t take our security for granted.”
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