Take-Two’s Private Division welcomes competition from Epic Games

Gaming has seen something of a continental drift for years. The biggest games are ballooning into more massive projects. And on the other end, a deluge of indie creators are flooding digital stores with smaller releases. And in the middle? Almost nothing. But publishing company Take-Two Interactive Entertainment has spent the last few years attempting to address that with its Private Division label. During a fireside chat as part of the GamesBeat Summit 2020, Take-Two corporate development and indie-publishing boss Michael Worosz said that was always the goal.

“When we first wrote the business strategy for Private Division in 2013 and 2014, the landscaped looked — from far away — like two very different bookends,” said Worosz. “You have triple-A and quad-A along the lines of the content that Rockstar is known for. And then a red ocean of small indie games with small budgets. And there wasn’t anything in the middle.”

So Take-Two set out to find opportunities in this part of the market with Private Division. And this matched up well with a growth in the number of developers with a lot of skill and experience starting their own companies.. One example of that is the sci-fi shooter Disintegration from developer V1 Interactive.

V1 cofounder Marcus Lehto had 20 years at Destiny studio Bungie. And his team is capable of producing something that looks bigger and more expensive than most other indies. That’s the exact kind of product that could benefit from a partnership with Private Division. The Take-Two label has marketing muscle and existing relationships with media outlets. And that can ensure Disintegration doesn’t get lost in the noise.

Take-Two feels validated by Epic’s publishing plans

But Private Division isn’t alone in this space anymore. Epic recently revealed plans to publish games from the developers of Control, Limbo, and The Last Guardian. This is a more direct approach that follows Epic’s spending to keep games off of Steam for a limited time. Now, instead of finding games that are nearing completion, Epic is funding 100% of the development of new games from its partner studios.

It’s a big plan aimed right at the kinds of bigger-budget independent projects that Private Division was pursuing. And Take-Two acknowledges that.

“Competition validates what we were doing with Private Division,” said Worosz. “It gives developers another publisher to turn to. Although — developers that go with Epic might be constrained into publishing on the Epic Games Store, and I think that might limit the opportunity for studios who want to reach a broader audience on Steam. But they’re a tremendous partner with deep pockets, great tools, and an understanding of the gaming audience.”

Take-Two is determined to invest in new properties

But while Private Division is working to do stir up something from gaming’s forgotten middle-class, it’s also thinking about tomorrow’s blockbusters.

“You always have to be planting the seeds for new intellectual property,” said Worosz. “Our industry really depends on sequels for the bigger economic opportunities. But if you’re over dependent on sequels, I think you can wring the opportunity dry. And you have to plant the seeds to harvest tomorrow.”

Again, this is a long-term play for Take-Two. Almost no brand new gaming property is going to deliver results like a Red Dead Redemption 2 (let alone a Grand Theft Auto sequel). But what’s the next franchise to generate a Red Dead Redemption 2? Take-Two is trying to identify and grow those. And that can fill out and replenish the company’s offerings between releases from Rockstar, 2K, and Private Division.