Microsoft Pays $50 Million for GTA IV Content

A corporate conference call with Take-Two higher-ups and financial analysts has revealed that a $50 million chunk of deferred revenue originated from Microsoft, apparently in payment for exclusive GTA IV content.

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Featured prominently in Grand Theft Auto IV publisher Take-Two's Q2 financial report was the upcoming exclusive content for the Xbox 360 version of the Rockstar-developed game. Now a corporate conference call with Take-Two higher-ups and financial analysts has revealed that a $50 million chunk of deferred revenue originated from Microsoft, apparently in payment for the exclusive content.

In speaking to the cash infusion, Take-Two chief of finance Lainie Goldstein also confirmed the release date of the first of two downloadable expansions. "The first 25 [million] is for the first episodic content package that's supposed to go out, and that is in March of '08," she said, according to SeekingAlpha. "The second 25 will be for the second episode, and that will be later in fiscal '08."

While these particular expansions will be relegated to the Xbox 360, similar content for the PlayStation 3 was hinted at last year. The absence of any mention of PlayStation 3 exclusive content suggests that either Sony has yet to strike a deal with Take-Two, or that the two companies have engineered another type of arrangement altogether.

Following the news of major restructuring by Take-Two, some analysts speculated that the release of GTA IV would be delayed until after the company's first quarter start of October 30th, in order to boost its 2008 fiscal year performance. Take-Two executives quickly responded to the rumors, assuring fans and investors that the game is still scheduled for a simultaneous Xbox 360/PS3 release on October 16th.

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From The Chatty
  • reply
    June 18, 2007 12:59 PM

    That is insane. I can't imagine them possibly getting their money's worth out of this.

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      June 18, 2007 1:02 PM

      Microsoft spends $50 million like you choose whether or not to buy a hashbrown with your egg mcmuffin!

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        June 18, 2007 1:04 PM

        Wouldn't they be better off using that money to get exclusive games for their system or something?

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          June 18, 2007 1:14 PM

          Possibly, but few games are likely to be as powerful as GTA4.

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      June 18, 2007 1:03 PM

      yeah, its insane. but if it keeps people from buying ps3s and ps3 versions of gta4 then its worth it to MS.

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        June 18, 2007 1:05 PM

        Do you think it really will, though? The first episode won't be out until five months after the game is released.

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          June 18, 2007 1:19 PM

          I'd get GTA4 for the PS3 if it had this sort of episodic content, so I'd say yes. Since they can't get the game exclusive to just their system, Microsoft did the next best thing.

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          June 18, 2007 1:26 PM

          Well, I'm no expert, but I'm sure Microsoft is thinking that if they can hit the Playstation hard enough right now then Sony might abandon it altogether.

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            June 18, 2007 1:35 PM

            Of all things Sony would abandon, the PS3 isn't one of them.

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              June 18, 2007 1:46 PM

              What's your basis for saying that? To my knowledge they've lost a lot of money on it. Even PS2 hardware sales weren't profitable (although software deals were).

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                June 18, 2007 2:08 PM

                It's still crazy as hell for Microsoft to shell out $50 million, but I'm just saying.

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      June 18, 2007 1:14 PM

      i have tons of friends that love GTA, and exclusive content will make them buy the 360 version over the PS3 version. MS wins by increasing there console sales.

      Saying that, i doubt these two content packs will be cheap

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        June 18, 2007 1:22 PM

        I would think it would kind of defeat the purpose if you had to pay for them, though I could be wrong.

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          June 18, 2007 1:39 PM

          They charge for everything else. Hell, oblivion charged for new horse armor. This won't be like some new car models for 50 million dollars. MS will totally charge for these packs and GTA fans will pay for it

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      June 18, 2007 2:23 PM

      They haven't paid 50mil for the exclusive, they've given Take-Two a loan of 50mil, under the idea that the downloadable content (which obviously will cost the end user) revenue will pay it back to MS. If the content doesn't make enough revenue then take-two will have to pay the difference back to MS.

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      June 18, 2007 3:35 PM

      It depends on what is meant by the term "episode." If Vice City and San Andreas are "episodes" of GTA3, as stand alone games built on the same technology, then it seems like a very intelligent investment on the part of Microsoft. Together, Vice City and San Andreas have sold more than $300m. If Microsoft has secured sales along those lines for $50m it's obviously worth it.

      If it's more along the lines of a HL2, an expansion of the existing storyline rather than a stand alone game, "episode" the decision is a bit more borderline. However, given the billions Microsoft has invested in the 360, $50m seems like a small investment to encourage people to purchase GTA4 for their system instead of Sony's or to give those who have yet to purchase a 360 or PS3 yet another reason to purchase the 360.

      At the very least, it's a better reinvestment of the Vanguard money. :o

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        June 18, 2007 4:32 PM

        Those would be pretty big "episodes" and I wonder what the downloads would be like... Shivering Isles was pretty big as well so I guess its a wait and see thing.

        Either way, its almost like the franchise has a license to print money as everything thats put out (on a regular console not a portable) sells really really well.

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          June 19, 2007 1:56 AM

          I think there is a strong mental bond and association with the Sony user base and Grand Theft Auto, after all it shifted millions of PS2's for them-millions of PS gamers that MS considers a ripe target. I think Microsoft's strategy here is to sever that mental link at its core, by offering itself up as the definitive platform for GTA. They already have all the people who love Halo; I doubt Halo 3 will expand their user base as much as being labeled as the best GTA platform.

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            June 19, 2007 1:58 AM

            So therefore, I think Sony has to safeguard that community they built up from wandering away by offering their own downloadable GTA content...

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