Take-Two CEO is 'highly skeptical' that subscriptions like Xbox Game Pass are the future

Take-Two CEO Strauss Zelnick hasn't changed his opinion on game subscription services like Xbox Game Pass and EA Play. Speaking during today's Take-Two financial update, he reiterated comments he made in September, saying that he's "highly skeptical that subscriptions will be the only way or primary way that interactive entertainment is distributed" in the future. 

"That's because of the way people consume it, and the price point for owning a title, which is very reasonable and very low, actually, on a per-hour basis," said Zelnick. "So I think it's unlikely that subscriptions supplant frontline videogame sales as the primary business model."

Later in the call, Zelnick restated the idea that the price of standalone games is already low. At least, he thinks that's true of Take-Two games. "We deliver the highest quality experiences in the business, and we charge much less for them than we believe they are worth to consumers," said Zelnick.

The past few years have seen a big increase in game subscription offerings. Xbox Game Pass for PC offers a great library for $10 a month, and EA and Ubisoft both offer subscriptions, too. If you buy a lot of games each year (especially if you're a fan of series with yearly or near-yearly new releases), these services can save you money. Of course, there are downsides. Games can be removed from the libraries, and you could end up paying more over time if you only play a few games in a subscription's collection, or if one day you have to subscribe to a bunch of services to get access to all the games you want (think Netflix, Hulu, Amazon Prime, Apple TV, HBO Max, etc). The prospect of subscription exclusives is a little scary, too, as are the questions of how indie developers might be compensated in a subscription-based future (Spotify isn't exactly popular with musicians).

The rise (or impending failure, perhaps) of cloud streaming presents additional opportunities and issues. If the prospect of buying subscriptions instead of games wasn't enough, Amazon and Google hope they can replace our hardware, too.

I genuinely don't know what the future holds. Subscriptions could take over the way they did the movie rental business, but like Zelnick, I could see them remaining secondary to regular purchases—games are not movies, after all.

Zelnick doesn't have a crystal ball, either, and if he's wrong about subscriptions, he's confident Take-Two will adapt. 

"At the end of the day, the consumer will decide," said Zelnick, "and we will be where the consumer is."