Take-Two CEO: Industry consolidation is inevitable

 With ever-rising costs of production of a good-quality title, Take-Two Interactive CEO Ben Feder says that it’s no wonder Activision and Vivendi merged. The industry stalwart even went as far as to say that consolidation in the industry is inevitable. Will this be the start of a new age in the gaming business?

Reacting to the astounding move by Vivendi to merge with giant game publisher Activision, Take-Two Interactive CEO Ben Feder said that such moves are inevitable in the industry judging by how things are going.

“Video-game development is not getting any cheaper,” explains Feder. “It’s a capital-intensive business, and I don’t see that going away. That will drive some of the smaller competitors out..”

With the introduction of high-definition graphics, online functionality and other next-generation features in today’s games, costs of production have shot up exponentially. Budgets for the production of a good-quality title are thought to hit some US$ 30 million or more in some cases.

Merging should make smaller video game outfits more stable and competitive in the US$ 40 billion industry. Pundits say that the unification of Activision and Vivendi may herald a new age in the gaming business.

Via Reuters