Take-Two wins with Irrational Games closure

Wednesday, 19 February 2014 10:15 GMT By Matt Martin

The Bioshock publisher axes an unprofitable business but keeps the cherry-picked talent and the valuable brands – one of which is Ken Levine himself.

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When Ken Levine announced he was closing Irrational Games last night it came as a shock to everyone watching the games business. A creative like Levine is much-loved by fans and peers, and he and his team have produced an enviable collection of games over its seventeen years. Pulling the plug after the release of the critically divisive but 4 million plus-selling Bioshock Infinite seemed the last thing that he and his publishing partners at Take-Two would, or should, do.

“If Levine really had the influence at Take-Two that his actions are suggesting, he could have also had the pull to reorganise Irrational Games into a coherent and slimline development team that would exist following his departure.”

According to his statement, Levine is starting a new business with 15 members of the Irrational team, while the rest of the studio are let go. They will be well looked after in their bid to find new work; there are opportunities within 2K Games and other studios in the area – most of which are most likely scouring LinkedIn and hanging around local bars to grab the exceedingly talented staff in Boston right now.

But still, their boss just sacked them and started a new company with his old business partners.

The triple-A games business is increasingly tough and the period between current and new consoles leaves studios previously at the top of their game crushed in the transition. But this particular case doesn’t seem to be a result of market factors – at least not on the surface. According to Levine, this decision is his own. A move to “refocus my energy on a smaller team with a flatter structure and a more direct relationship with gamers. In many ways, it will be a return to how we started: a small team making games for the core gaming audience.”

The reality is that Irrational Games – which is wholly owned by Take-Two – isn’t closing down as Levine steps in to save 15 jobs. He’s not walking away to start afresh like Peter Molyneux did with Lionhead, or Greg Zeschuk and Ray Muzyka did when they left Bioware. Those moves were about going it alone but leaving a legacy business to continue creating games. They have become studios that exist and produce in their own right, they can function perfectly well after the departure of their founders. There’s no real mention of it, but Levine is implying that Irrational Games will not survive without him, so selfishly or selflessly, the studio must close.

If Levine really had the influence at Take-Two that his actions are suggesting – to be able to downsize the team and close the doors – he could have also had the pull to reorganise Irrational Games into a coherent and slimline development team that would exist following his departure. But no, Irrational was due to close regardless of its founder. Through some smart negotiation, Levine now gets his dream team and starts afresh.

He doesn’t even need to raise start-up funds because he’s being bankrolled by his old publisher.

It’s Take-Two that is the real winner here. The publisher gets to keep the Bioshock franchise, a brand that has generated $500 million in retail sales. There are questions about its viability in the triple-A market now, but it’s still a valuable name to hold on to. We can expect a reboot within the next couple of years.

“Take-Two gets to keep Ken Levine and his cherry-picked band of talent, and at the same time jettison the costly team at Irrational Games.”

Take-Two also gets to keep Ken Levine and his cherry-picked band of talent, and at the same time jettison the costly team at Irrational Games. Studios are expensive to run, especially those that take years to make a single-player first-person shooter. In the ruthless publishing business, closing unprofitable studios makes headlines, but more importantly raises stock prices.

Perhaps most importantly Take-Two also gets whatever it is Ken Levine and his team will work on next. For the publisher it’s too expensive to have a big studio like Irrational poncing around with new ideas and being creative when they could be churning out a sellable product and improving 2K Games’ bottom line. Much better for the business to axe what it sees as chaff and keep a smaller experimental team behind.

Take-Two gets to keeps Ken Levine and Bioshock, both of which are much more valuable brands than Irrational Games ever was.

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