GTA 6 reveal causes Xbox and PlayStation sales to jump by a third

0:00This week, console sales spike on GTA 6 reveal, and we chat to Nuzu about the future of the video game business.

0:10Hello and welcome to the Game Business Show. This week's edition is once again sponsored by Keywords Studios. Keywords is, of course, the industry's end-to-end partner. So in other words, they help game developers to make their games, to get the games launched, and then make sure they're being looked after beyond that launch. they're all about long-term partnerships and impressive technology they have 13 000 people in 26 countries they are properly global speaking of which they offer services to help your games go global whilst also feeling local they offer localization services qa services localization qa and have experts in the player experience as well keywords help studios protect the meaning of their games the cultural nuance and in context quality across every market that way players get the real experience as you intended not just translation you can find out more on the keyword studios website or in the newsletter that came out with this show speaking of which let's get back to it and let's talk about grand theft auto 6 the timing of the netflix extended look meant we didn't get to do that last week but also yeah we love having some data so it was worth waiting for but before i go into some numbers i managed to capture it as it went out during gamescom but because I was in Cologne I was on a phone in a restaurant so I experienced it I imagined just as Rockstar I imagined I should I did watch the whole thing late that night I obviously thought it looked stunning I'm no critic but I was actually out with one of the industry's most prominent journalists and he involuntarily went wow during the skydiving scene which I think summed it up a little bit now immediately after it went out or at least around when it went out I was on multiple mainstream channels talking about it I was on BBC Breakfast first BC Radio 5, I was on CNBC.

1:50And what I found fascinating is that these media outlets were as interested in the Netflix partnership as they were the game itself, which goes to show Rockstar's ability to create stories around its game. I really think the Netflix partnership worked. And the numbers do back that up. So Netflix revealed that GTA 6 Extended Look attracted 31.1 million views. Now, the way Netflix does views is it takes the total hours divided by the total runtime. time it was the number one english language movie in 87 of the 93 countries well ahead of the new whist film the whisper man and that number is up until sunday just gone now there's been bigger netflix things stranger things is bigger but obviously netflix only had an exclusive on this for six hours it was then on up on youtube after that youtube by comparison is on 17 million now they count views very very differently and obviously the youtube version is all over you know other media channels all the ign's got a version of gta game spot's got a version of the GTA video so it's not a like for like comparison but obviously that's obviously very big in terms of pre-orders it's a little bit early census tower has done some early calculations and says pre-orders are up 572 percent over two days this is compared to the two-day average during the previous 30 days now it's very rough right now New Zoo which also tracks pre-orders they don't have their latest figures yet and they'll be coming on the show in a minute though to talk about gta 6 they'll share the numbers up until end july one of the big questions around gta 6 is whether it will materially impact sales of playstation and xbox c or playstation 5 in particular and xbox series x and s now gta 6 is a console exclusive it's not on pc so it will likely attract the attention of new and lapsed console players however we're also seeing unprecedented pricing of those games consoles due to the rising component costs we talked about it every week on the show pretty much so how well how much of an impact is can gta 6 have to sort of compensate for that so i have managed to get some early data for the uk market um nielsen iq which used to be called gfk used to be called chart track used to go right back in time it was called gallop and they've been tracking console sales in the uk since the 1990s they get the data direct from the retailers so it's real data they tell us that uh after the gta 6 reveal last week so their week and week sales of ps5 jumped 33 percent and meanwhile xbox series x and s sales jumped 34 percent now the numbers are you know some numbers are quite low for games consoles but that's obviously a a decent jump interestingly and this is an aside nintendo switch 2 sales also rise by about a third um gta 6 is not on switch 2 of course but nintendo did announce a price increase on the console it's going up by 50 pounds in the uk and that comes into effect this week so there'll be people getting their console in before the prices go up so that's why that had a good week as well so what can we conclude from those figures um well clearly gta6 is going to have a positive impact on console sales it's not all going to be concentrated around november 19th either people will be picking up the machines you know ahead of release but just how big will the impact be will we see a surge that it will you know that it will positively impact the install base to such an extent that other publishers developers and games will also see a strong uptick will it lift all ships of course it's not all about console sales either there's also people who you know have a ps5 or an xbox and um maybe it's gathering a bit of dust so they don't play it very often this is an opportunity to re-engage those customers but but the data is we're seeing is positive you know these are big upticks these are good numbers um but it's extremely early days my official position if anyone asks me is i'm cautiously optimistic i think it will cause a surge in sales but uh there's a lot of variables involved right that's enough of that or rather it isn't actually because i'm about to welcome someone that's been doing a lot of analysis on gta 6 his name is ronan patrick he's a management consultant and yuzu and yuzu just put out his global games market report in that report it estimates that the global games market will rise 6.1 to 213.9 million dollars this year and a lot of that spending is coming out of china and the us the bulk of the money will of course be mobile it represents 121.1 billion in revenue so nearly 60 percent really between 55 and 60 percent it estimates that console revenue will rise 22 percent to 46.9 million uh dollars that's due to the you know switch to how do we'll have a full year gta 6 coming out and there's the rising prices as well the consoles just cost more so they make more revenue um on an individual basis meanwhile gta 6 is uh is going to take full game spending to 17.5 percent that's the biggest growth area for the year usually does expect player growth to slow to 3.2 percent com that's a compound annual growth rate to 2029 which is down on the 4.4 percent we've seen over the last year so that means a lot more focus on making more money out of customers and not just uh expecting the industry just to grow by the sheer number of new people coming in there are a bunch of stats in this report but i wanted to dive into a few points with ronan um including the impact of gta six where the growth areas are and what competitive areas can learn from it as um the continue you know we've also got this continued rise of franchises and sequels that's a big thing for the news you report so i'll ask about that as well and a few classic game business topics that you would have heard me talk about before so let's go to it here's new zoo's ronan patrick hello ronan welcome to the show pleasure to be here we were supposed to meet up at gamescom but um gamescom got in the way uh how was it for you it was swells tremendously busy i find games come a very funny event uh in that there's very few other places in the world that you'll have a combination of uh elderly men with neckbeards and you know teenage girls dressed out in outfits all in one place so it's certainly an interesting one i go to a lot of the consumer shows and i do get a little bit out of it but games come i don't think anything i think there's an event i get more out of than Gamescom for my type of journalism.

7:48I'm sure if you're a tech journalist, GDC or CS has more, but I always find it brilliant. But I kept it relatively tight. So I came in Tuesday night and left Friday afternoon. And I don't think I had a moment spare. It was, um, I'm still tired now. You could probably hear it in my voice. Yeah. I, I crashed the days after I was getting like 12 hours of sleep at night after it's, it's a really, yeah, it's a drain. It's a draining event, back to back meetings. yeah i didn't have i have kids so i i didn't get that i have that pleasure um do you find anything noteworthy anything stand out for you that you were like always mainly conversations um i mean it's such an interesting event because you get a whirlwind of hearing what's kind of going on in the industry and hearing what people are up to so i heard a bunch of like interesting um you know approaches and you know obviously industry's in an interesting place i'm sure we'll we'll yeah we'll get to talking about that.

8:42So hearing about all the ways in which people were adapting to that was interesting. What I find really fascinating about that is we haven't actually gone live with it by the time we're doing this recording, but I've done a big interview CD Projekt, and they're so the AAA model, right? It is so historic. They don't think too much about cost. I mean, they do worry a bit, but it's not the number one thing they worry about. And it works for them, right? And then I'm talking to an indie, and they're going down the route of, a double A company and down the route of speeding up development, a lot more cost-driven development.

9:13It's just, it is a real fascination to see so many different segments of the market, even doing the same sort of games, have a completely different strategies to deal with the way the industry is reacting. Anyway, yes, I'm sure we will talk about it. I mean, obviously I've noted the sheer number of Chinese companies and Korean companies. Yes. Yes. That were all across the event, which I thought was noteworthy. Although it is more important to remember, I think, that Tokyo Game Show, Chinese companies often go there in quite a big number and they're not expected to this year. I think it's going to be quieter because of political tensions.

9:48And so maybe some of it's a reallocation of budget. Right. But obviously you can see what the market's doing. Well, and I guess that's part of your report, right? So you did this big report that you put out and there's some industries, you know, I think it's 6.1 % the report suggests growth. Yes. But it's not everywhere that's growing 6.1%. No, no, not at all. The reaction to the report, though, seems strong. Anything surprise you about it? Reaction to it? No, I think the reaction was fairly... I think the industry has recalibrated and reaccepted the position where it's in, in that most people that I've seen reacted to it accept that this is positive news, but this is positive news in the context of, you know, a difficult period that the industry has gone forward.

10:37Because, I mean, at the end of the day, as I've seen some people react to, you know, 6 % overall, when you take out inflation, that looks less impressive. And that's part of a bigger story, right? Which is from 2021 to 2024, the industry was completely flat, but consumer prices rose by like 23 % during that period. And those are costs that the games industry and its consumers are paying. And that's a lot of the kicker, which is, so yes, grew 12 % last year, 2025, and then grew, we expect it to grow 6%. But if you put that in real terms, we expect the industry to still be down 13 % on 2021 in real terms.

11:23And I think that's part of the struggle of the industry is that the top line can grow, but the costs side of it is something we are still grappling with. One of the things I think I see Emmanuel mention it was that innovation is key. And every time I speak to analysts, that seems to be the thing. It's basically, look, game makers, do something we can't predict. and maybe that'll change these outlooks and these predictions. And I think that's an interesting thought, you know, an artistic industry, get back to, you know, doing what you do with art. Yeah, it's a tough one because obviously the onus on the, we are ultimately in the entertainment space and we have to surprise and delight.

12:10But on the other hand, there is a question of what consumers often want are sequels, franchises, and existing titles. Yes, of course. I've done a fair bit of work on this. People haven't already always liked me pointing this out, but it's important to point out, which is to say, if you look at the share of revenue that goes to new titles, excluding franchises, sequels, etc. On console, it's around 6 % to 7%, and then on PC, it's around 10 % to 17%. So a bit higher. But then within that, you basically have a handful of IPs like Cyberpunk, like Hogwarts Legacy, like Ark Raiders, often, you know, big budgets.

12:56They take that. So I think there's a difficulty in that while that remains true and while other factors remain true, we're often going to see publishers taking a very defensive stance, which is to reinvest around their core IPs and franchises. what i will say to that though is doing a core ip does not mean lack of innovation i agree i think about um what drove the switch was a zelda game right and then tickling and that was but it was the most it was the most it was a complete departure for zelda but obviously they lent on the franchise and it found a much much bigger audience and also i know that we talk about the percentages but i look at you know what some of the games that have done well this year like mecha Chameleon and Crimson Desert and Pragmata and I know that those aren't you know taking up the lion's share of revenue it's not a big they're not big live service games but they've been successful and they're all new IP I was talking to Xbox while I was at Gamescom and I and I put I said I think Fable is an interesting IP because obviously it's an established brand but never really broke above five million units it was never that big a franchise so I think that even though this new game might be in line with what Fable was I think in this modern industry where everything so much wider and there's so many more people playing games of different interests where niche games can be still big um i look at that and think that might be that might be an interesting one but then you've got companies like focus and all the stuff that they're doing sorry i'm going no no no i think i think the points you're making are really good and i i couldn't agree more i think just because there's a focus on sequels and franchises doesn't mean you don't need to innovate um it's it's kind of like the way i describe it is it's kind of an apple model where the uh there's a priority based on capture an existing audience but then try and move them laterally onto different innovative products and new upgrades uh and etc and i mean you you had i think john bellamy on yeah a couple of weeks ago that was a really interesting one to listen to because he pointed out the Dragon Wilds, around 75 % of those who took that game up were existing RuneScape users.

15:03So that's a really good example, right? It's innovation in the sense that Jagex is spreading to console and trying to increase their market share, but it works in large part because they have this base, this existing community that they moved over. And I think the ultimate epitome of innovate within an existing play pattern is is you know the biggest title that's going to launch this year right like gta 6 from from what we've heard there's going to be there's going to be tremendous innovation there's the most obvious one that everyone's talking about with the the fact that they're going to integrate the um ugc component which currently sits outside in terms of 5m into the main online experience but from what i've heard there's also going to be kind of dlc in terms of the single player campaign so um wow we'll we'll see yeah it'll be interesting innovation there too i do wonder if if gta 6 is going to last of its kind i mean don't be wrong it's a rare kind anyway yeah i've heard people around that game refer to it as the last of the blockbusters and um and like you know money's no object 10-year development cycle yeah yeah and i know that you know rockstar probably could do another one but then there's also whether there's an appetite of two one of the recurring conversations i've had is this realization from people in their like 50s if they keep taking eight years to make a game they're only making they've only one or two left before they retire yeah nobody really wants that so i do wonder well let's talk about gta 6 then because that was the big thing that happened last week and you've been you've been putting some numbers out have you got any latest yeah so the latest is unfortunately we're recording this at the end of august and um the newsroom platform takes a little bit of time to to release the later so i don't have august but i can give you the june and july numbers so um uh so for reference this is um new zoo game performance monitor tracks uh digital spend in the u.s and five key european markets and what we see is is that in the final week of june gta 6 in its first week of pre-orders brought in$175 million.

17:08And then in July, it brought in$45 million. So given that 69 % of the player base sits in those markets, we're looking at roughly for June and July around 320 million global. Now, those are just like numbers. So I'll try and put them in perspective, because they are truly, they are truly staggering. They're not like the crazy numbers that were being published um i think like one week after on hex but but uh to put that in reference i looked at like nine big recent launches so i looked at like eafc 26 i looked at battlefield 6 i looked at spider-man 2 and i looked at all nine of those launches and their first week um combined gta 6 is still four times um more than those so staggering and obviously this doesn't include August so it doesn't include the actual proper game reveal of the game.

18:05Yeah exactly exactly so I'm keen to dig into that once we see there's probably going to be another bump. I tell you what I find really fascinating with the amount of friends that I had when I you know from school asking me what's the cheapest way of which cheapest way of being able to play GTA 6. These people haven't bought a console in two generations. Yeah yeah. And they're a little shocked at the pricing but they're still trying to work it out. It's 2x. Yes. Well you don't obviously you don't need to pre-order so i always find this yes i always find this quite hard to sort of conclude much because it's not like they're going to be in short supply it's not like there's going to be a yes going to run out yeah it's not like going to be stock shortages come november 19th um so do you think we can conclude much from it yeah it's it's a really good point you can look at the existing the like pre-order curve that has existed for different categories of titles and But the main thing you conclude, which is what you've basically already stumbled upon, which is that basically the lion's share of purchases come just before.

19:10Because why not? You don't need to purchase it now. What you register in a pre-order is you get a sense of the size of how big the devoted core is. um uh i mean to emphasize that um so far with the pre-orders or in the first week of those pre-orders 89 of the pre-orders that came in were for the 100 edition which is which is really high that will probably come and taper down um uh you probably can expect to drift closer towards 50 50 by launch but i think there are some pre-order bonuses isn't there like a month's access to gta plus and things like that um but yeah you could pre-order the day before yeah exactly exactly the hundred dollar thing's really fascinating i actually was quite surprised at what they're sort of conscious of using certain terms but local locking away for players that they do seem to be taking away things that um was in the game but specific locking away behind that hundred dollar edition which is controversial um i guess gta can get away with it yeah completely inelastic yeah I don't know if other players could do that.

20:18I feel like GTA 6 operates in its own paradigm where it just kind of gets to do what it wants. One of the things I think is interesting, though, is there wasn't a strong tie-in to GTA Online. So there wasn't like a clear, you do this up front and you get all of these benefits in GTA 5 Online. So that's interesting because that's what's sometimes done. I wonder if that is part of a general acknowledgement on their part that one of the big challenges they're going to have is to migrate the users from GTA 5 Online, which there are a staggering number of people playing GTA 5 Online, and they need to migrate them over to GTA 6 Online.

21:02So that could be part of the reason. But it's interesting that that wasn't tied to the premium product or on a higher SKU. yeah well the detail online is the big question mark isn't it that's the thing and that's one of the reasons why i didn't do our chat at gamescom was because it was before the video and i was like i don't know what they're doing with online and we still don't really know we don't um what they're doing with online is it is it going to be part of the same package are they is it going to be a i don't is it separate game do they i and it's and it's and it's such an important question like I really do think that it really is the dark horse of this conversation because we can talk as much as we want about premium sales and they obviously matter.

21:46But, you know, Tate 2's latest earnings report, 22 % of the top line revenue came from premium. 78 % came from recurring. So we're only talking about 22 % of the business here. Obviously, a lot of that is mobile. So that's very glib of me to say. but the scale i think people seriously underestimate the scale of gta online still like 13 years later it's doing half a billion in terms of a run rate um 5m the ugc modded side experience it's like the number eight most played game it's obviously a platform on steam it's like 180k concurrent so the scale of gta 5 online 13 years after is is tremendous and from what i know So the expectations around what GTA 6 Online will do are tremendous.

22:37From what I know from my financial contacts, the markets might be disappointed if it does less than a$2 billion a year run rate. So we will see. But we know nothing about it. So we'll just have to see. I guess from an industry point of view, because the thing is the big topic around this is how what impacts are going to have on the wider business and yes there is an element of hope that rockstar can fix everything um and uh can you sell us some consoles gta online is probably the more harmful component from an industry point of view there's that element of you get gta 6 you might get another game you might if you're buying a console at the same time yeah you might um you know maybe by the time we get into february when the when everyone's shifted their games too people have finished with the game and what we're looking to move on but that online component is the one that will that will be sticky and will keep people from them yeah a new black hole yeah even the premium component goes to to what we were discussing previously about sequels and franchises right like the fact that this has sucked all the air out the room the fact that everyone's shifting it's it's gta 6 is the ultimate uh epitome of this point we were making where revenue is often concentrating into these kind of sequels and franchises and yes you can innovate but often the innovation takes place within that structure of sequelization and franchization so yeah yeah i i it's a weird thing because i was looking at the september lineup for games um a couple of weeks ago which is obviously a lot of the games have moved out of they probably would have been in october before the october games have probably been in november before yeah and um there are some games that crossover i look at control resident and silent hill i look at some of the games there and they do there is crossover obviously there's blood of the dawn walker now the witcher 3 remastered in the same month so that wouldn't been ideal but they're all quite different as well and i look at their primary audiences and i can see that they they're not the same and i and i just think back to the industry that i grew up in and the market was so different back then there weren't these black hole games there wasn't things like tick tock there wasn't things like netflix um but there was there was so many video games um and i i mentioned this a few times on the show in one week in 2008 there were more video games that came out and there was the entire september in terms of the triple a end obviously i'm not talking about in the end where that's very different you're right um it is it is there is a lot more focus on the sequels and even you look at the games that are coming out in february they're all it's tomb raider it's fab yeah Yeah, I think you make a good point, which is we are still seeing kind of a transformation in terms of supply.

25:18I was not at Gamescom, I was speaking, but at Brighton Develop, I was speaking to one of the big platforms of browser games. And they mentioned to me that they are seeing the AI impact and it is coming in like a flood. So they said in the first quarter of 2026, they saw more applications for games than the entirety of 2025. So staggering numbers. And I think that's where you're going to see these play patterns often being tested in terms of browser and in terms of on the big UGC platforms. That's where you're going to get this wave of creators who are basically vibe coding their way. and you'll see the testing of gameplay patterns like it'll be really interesting to see if in browser games we basically see new play patterns that we've never seen before but that's that's the bull that's the bull that's the hopeful case the the more concerning case i think is to observe that um even if we transform supply um that demand remains the constraint that we are all faced against we cannot magically create you know thousands millions billions of new eyeballs that number remains that number is is increasing slowly um and i mean we talk about this in our in our report where in the key markets which drive revenue um player growth is slowing which means that logically the only place where you grow and that's what we're seeing is is is revenue per user and a lot of that revenue per user growth is going to the existing sequels and franchises yeah yes i do think there's still opportunity for the industry and i've said this before uh to be more successful with older demographics and i don't and i mean older demographics that grew up with gaming we wouldn't have considered them older demographics we wouldn't consider them existing demographics at all but that you know i mentioned that my friends in their 40s going oh i'm interested in the playstation they aged out of consoles i still think that's strange you get that as tv you know or aged out of tv aged out of music and i and i think that that's partly how does our medium react to that and mobile has been the thing um but you know this is an audience of people that historically have been happy to buy premium goods um definitely they're not necessarily like oh i want to play it for free they just want to want something that's snackable and easy and i actually think i've always had a theory that the success of nintendo switch is partly driven by this audience of people that uh that like these experiences but don't have as much time but but that's a that's an aside what you were saying a moment ago about the ai thing is that we had unity on last week and in that interview he talked about how you know it from an artistic point of view more people coming to market and creating stuff is is a good thing and he doesn't necessarily think it will lead to more professional games it just sort of it will lead to a lot of people you know expressing themselves perhaps creatively whether it's in roblox whether it's in browser games but not necessarily competing with those more professionally made titles um um from established teams uh and i i it's interesting it's something that matthew ball said on the show again connect to what you said around how roblox some of the successes of roblox i think he talked about stealer brain rot in particular so he's never seen anything like that before and is that something that the the console market and the pc market that you know even the mobile market might be able to learn from that and bring that sort of experiences and into their games well i think it's happening i think it's happening already um i think friend slop is basically roblox coming to steam where the existing play pattern of highly casual low graphical fidelity and an overwhelming emphasis on um doing absurd and funny gimmicky things with your friends is coming and then it's just being captured by steam um so i i definitely think there's something to learn there uh and it is i mean we've we've we've done work on this we've looked into the ultimate question of of do do roblox players kind of age up or do they age out and and spoiler alert the kind of the answer is both but yes but uh but yeah that's that's definitely one of the things you're happening um where as people age up um they're still looking for these kind of social experiences.

29:43But I would caution that because I think I know you were, you didn't mention this as a question, but I think the point you were making was really good before. And I want to reiterate it, which is we often forget about older demographics. Like the truth is there is no one video game industry anymore. If you look at the number of people who play games since 2000, we've gone from basically 19 to 39 year olds overwhelmingly men now we've aged up and down simultaneously and that's one of the reasons why we need all sorts of games so it personally frustrates me tremendously when you see articles on on linked cringe and the like where they're basically saying x is dead long live y so they'll say you know um these high intensity high graphical fidelity premium games are dying because the younger generations want this or vice versa you're like no because we just need to serve both audiences and they have different needs and different wants but yeah crazy i put it down to people older people in the industry and maybe i'm being completely generalized here but when you know in the 90s in the early noughties there were basically two audiences of video games i'm being incredibly general here there were kids and there were geeks right and i was at one point both but they were the audiences you made games for children and you made games for gamers basically but now everybody is a gamer so suddenly the idea of there being one trend you know that this is where the industry is going well the industry is going in every direction that's the that's the reality of it that's what happens when you reach the scale and so i've always pointed out that this year we've had triple a new ip like pragmata and crimson desert breakthrough as well as established sequels breakthrough as well as indie games and friends lot breakthrough and the double a is now apparently a thing that didn't work like nine months ago and that was the thing everybody's doing like it's just the truth is it all can work it's very hard it's so competitive there's loads of things out there but this idea i keep one of the lines i've repeated on this show several times and my audience will tell me off for saying it too many times but it is the fact that the trend today is there is no trend yes i think there's a great quote in a gi interview with fuse games we had them on before and he said like you know um we live in an industry where the industry is so large that even niches can reach how millions and millions of players and i actually hated it when the industry used to do it remember everyone said 3d platforms don't work anymore let's abandon that we'll move on to the next trend and EA were famous for it.

32:03I always used them as the canary in the mind. They would go, right, everyone wants MOBAs and everyone would drop MOBAs and go, yeah, we're not doing that anymore. And then they've moved to the next trend and they would chase it. We can't even chase trends in the industry nowadays anyway. Games take too long to make. By the time your games come out, the trends moved on. So just don't worry about it. Don't think about it. Just do the thing that you want to do based on your own analysis and understanding of your audience um so i agree with you very very much nice you go back to gta a little bit will it save console uh it's it's difficult to say consoles had a rough a rough period we expected basically to uh re-hit its 2021 peak so to speak in 2026 um we expected to drive a very large amount of premium spend uh as i mentioned before it can save console but that doesn't necessarily save the rest of the market in terms of it can be its own its own black hole but i think with console you know one of the big question marks that we've been looking into is this whole components crisis um and and how everything factors into that because um i mean ps5 is now at what it's like 60 in inflation adjusted terms it's at 67 percent more expensive xbox is twice as expensive uh we expect to kind of um uh we expect because of that and call of duty to see an uptick in the install base not as high as it would have been uh otherwise but nothing particularly massive.

33:46So that's not the best news. But there is a silver lining when we talk about this general components crisis point, which is to say perhaps some of the fears are overblown when it comes to software. It's important to remember that the lion's share of time is often spent on older titles. And the closest analogy we have to a hardware shock is during the 2020-2021 GPU shortage. And you didn't see engagement or revenue on PC being taken off course. You basically saw a reallocation of spend into software. So I think there's question marks over the next hardware cycle being delayed and that being extremely likely.

34:40but yeah hard to say so yeah it's a weird thing with the cost of console I always think they always see them as quite premium products and we often see people are willing to spend but it's very high the um my always thing that I've always said about consoles and before I said it before the greatest component crisis I don't think this generation has been a particularly interesting one you know there's been occasional hits but I think it's been a bit boring and uh and in this market where you know everyone no one's short of things to do or play i don't think you can get away with that um but um maybe it's just my own slightly blinkered opinion of it but gta 6 is not going to be boring i think there'll be lots of people interested and excited by that but i and the key is is to keep putting out some interesting stuff i think part of the problem is this generation is covid meant that all the studios went into the new generation slightly behind yes um and then Then you've also got the fact that games are taking longer to make anyway, and they've only really, in the last couple of years, started to work out, hey, is there ways we can speed things up without harming the quality?

35:41I always talk about Naughty Dog as one of my favorite examples of this, is that one of the most iconic console game makers in the world, they haven't made a game this generation. And that's not uncommon. We had Mark, I interviewed Mark Cerny a couple of years ago, and he said, we're approaching the point where game development cycles are longer than console generations. and that's for me that's not right it doesn't make sense it doesn't logically make sense the whole point of these machines is to enable game developers if game developers can't make a game in time then they're not enabling them i actually believe the longer generation made sense regardless of whether or not there is the situation going on now obviously i hope the component price crisis sort of does alleviate in the next you know couple of years um anyway those are my opinions which i have expressed before yeah to to circle back on one of them which i think is is the problem isn't just that it takes so long to make them.

36:30I think the compounding problem is our inability to validate retention before launch on PC console. I think that's the other cause of a lot of the issues. So if you combine that with long lengthy cycles, it can become really problematic because unlike mobile, we can't like slowly acquire users over time. So you're basically, you need very large amounts of marketing spend at launch and all of that ratchets up the risk if retention was never there so the danger with these really long cycles is that you develop for a market that no longer exists and you don't and we need to basically be i've spoken to loads of publishers about this because this is something that they that keeps them up at night is how do we basically validate and make sure that the retention is high throughout because it's really really hard to do so that's just one of the reasons put off some vests you know it's the fact that when investors invest in something you can only tell after a year if it's going well with games you don't know until you launch the thing but i mean well then that's changing because we had on the show last week our gamescom special last week had um patrice desolais and and alex hutchinson and then the raccoon logic team on both of them former assassins creed people were making games but they've gone to train to early access yes i've never done that before that was new for them that increasingly seems to be what game companies are doing, which, I mean, admittedly, you still need a largely finished game.

37:53You can't just put out a prototype. Yes, it's a tough one. We had Ubisoft launch its player council at Gamescom, which is like this big thing where they get groups of players in and they test things and test things and test things. We've seen EA in the last, OK, five years now with Skate and Dead Space, which I'm not entirely sure worked out for them, but they had them in right from the start. So I think we're seeing companies sort of react to that. And we've got professional businesses set up that are, you know, built around how can we give you this these these testings and these this um user i don't know if it tells you everything you need to know but yeah the the challenge is because i've spoken to i was at gamescom speaking to a chief publishing officer who was was mentioning that now you know with studios they basically put the game every four months they put it in front of their target audiences and that's just how rigorously they want to test test it and i think the challenge is is that you put your game in front of a golden cohort and it goes oh my god look our d28 retention is is you know upwards of 28.7 but it's uh it's not the same thing uh having that having that level of retention with your golden cohort this kind of curated set of players so um it's difficult to yeah difficult to know before launch it is useful to have that though i always look at high guard as an example back earlier in the year which didn't do that at all and i do wonder if they had a small cohort of die-hard fans they might have had some defenders because i felt it came under quite a necessary level of attack um but it didn't have anyone sort of coming in and going of starters they might have been of course correct some of the decisions they made which weren't you know which i think were correctable um but um they didn't have anyone just going i know you're wrong about this on social media it was just it was just waves of negativity do you think the industry's given up on audience expansion um i don't think so i think audience expansion is happening sim i I think what's happening is the industry is stratifying where audience expansion is still happening, but it's happening largely in kind of the Middle East, Africa, where you're seeing large amounts of audience expansion, pockets of APEC.

39:57So I think there's still tremendous excitement. I do ad hoc consulting projects for people looking to kind of expand into emerging markets, and we see still tremendous excitement there. So I think there isn't necessarily a giving up on it, but I think there is a recognition that the US spender is nine times more valuable than one from MEA. and when we look at where the growth in the industry is coming from like for instance in 2025 70 % of the growth came from the west and from china and of that so they drove 70 % of growth of that growth 70 % of it came from monetizing existing users more so I think especially amongst the big publicly listed companies there is a recognition that if we want to hit our quarterly targets and we want to grow that that growth is likely going to come come from uh increasing revenue per user in key markets so sort of yeah maybe in the short term um i'm conscious of the time and i know there's a lot in your report i'm not going to go for all of it but obviously it does talk about where the growth is coming from and and it is coming from a lot of different markets different territories and i think i think my bigger concern is the jobs going out from the Western industry person's point of view, it's the jobs going to other markets.

41:26It's interesting, we've spoken to a few developers who are like, no, we're, you know, we had Harvey Smith on talking about his new immersive sim game. He made a big point that all the developers are American. And it isn't because he's been particularly patriotic. It's just, I think he's just trying to make a point that we've, we are, everyone's in the, you know, all the contractors we're using here. Fuse Games are making Star Wars Galactic Race. I made a point of saying that all of this work, work for higher teams, they're working more, are based in the UK. So there is an element of, I think, that, but for a lot of companies, there is a lot of outsourcing coming from a lot of moving talent or finding talent, particularly if they can.

42:01If you're making an RPG, why not work with talent in Eastern Europe? Because they're really good at RPGs as well. It's not like you're not just saving money, you're going to where the talent is. I mean, Kingdom Come Deliverance 2 is awesome. Yeah. Yeah. Or The Witcher. Yeah. It's all of that stuff. a boulder's gate but yeah that's my slight concern about that trend but there is some pushback yeah the report isn't yeah the report put it this way so my my colleague mikhiel has done work into market share gains by publishers and in mobile in particular i mean across the board we're seeing chinese publishers gain market share in every major market abroad so So from 29 to 2025, Chinese publishers market share in EMEA has grown from 19 % to 37%.

42:51And in the Americas, 11 % to 27%. So kind of doubling and almost tripling. So that is definitely a trend we are seeing. Yeah. Interestingly, I mean, obviously, there are the big live service games that are coming out. They're doing very well. When it comes to sort of the black myth Wukongs, there's a lot of it. I don't know how much of it and which naturally is going to grow the market share because there's more stuff coming out and being promoted on a global scale but I don't think I've seen anything particularly special it's interesting it's targeting audiences it's doing quite a good job with that but I don't think I've seen anything that's oh I'll be interested to see once all these games all the games you saw at Gamescom start coming to market how many of them actually hit and what that might mean for developers in China as well there's a lot there's a lot of it Yes.

43:42And I think part of the problem is that risk taking and cost management are two sides of the same coin. I know we often say, you know, like creativity and economics are fundamentally linked. I think Mitch Lasky has done a great job in his podcast of hammering this message home. But in markets where the economics are making more sense, that's sometimes where you're seeing more creative risks being taken. And it's those creative risks, as we've discussed, which are kind of going to surprise and delight gamers. So I think, for instance, I know that I might have been quite, some of the things I've said might not be tremendously optimistic.

44:22But for instance, I know people are really excited about regions like Vietnam and their game-making capacity and seeing loads of really interesting things happening out there. I'll ask one more question. You've talked about how franchises and sequels are becoming more and more dominant. Yes. And that's fine if you're a big publisher. That's what Xbox is doing. Fine, we'll just put our money behind our big franchises. What do you do if you're a smaller studio? Yes, I get asked this question a lot because I'm a consultant in New Zoom. We kind of often are helping with specific ad hoc client questions.

44:53I think the number one thing is to kind of embody the mentality and spirit of Jay-Z, who said, I'm not a businessman. I'm a business comma man, which is to think about how you can become this bigger and wider play, which you're looking to grab any distributional levers you can. And there are basically four big distributional levers that you can grab right now. So the first is you can tap into existing IPs. So if your IP isn't big, you can think about licensing one. we saw that the only free-to-play game to kind of really break through recently has been marvel rivals so leveraging the biggest ip there is tapping into existing play patterns so you can move someone else's community over into your game by you know leveraging you know a lot of big games have come out of mods but to give you an example of that i spoke to a really interesting studio over gamescom who have built um a game and their wish lists are doing really well and they basically formulated the game by looking at the genre they were playing in and they read basically every single steam negative review and they built it like a formula upwards going like okay we're going to have what is the existing audiences want and then let's take let's pain solve for these exact and precise negative ones so that's example of building around existing play patterns you can third distributional lever you can grab is community so we were talking about this more about kind of building around early access and that.

46:28I think Helldivers 2 is a really good example of a game built around community because the actual play structure of having major orders. So for those who haven't played Helldivers 2, major orders are something the community has to do together in order to get the goal. That necessarily encourages and fosters discussion and debate about how we're achieving that major order. And then the final one is just to think about your own studio's brand power, about its own reputation, about building that out over time. I think a really good example of a studio that is obsessed with its own brand power is like CD Projekt.

47:06And, you know, for instance, there's a joke, right, that The Witcher will never come out. That in and of itself is testament to the brand power because everyone assumes that they've learned from the mistake of Cyberpunk and they will take as long as it takes to get necessary and people know that and they'll wait to buy it. so um yeah grab grab those distributional levers um think of yourself as jay-z yeah it's from it's remarkable really cd project by the time this has gone out we would have done our big cd project interview and um it's remarkable how much good will they have after considering how disastrous their last major launch was yes yes and it is and okay they've done they've fixed it and they've done a massive dlc update that was really good and stuff but um there is so much you know they They won Gamescom with a remaster.

47:53I know. Incredible. Sign of the times too, though. It really is. That's a good note to leave on, actually. Ronan, thank you so much for your time. The news report, is it fully out next week? I'm not the best person to ask, but I think it is already out. But yeah, it could be next week, the full one. Thank you so much. Wonderful to be on the show. Thank you to Ronan there. All that's left for me to do is wrap up the news from the last week. And we were at Gamescom last week. there's lots of news coming out gamescom we've covered all of that already but now we have some gamescom stats so gamescom 2026 drew in 368 000 visitors from 131 countries that's a six percent increase over the previous year so we've known gamescom counts visitors as individual people going through the turnstile so if someone goes for four days that counts as four visitors is a football number effectively it's still huge in total uh 1743 companies from 66 countries exhibited that's up 11 from 2025 it's apparently a sellout although i did see one space just saying international exhibitors account for 72 participants 36 000 trade visitors came along and around 50 of those came from outside of germany so great numbers for gamescom there the most viewed game of gamescom was the 11 year old bewitcher 3 cd project showed off dlc for the game songs of the past it's the first dlc for the game in a decade if you um go back to our interview on tuesday with cd project red ceo it's really uh fascinating that it didn't just show off the dlc for the game there was a remaster of the original 2015 game that was shown as well the witcher 3 remastered comes out on september 29th i think space there is not far away um interestingly a game that's a bit like the witcher made by former witcher devs is out this week blood of the dawn walker so you know a little bit competitive there the witcher 3 clocked up 50.7 million trailer views going to level up number two trailer was anata from nettees with 47.2 million views followed by hooverse is noticeable with 45.5 million views over to saudi arabia and savvy games group ceo brian ward has stepped down after five years in the role he's going to be replaced by turkey al-naweiser i probably pronounced that badly i apologize he's the deputy governor of saudi arabia's public investment fund piff and head of international investments division he will he will be the interim acting CEO.

50:12Savvy is the group that obviously acquired Scopely and Niantic. If you don't know, they are funded and owned by the PIF. PIF is the major investor behind EA. They're part of that big$55 billion acquisition. So big, big organisation and new CEO coming in. Sort of loosely connected to EA, this story, is Star Wars Zero company developer Bitreact has furloughed around 80 % of its workers ahead of the game's releases, according to Gamefile, according to our friend Stephen Tortillo. the decision was not related to ea star wars or disney i'm assuming there was some other deals something that fell through some game project that sort of collapsed that meant that they had to furlough a bunch of staff i don't know the details certainly surprising uh the game has reviewed very well but as i've sort of said earlier that um there's a lot of these xcom like games coming out i'm not quite sure how big the xcom like genre is but anyway the game has gone down very well journalists love it um it seems to be doing all right on steam so hopefully hopefully hopefully it'll find its audience and some of those staff can come back to bit react to the fact they've been furloughed suggests that they do expect to be able to bring them back next story godot game engine company w4 games has raised 18 million dollars in a series b funding round led by tencent it was also signed an agreement with the chinese conglomerate to scale godot in asia w4 has raised 33 million dollars in total from all sorts of different investors it was formed in 2022 by the founders of godot which is an open source engine to provide services to developers using the tech such as console porting so this is the commercial element according to steam db over 1250 games are using the god o engine so it's certainly growing it's only getting bigger let's talk about tariffs so like playstation and nintendo playdate maker panic has received a refund from the us government after the tariffs introduced last year were deemed illegal unlike playstation nintendo playdate is passing the refunds on to consumers which it had initially charged customers more for now nintendo argues actually mostly swallowed the costs of those tariffs um nintendo didn't actually increase the price of the switch 2 they did increase the price of the switch 1 slightly um and playstation makes similar arguments going back to saudi arabia roblox will open headquarters in riyadh in saudi arabia this is to support its creator program in the middle east and north africa there's a lot of growing developers there some interesting talent emerging out of that market elsewhere nettees is free to play wuxia open world action rpg where wins meet now has 100 million players only came out in november 2025 it is of course free to play um but uh fantastic numbers there 1047 games is shifting away from live service shooters and ending active development on impulse and split gate arena reloaded and finally uh we're going to an event in october called game republic new horizons i think i mentioned it before i'm going to be interviewing ken kutaragi on stage i i may also be doing other interviews um i'll let you know nearer the time about that.

52:57But they've just announced a new speaker. It's IO Interactive CEO Hakan Abrak, who obviously has been on this show many times. He will host a 007 First Light session at the event. That's it for me. That's the roundup. Thank you for joining us. We will be back next week with more news, analysis, insight and interviews. In fact, our very next show is going to be with Maverick Games. I did a big interview just before Gamescom on Clutch and the journey to it, finding a publisher. It's surprising, shall we say. But until that time, that's it from us. if you would like to make sure you don't miss it, head to thegamebusiness.com, put in your email, and you'll get an alert every single time we do a new episode.

53:31But until then, thank you for tuning in.