Leaks from internal sources are part and parcel when it comes to development cycles leading up to highly anticipated AAA video game releases.
Less common are leaks stemming from extensive hacks — let alone from a publisher as calculated with info dumps as Rockstar Games, the developer and publisher of the mega-popular “Grand Theft Auto” franchise.
That’s exactly what happened over the weekend.
Rockstar and parent company Take-Two Interactive put out statements Monday confirming that Rockstar’s systems had been hacked after 90 videos of an allegedly 18-month-old build of “Grand Theft Auto VI” flooded the web, well ahead of the game’s expected release in 2024 or 2025.
The good news is that the hack isn’t expected to disrupt active live services — namely, Grand Theft Auto Online — at Rockstar, nor is the disruption on development of “GTA VI” expected to be a long-term affair, despite persistent rumors that source code for the game was being held for ransom.
Furthermore, Take-Two's own assurance that the hack had been isolated and contained successfully countered a 6% drop in company stock during premarket trading before closing at $125.08 Monday, slightly above Friday’s close.
There’s an obvious logic to understanding that leaked footage of unreleased games’ early builds is highly unlikely to be fully representative of the finished product, but the brief investor concern over the hack has much to do with just how crucial “Grand Theft Auto” is to Take-Two.
While Take-Two has always been more than just Rockstar Games, the company has rapidly added to its studio staff headcount since the 2013 release of “Grand Theft Auto V” and its online counterpart. Nearly 10 years later, Take-Two's studios are now more than three times as large. That excludes the additional headcount coming from the company’s completed 2022 acquisition of mobile company Zynga.
The value a new “Grand Theft Auto” presents to investors after “GTA V” delivered such a strong decade for the company is undeniable. Of 380 million units sold within the entire franchise, “GTA V” is responsible for at least 170 million units sold to date. The game alone reached $1 billion in retail sales quicker than any entertainment release in history and is the best-selling game of the last 10 years domestically, per NPD Group tracking.
However, Rockstar has been in a transitional period. “Red Dead Redemption II,” the publisher’s last new game, released in 2018 amid reports the studios that worked on the game suffered from an extensive crunch culture that saw employees working “100-hour weeks” to get the game out the door, a figure cited by Rockstar’s own co-founder and then-VP of creative, Dan Houser.
Houser’s departure from the company was formally announced in 2020 after an extensive break in 2019, and the company has since undergone efforts to reduce crunch throughout development of “GTA VI.” While such efforts are undeniably beneficial for Rockstar employees, plans to remaster older hit games in the publisher’s catalog have been shelved, and major themed content updates will no longer be coming to “Red Dead Online,” all because of development support being redirected to “GTA VI.”
This is to ensure the since-hacked game hits its targeted release, but the cancellation of remasters and content updates that could otherwise be financially lucrative for Take-Two doesn’t bode well for investors, making the $12.7 billion Zynga purchase a necessity to bridge the release gap and flood Take-Two with reliable mobile income.
So far, so good. The second quarter of 2022 saw Take-Two mobile net bookings increase more than 300% year over year to $370 million, accounting for 37% of total net bookings. This takes some of the pressure off the current version of “GTA Online” to be the principal bread and butter for Take-Two until “GTA VI” is out the door and ought to be a go-to factoid for any investors with lingering concern over the potential for a delay in its release window.
Still, that doesn’t mean the window of impact for the hack isn’t closed.
The person responsible is said to have hacked Rockstar through the company’s internal Slack workspace via the exploitation of an employee’s account. Not only is this identical to the recent hack of Uber, but it may be the same hacker who is responsible for the intrusion of both companies’ internal systems, if claims made by the individual in question turn out to be true.
Given the flexibility Rockstar and many other gaming companies have granted employees in working from home, hacks of this magnitude could see corporate policy shift and demand work move back to offices as a means of reducing the sharing of pertinent data across software such as Slack.
“GTA VI” could still release as planned with no financial impact from the hack, but that wouldn’t undermine the concern expressed by Rockstar and investors alike, as hacks can still be highly disruptive to marketing strategies. Such was the case in May 2020 when Sony studio Naughty Dog suffered a hack that resulted in footage from “The Last of Us Part II” game being leaked more than a month ahead of the game’s release.
Unlike “GTA VI,” the “Last of Us” game was near completion, but the leaked footage contained massive spoilers regarding the fate of the first game’s protagonist in addition to an additional major twist halfway through the game. Despite widespread critical acclaim, the game suffered heavily from mixed player reception and sold about half as many copies as the first installment, meaning the leaked spoilers may have discouraged some gamers from buying the title.
“Grand Theft Auto” may have too-big-to-fail status, but the crucial role it plays at Take-Two will never exempt it from the panic of an inopportune, criminal interception in strategy.
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