RealTime IT News

Take-Two: All Aboard

On the heels of being named #93 in Business Week's top 100 information technology companies, Take-Two Interactive Software added yet another cog in its rapidly growing gaming powerhouse. The New York-based publisher and distributor of games for the PC, Sony PlayStation, Nintendo 64 and Game Boy, and Sega Dreamcast consoles announced plans to acquire strategy game developer, PopTop Software.

Not much will change over at PopTop, as its cozy ten person development team will remain comfortably situated in the Show-Me State. Currently, all its attention is devoted to its newest computer strategy game, Tropico, scheduled for release early next year. Set on a tiny, remote Caribbean island, Tropico puts players in the role of newly-inducted ruler to this poverty-stricken, lawless isle. Make your nation prosper, build hotels, mines, and factories, all while placating internal and external factions. Fail diplomatically, and 3D gamers will end up with a revolt on their hands.

Tropico follows the gaming style PopTop instituted with Railroad Tycoon II, released in 1998. In this simulation game, up to 16 players compete as powerful railroad barons in a game of strategy that spans the entire world, progressing through two centuries. Lay tracks, build stations, connect populated cities to transport passengers or goods, schedule train routes, and buy and sell stocks in a realistic, in-game economy. With half a million copies sold since its debut, Railroad Tycoon II heralded PopTop into the limelight, as its first title as a complete design shop.

Available in both PC and Mac versions, PopTop's titles are published by Gathering of Developers (G.o.D.), a game publisher launched in 1998 by five PC game makers seeking to turn the price-gouging publishing industry on its ear. Offering developers feature billing on game titles, no Wall Street earnings-induced deadlines, and royalties 50-60% higher than traditional publishers mete out, G.o.D became an immediate smash hit.

Take-Two and G.o.D. have been partners since the Gathering's early days, having provided the independent PC publisher with initial funding in 1998 and then acquiring a 20% stake in early 1999. Combined with Take-Two's Rockstar Games video console division, many of the Gathering's PC games, including Railroad Tycoon II, were able to spill over into the PlayStation and Dreamcast markets as well.

Take-Two acquired the remaining 80% of G.o.D. just this past May, but like PopTop Software, the Gathering also operates as a wholly-owned subsidiary. The Gathering's management and Dallas-based headquarters were kept intact, as was its 'developer first' credo, while its reach was broadened extensively through Take-Two's North American and European distribution channels.

For Take-Two, the G.o.D. acquisition brought a catalog of new titles for distribution, including G.o.D.'s publishing of Apogee/3D Realms' Duke Nukem and Ritual Entertainment's Heavy Metal F.A.K.K.2. Despite the tremendous growth opportunity G.o.D. presented Take-Two, its stock price has steadily traded in a very narrow $9.50 to $13 range since the acquisition was announced.

Prior to April's market downturn, Take-Two watched as its share price looked to be on a run past $20, in conjunction with the game distributor's land grab of Israel-based Pixel Broadband Studios. With the market frothy for anything broadband, Broadband Studios' multiplayer gaming technology, enabling multiple players to engage in real-time inter