‘Grand Theft Auto’ maker ambivalent about VR

Attendees participate in VR virtual reality during E3 Electronic Entertainment Expo 2016 at Los Angeles Convention Center on June 14, 2016 in Los Angeles.
Daniel Boczarski | Getty Images
Attendees participate in VR virtual reality during E3 Electronic Entertainment Expo 2016 at Los Angeles Convention Center on June 14, 2016 in Los Angeles.

You can't walk 15 feet down the halls of the E3 show floor without someone thrusting a virtual reality headset at you this year. If there's one overlying theme at the videogame trade show's biggest convention, it's that VR is coming in a big way.

But Strauss Zelnick, CEO of Take-Two Interactive Software, said he's still skeptical about the technology.

"Our corporate strategy is to be where the consumer is," he said. "To the extent that new mechanics offer more power for us to make more exciting games, great. I think there may be some opportunity there eventually, but what I see so far isn't a game changer. … It's still a zero revenue business."

He's not trusting those misgivings completely, though. While the company has not announced any VR titles, Zelnick says its research and development arm has been exploring the technology for some time. And should consumer adoption VR grow much faster than anticipated, he says it will be ready.

"We're in a position technologically where we could come very quickly, but that said I don't want to compromise the company's balance sheet until I'm sure something actually exists," he said.

Take-Two is a company a lot of people are paying attention to this year, despite that fact that its most visible developer – Rockstar Games, makers of "Grand Theft Auto" and "Red Dead Redemption" – has not yet announced its new game. The company's lavish E3 booth, promoting this fall's "Mafia III," is the first thing many E3 showgoers see when they walk onto the show floor. And in investment circles, there has been chatter about whether a merger between the company and Ubisoft would make sense.

Zelnick, naturally, didn't discuss Ubisoft directly. (Nor did Ubisoft discuss Take-Two.) However, he did say the company has its eyes open when it comes to M&A.

"We've been very clear we have a lot of cash, we have no debt," he says. "We've said we would actively consider an acquisition as long as it's a strategic fit and as long as it supports the nature of enterprise. … I wouldn't rule out any particular opportunity in this space when seen through that lens."

While there's no new "Grand Theft Auto" game looming, don't expect Take-Two to have a controversy-free holiday. "Mafia III" is a gritty game about organized crime, but what's more likely to turn heads is the game's approach to racism. Set in a New Orleans-like city in the late 1960s, the game features a black protagonist – and isn't afraid of the n-word.

It's a fine line to walk between being authentic to the time period and gratuitous – and one that's likely to be debated. But Zelnick says he believes the development team will strike the right balance.

"Art can be brutal and still uplifting," he says. "There's a difference between being realistic and challenging and being exploitive. Our goal is to stay on the realistic and challenging line, which is why I stand behind everything we do. … We want people to think and ask questions, but we don't intend to — nor do I think we do — play to base instincts."