Why This "Bioshock" to Take-Two's System Might Be Good Over the Long Haul

Subsidiary Irrational Games to close as founders rethink the future of gaming.

Feb 20, 2014 at 7:00PM

A sad day for Irrational Games might end well for Take-Two Interactive (NASDAQ:TTWO), Fool contributor Tim Beyers says in the following video.

First, the bad news. After 17 years, Irrational Games, the Take-Two studio subsidiary responsible for the megahit Bioshock Infinite, is shutting down. Talented people will be laid off, which stinks. Yet Tim says there's hope to be had in what Irrational co-founder Ken Levine has planned.

Writing in a blog post, Levine said he plans to start anew inside Take-Two with a skeleton team of just 15. Together, they'll be working on what he describes as "narrative-driven games for the core gamer that are highly replayable." How that will manifest isn't entirely clear at this point, though Tim says it seems like a massive undertaking.

Importantly for investors, Levine said he was "prepared" to jettison from the company he founded and create a new start-up. Take-Two instead convinced him to develop the project as an employee, as if he were an entrepreneur in residence at a venture capital firm. Tim says that's a hugely bullish sign, reflecting Take-Two's willingness to bet on proven innovators.

In the meantime, Levine said that unwinding Irrational will involve attempts to place those laid off with other Take-Two or external studios and provide financial support as developers prepare their portfolios and seek new gigs elsewhere. A bummer, certainly, since layoffs are always a bad outcome. Yet there's reason to be optimistic amid the fallout from Levine's ambitions. In trying to create something radical, his efforts may prove beneficial not only to Take-Two investors, but also to an industry that needs as much innovation as it can get.

Now it's your turn to weigh in. Are you enthusiastic about what Levine has planned, or would you rather Take-Two stuck with Bioshock? Please watch the video to get Tim's full take on the news, then leave a comment to let us know where you stand, and whether you would buy, sell, or short Take-Two Interactive stock at current prices.

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Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team and the Motley Fool Supernova Odyssey I mission. He didn't own shares in any of the companies mentioned in this article at the time of publication. Check out Tim's web home and portfolio holdings or connect with him on Google+Tumblr, or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.

The Motley Fool recommends Take-Two Interactive. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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