As to why Rockstar needed guaranteed funds up front perhaps this quote from Pachter would suffice:
"We think that it is important to point out that U.S. industry software sales have grown by over 58% from the November 2005 – January 2006 period through the November 2007 – January 2008 period, while Take-Two's publishing revenues have declined by almost 23%. This is clearly a company that is losing market share, and as we review the lineup for the balance of 2008 and 2009, we see more of the same type of games we have seen over the last three years," he said. "The company's sports lineup continues to underperform, generating only $32 million of sales (26% of publishing revenues) for the key holiday period. This figure calls into question whether Take-Two can deliver sports revenues of $250 million for FY:08, as management implied in a prior earnings call."
5
As to why Rockstar needed guaranteed funds up front perhaps this quote from Pachter would suffice:
"We think that it is important to point out that U.S. industry software sales have grown by over 58% from the November 2005 – January 2006 period through the November 2007 – January 2008 period, while Take-Two's publishing revenues have declined by almost 23%. This is clearly a company that is losing market share, and as we review the lineup for the balance of 2008 and 2009, we see more of the same type of games we have seen over the last three years," he said. "The company's sports lineup continues to underperform, generating only $32 million of sales (26% of publishing revenues) for the key holiday period. This figure calls into question whether Take-Two can deliver sports revenues of $250 million for FY:08, as management implied in a prior earnings call."