How to build a $500 million business inside a video game.

Upon its release on September 17, 2013, Grand Theft Auto V became not just the fastest-selling video game ever, but the most financially successful media title of all time[1]. It made $800 million worldwide in just 24 hours. It topped $1 billion in revenue in three days. In six weeks, developer Rockstar had shipped 29 million copies of the game, and as of May 2019, that number has exceeded 110 million.

But for Rockstar, physical sales would just be the tip of GTA V’s gargantuan financial iceberg. The game was designed from the ground up to be more than a standalone title. It was designed to be a continuous moneymaker for years to come, to keep players hooked, playing, and paying well after its release. And it did. This is the game that changed how video games were made and sold in the past decade, and this is the game that brought an internet-savvy business model to the entire gaming industry.

At Microsoft’s formal press conference at the 2013 Electronic Entertainment Expo (E3), the company announced their upcoming Xbox One gaming system would require a constant internet connection. Every 24 hours, the console would run an “online check” to ensure the player was playing a game linked to their personal Xbox account. It was an anti-piracy measure (at least that’s how it was presented to consumers), but it established a wider norm for one of the biggest companies in console gaming: Playing games meant going online, even if you were playing by yourself.

Gaming’s foray into constant internet connectivity was not well-received by general audiences. There were too many accessibility issues, with many critics pointing out how the change might keep low-income communities or active military members from playing games. There were myriad privacy concerns, too[2]. And yet from an industry standpoint, the new norm meant developers could alter their design strategies to take advantage of the new relationship between their products and the web. No one was more prepared for this shift than Rockstar Games, who was on the verge of releasing another entry in their hugely successful Grand Theft Auto franchise.

Rockstar had been one of the most forward-thinking, consumer-attuned game developers for over a decade by the time GTA V hit stores. It’s rare that developers find overlap between crowd-pleasing game design, mature content, and critical acclaim, but Rockstar found that target over and over and over throughout its history.

It started in 1999, when the first Grand Theft Auto game was released for PlayStation. While the franchise would later adopt a 3-D approach, GTA began as a top-down playground shooter. You could do many of the things you could do in the more technologically sophisticated sequels—steal cars, gun down rivals, flee from the cops—but what stood out above the startling content was the freedom granted the player. While the mission objectives were set in stone, the “how” was all up to the person holding the controller, and that came to define the franchise’s approach to gameplay design (as well as its approach to morality[3]).

In the wake of the original, Rockstar hustled out Grand Theft Auto II in 1999 and GTA III in 2001. The latter year also saw the release of Max Payne, the company’s much-acclaimed shooter franchise that not only gave the world “bullet time[4],” but told one of the darkest, most adult stories games had seen to that point[5]. More GTA and Payne sequels followed in 2002 and 2003 before 2004 saw Rockstar release Grand Theft Auto: San Andreas, a game that made every kid under the age of 18 spin insane lies to their moms about why they should be allowed to have it, made every adult who played it leak endorphins out of their ears, and made Rockstar one of the undisputed best developers in all of video games. San Andreas could have paragraphs written about its narrative depth, its American satire, its boundary-pushing content, its mind-boggling sense of freedom, its enormous map, and its unprecedented quality on an unheard-of scale. Instead, we’ll leave it at this: San Andreas was the fucking shit.

From there, Rockstar couldn’t lose. They remixed the GTA formula into a high-school rebellion game called Bully in 2006. They released a perfect critique of the American dream in 2008 with Grand Theft Auto IV. They made a handheld version of GTA in 2009 with Chinatown Wars. In 2010, they made another Greatest Game of All Time candidate with the Western Red Dead Redemption[6], and in 2011 they revolutionized character animation with L.A. Noire. Max Payne 3 preceded GTA V in 2012, and while it “only” managed to be incredible instead of industry-shaping, it cemented that trilogy’s legacy as one of gaming’s greatest cult hits. It should be clear by now: With almost every game they release, Rockstar shapes the industry.

And Grand Theft Auto V was no different. When the game came out, hype had built to such a fervor that by the time the breathless reviews started publishing, the praise felt more like a fulfillment of prophecy than honest reaction. GTA V was the swan song of its console generation[7], critics said, the pinnacle of everything those machines could achieve and a glorious examination of the popular culture the series was interacting with. There was so much to do you could pour triple-digit hours into single-player endeavors aside from the campaign, and all of these distractions were so well-considered and refined that what functioned in GTA V as mere minigames—golf, tennis, street racing—could be released as quality standalone titles on their own. GTA V was so much, done so well, it could be considered a masterpiece based on achievement alone. Its primary innovation, upon release, was its immensity.

Those looking for a typical fiendish, winking, cackling Grand Theft Auto story weren’t disappointed in V, either. The game’s main narrative flipped between three protagonists—a low-level gangster, a washed-up white-collar criminal, and an unhinged psychopath—before bringing their stories together for multi-layered Heat-style heists, which persist as some of the most adrenal missions in video games. This is where GTA V introduced its one new gameplay mechanic: the ability to switch between all three characters at will, without a load time or a lag.

When a mission put Trevor, Michael, and Franklin together, the player could choose whichever role they wanted to fill. You could handle crowd control as Trevor, crack a safe as Michael, or position the getaway car as Franklin depending on your interest, but the perspective swaps were so fluid and easy that if you wanted a taste of all three, you could cycle through the characters without interruption. It was damn fun, inducing the unique sense of I-can’t-believe-I’m-getting-away-with-this glee that defines the GTA series.

As the franchise’s criminality reached epic new proportions, so did its commentary on American culture. If there’s a criticism to be made against GTA V, it’s that its messaging is a little confused when caught between the mechanics of the game and the storytelling. For instance, the character Trevor was designed as a representation of the stereotypical “dangerous” Grand Theft Auto player, someone who played the games as an excuse to actualize their worst impulses—kill cops, abuse citizens, and engage in crime for the sake of it. Trevor-centered missions involved murderous rampages and high levels of carnage, but they were so indulgent they came off as too self-satisfied to issue any real critiques against the gaming subculture Rockstar had perpetuated.

Trevor was GTA’s way of engaging with its own reputation, and perhaps its own fanbase, too[8]. It was a bold, meta way to heighten the series’ trademark satire, but it didn’t quite manifest in anything as provocative as previous entries of the series. Really, GTA V’s take on vapid internet culture, id-fueled gamers, and greed-rewarding American capitalism was ironic, given Rockstar’s ultimate plans for the game: GTA Online.

The version of GTA V critics praised as a masterpiece wasn’t the entire experience. Before the game’s launch, Rockstar promised consumers that in the months after release, they would roll out what they called GTA Online, a new concept for online multiplayer. Most games in that generation treated multiplayer like Call of Duty or Halo, where the internet was a bridge between players. With GTA Online, Rockstar wanted to treat the internet like a community, or really, a marketplace.

There are multiple layers to GTA Online, but at its foundational level, players share the open world of the game’s single-player mode with other gamers. From this hub, they can run around and do classic Grand Theft Auto things, but they can also engage in an online version of the single-player mode’s heist missions. It’s a cool idea, and Rockstar presented the experience as if it was an entirely separate game. Based on the amount of time players poured into GTA Online, it wasn’t an inaccurate sell.

GTA Online incorporated a lot of role-playing elements into its open-world mechanics. Players could gain experience and level up their abilities in things like driving and fighting, and when they reached certain levels, new items and weapons and vehicles would become available for purchase with GTA’s in-game currency. But here’s where Rockstar changed everything: Players could bypass those skill requirements and prices if they spent real money instead.

In gaming, this concept is known as microtransactions. Before GTA Online, it was most prevalent in mobile games like Candy Crush or Clash of Clans, where players could enjoy a free-but-limited version of a game before spending money to unlock a broader experience, power-ups, or even just the ability to play longer.

Microtransactions are a genius money-making tactic, especially on phones, where the dopamine hits urge people to play more, more, more and thus spend more, more, more. That kind of addiction-adjacent ploy doesn’t quite translate to something like GTA V, but the idea is similar: Rockstar presented something as a complete experience, but put up paywalls in front of “bonus material” to create further demand from people who already owned their game. If players didn’t want to hustle around in GTA Online earning enough points to buy that elite-level sports car, screw it, what was 10 bucks?

Well, all those 10-buck moments eventually added up to nine-figure revenue totals. Today, it might even be more. The most recent widespread revenue report for GTA Online is from 2017, which says its microtransaction system had earned Rockstar $500 million since October 2013. That’s a whole lot of gamers paying real money for fake clothes, fake cars, and fake guns.

Rockstar fed the frenzy, too. As recent as 2018, the company released new expansions and updates for GTA Online, and while some of these housed new gameplay modes and new missions (what we classify as “playable content”), most of the new rollouts were just fresh slates of cosmetic changes. Business-wise, it made sense. It’s easy to program a hat. It’s hard to program a whole new movie-quality heist for consumers to experience[9].

Meanwhile, the single-player updates that had been the franchise’s primary point of emphasis up to this point? They never came[10].

How Grand Theft Auto V capitalized on the digital marketplace brought video games into a new era of relating to the internet and relating to internet-savvy consumers. Amid the jaw-dropping success of GTA Online, most big-time developers have tried, and are still trying, to jump into the same money pit as Rockstar’s Scrooge McDuck.

There’s been good and bad within this feeding frenzy. On the positive side, free video games are more prevalent than ever, and many have found a balance between fun base-level gameplay and revenue-boosting add-ons. Fortnite is probably the best modern example of a well-run, fair in-game economy. The base game—a battle royale arena shooter—is free, but players can spend money on cosmetic upgrades like goofy costumes for their characters. You can’t buy your way to an advantage in Fortnite, but the game still offers a sense of individual expression the internet has made an expectation. These microtransactions feel harmless, regardless of how you feel about teenagers blowing their money on outfits for an avatar.

Other games and developers, however, have tried to incentivize microtransactions by letting players pay for competitive shortcuts. This model is derided within the gaming community as “pay-to-win,” and some pay-to-win models have damaged the reputations of entire companies.

Star Wars Battlefront II, a shooter from publisher Electronic Arts, is the most notorious example. Battlefront II’s multiplayer came with a loot box system, a common microtransaction concept in which players spend in-game or real-world currency on the chance to open a mystery package that will reward them with random items. There’s no way to tell what’s inside a loot box before you buy it, which works two ways: When a balance is achieved between the opportunity to open a box and the likelihood of finding something great inside, it can be triumphant for players, but when the barrier of entry is too high and the odds too stacked against players, the randomization is frustrating for people who keep spending but never receive the reward they’re looking for. Battlefront II’s loot box system was so unrewarding it seemed designed to force players to spend real money instead as a workaround.

What’s worse, Battlefront II’s loot boxes contained gameplay advantages, a huge no-no in the gaming community (because rich players can just buy boxes until they have the best stuff). Imagine a casino that allows customers to buy better cards and keep winning, fueling a cycle in which rich people win, spend those winnings to win more, and so on.

But now imagine the casino requires you to beat this system inside a game like roulette for the chance to play Texas Hold ‘Em. Battlefront II locked its most coveted content behind massive in-game currency prices, in effect forcing people to pay real money for things most thought should have been standard. For example, if players wanted to play as Darth Vader—you know, the most famous character in Star Wars—they would have to “grind” for over 40 hours to earn enough in-game currency to make the purchase. The alternative? Fork up some cash.

And remember, all of this comes after people have paid full price for Battlefront II in stores. It’s like if our metaphorical casino had a cover charge.

When details of Battelfront II’s microtransaction system reached fans who had pre-ordered the game, the community starting doing what gamers do best: bitch and moan. Except this time, they had good reason for complaining, and Battlefront publisher EA scrambled to put out the fire. The company took to a Reddit forum where people were discussing Battlefront II’s pay-to-win system and posted the following immortal quote:

“The intent is to provide players with a sense of pride and accomplishment for unlocking different heroes.”

The top response from the community:

“I wonder if Burger King wants to sell me a sense of pride and accomplishment by making me work 10 hours for my fucking fries.”

You can understand why people were upset. EA ordered Battlefront II developer DICE to make some hasty changes to the reward system, and while DICE lowered the cost of the unlockable heroes, they also decreased the amount of in-game currency you earned for most objectives. In the end, any changes were moot; the damage was done. Battlefront II tanked. It’s most famous for taking GTA Online’s marketplace system way, way too far[11].

The most compelling implication of the microtransaction system probably hasn’t come fully to bear, though there’s evidence the system can make a variety of impacts. On one hand, video games are expensive to purchase—usually about $60—so if companies lower the in-store price because they know there will be tons of revenue streams from the game’s internal marketplace, it makes for an inclusive, more diverse community able to play the game (granted, this hasn’t happened yet). On the other hand, if publishers double down and make players pay for the full game and competitive advantages inside that game, their game becomes classist. There have always been haves and have-nots in video games; it’s just never been clearer than under the microtransaction model.

Even when microtransactions are strictly cosmetic, they carry strange implications. Every avatar in GTA Online is essentially a walking advertisement for whatever outfit they have on, whatever vehicle they’re driving, or whatever plane they’re flying. It’s weird. The differences are small right now—you can’t tell who the wealthy players are by their avatars—but one can imagine a future where a penthouse apartment in GTA Online is a lot more reflective of the owner’s real life than it is now. It feels like something developers and publishers could exploit in a major way.

Grand Theft Auto has always dealt with exploitation, though. The series has exploited players’ tendencies for anarchist behavior, sure, but it’s also highlighted the exploitation that exists in modern America. GTA V examines crime in the manner of all its predecessors, but it also takes the franchise’s broadest look at popular culture yet. It has a take on social media influencers, fast food, cubicle jobs, tech bros, wellness, the Second Amendment, and the criminal justice system. Heck, Grand Theft Auto V even has a take on Grand Theft Auto.

But while the game appears to be making a grand statement on its face, its inner parts contradict its points of criticism, working to exploit the very person playing it. Grand Theft Auto—the series and the institution—is about money. Every game of the series communicates the idea that in this game’s world, money is power, and sooner or later you’re going to have to decide how far you’ll go to obtain it. Stealing a car in GTA isn’t about having the car, it’s about using the car as a shortcut. It’s not just one less rule you have to follow; it’s one less expense.

Sooner or later, GTA argues, everything becomes a business, and in the 2010s the internet became a business as much as it grew as a community. Grand Theft Auto V understood this best, and it leveraged this understanding to create GTA Online and cash in. Unfair? That’s Grand Theft Auto, baby. It was never about justice.

[1] MarketWatch gave GTA V this title in 2018, when it exceeded $6 billion in revenue and passed movies like Gone with the Wind and Star Wars in inflation-adjusted revenue. More crazy stats from that report: GTA V was the sixth best-selling game in the United States in 2017, four years after its release. Its PlayStation 4 sales figures outnumber its Xbox 360 sales figures, and it launched on the latter and was re-released on the former. Finally, GTA V sales are greater than sales for GTA III, GTA: Vice City, GTA: San Andreas and GTA IV combined.

[2] At the same E3 conference, Microsoft announced new updates to their much-maligned Kinect peripheral, one of the motion-control copycats that failed to replicate the success of the Nintendo Wii (Sony’s version, if you remember, was the PlayStation Move controller, which looked like a blue sno cone and somehow felt even more ridiculous to use). What was meant to distinguish Kinect was its implementation of a camera, and at this E3, Microsoft explained—in a back-handed way—this camera could be utilized to watch players and sell their information to advertisers. Not great.

[3] Other odd little notes about the first GTA: Players had limited lives, earned points by completing criminal actions, and could name their character whatever they wanted (naming yourself certain things doubled as a cheat code mechanic). The best tidbit? Grand Theft Auto was originally called Race N’ Chase. Hilarious.

[4] This let players put the action in slow motion to execute more finesse-centric gunplay moves, like The Matrix.

[5] As Max Payne, the player took painkillers as a healing mechanic (Max was an addict), and one level had you run through a maze of umbilical cords in Max’s nightmares, following the sound of his dead baby crying. Yeah, Max Payne wasn’t fucking around.

[6] RDR was another near-inclusion for this project, as was its sequel. If by this point you’re wondering how a company can make so many games that aren’t just acclaimed, but considered boundary-pushing masterpieces, the answer is complex and probably worth a book by itself. The short answer, unfortunately, is probably a mix of technical genius, vicious working conditions, elite talent, and ruthless standards.

[7] Xbox 360 and PlayStation 3.

[8] Sometimes this manifested explicitly. Trevor’s introduction in the game sees him kill a character named Johnny Klebitz, the protagonist of the GTA IV expansion The Lost and Damned. Johnny was president of the Lost motorcycle gang, and someone players had likely spent hours with. The irreverent death scene—in which Trevor stomps Johnny’s head in after Johnny accuses Trevor of having sex with his girlfriend—was a fitting introduction to Trevor, but a tough way to go for Johnny. GTA V had a hard time taking moments like this as chances for self-reflection. Instead, it treated them like punch lines.

[9] It’s tricky here not to editorialize, because in fairness to Rockstar, GTA V was already one of the most expensive video games ever made, costing about $250 million. The company clearly cared about delivering a quality experience, and if this chapter is any indication, they succeeded beyond anyone’s lofty expectations.

[10] This has been a shock to many gamers, and despite GTA V’s robust campaign mode, the absence of single-player downloadable content is one of the biggest disappointments Rockstar has delivered, if only because their track record in the area was so incredible. GTA IV was followed up by acclaimed expansions Ballad of Gay Tony and The Lost and Damned, and Red Dead Redemption’s Undead Nightmare DLC was so rich and rewarding—it populated the game’s map with a zombie horde, added tons of new secrets and collectibles, and packed in a dozen hours of new story missions—it had legitimate Game of the Year considerations from a few different outlets. No single-player expansions for GTA V was a bummer.

[11] Not to belabor the point, but this fiasco’s effect on EA was rather astounding. On the day Battlefront II launched, the company’s share price dropped 2.5 percent. By the end of the month, EA had lost $3 billion in stock value.