Let’s hear it for violence and mayhem. Grand Theft Auto IV, the latest instalment of the video game franchise published by Take-Two, racked up sales of $500m this week after seven days on release – more than double the record weekly take for any movie. Rival Activision had exceptional results on Thursday, with sales of Call of Duty 4 pushing profits well above estimates. While music companies and movie studios grapple with piracy, games publishers are in a sweet spot. It is much harder to copy software for the new generation of consoles. New instalments in a games franchise tend to be a technological and an artistic leap forward. On a cost-per-hour basis, a $60 game may be better value than a $20 CD. And, unlike the “dream factory” movie studios of the 1930s, there is no risk stars will defect to a rival producer or, even more inconveniently, die.

The flaw in this picture is that most games publishers don’t – yet – make spectacular profits. Thanks to heavy marketing and development costs, Activision’s net income margins over the past five years have averaged about 6 per cent. Electronic Arts, the sector leader by sales, has more respectable margins of 11 per cent. Still, in-house development is risky: for every slate of 10 projects, perhaps two will recoup costs. And industry consolidation adds the threat of talented developers taking flight: Take-Two is under offer (from EA) while Vivendi is carving out its games division to merge it with Activision.

Better margins should follow from consolidation and a more consistent supply of consoles. But the best opportunity for transforming returns may be to sell out to seasoned media companies such as News Corp and Time Warner, where gaming exposures are embryonic. Sales for GTA IV should top $1bn in the US; the biggest movie ever, Titanic, booked $600m.