Source: A Total Video Games piece citing an MTV interview ... which doesn't appear to be on the MTV Web site.
The official story: Grand Theft Auto publisher Rockstar Games had not responded to requests for comment as of press time.
What we heard: When Electronic Arts bought Criterion Games in July 2004, it did more than add the Burnout extreme-racing franchise to its game garage. The Guildford, UK-based developer is also the creator of the RenderWare engine, which powers many games published by EA rivals--Games like Grand Theft Auto III, Grand Theft Auto: Vice City, and Grand Theft Auto: San Andreas. Take-Two Interactive, owner of Rockstar, must have been less than thrilled when EA bought Criterion, as the purchase meant it would have pay royalties to its archival for each GTA game sold.
Given the royalty conundrum and the desire for cutting-edge graphics, many assumed that the next GTA would be based on an all-new engine. So when word began to spread that MTV was saying GTA IV would be based on RAGE, industry watchers nodded approvingly. After all, the technology--which stands for Rockstar Advanced Game Engine--was developed in-house at Rockstar, meaning no royalty payments to third parties would be necessary. Furthermore, Rockstar Games presents Table Tennis shows that RAGE is capable of both impressive graphics and physics, two areas which drew fire from GTA detractors.
But as logical as the TVG story sounded, it could not be verified as of press time. Neither the game sections of the US nor UK MTV Web sites had any visible stories about GTA IV, and inquiries to Rockstar reps had gone unanswered as of press time.
Bogus or not bogus?: Given the positive feedback on Table Tennis and the huge potential savings, this smells legit.
http://www.gamespot.com/news/show_blog_entry.php?topic_id=24715960&sid=6152830