While rumors began circulating of impending layoffs at Microsoft last week, which we saw the culmination of yesterday, I wanted to wait until we knew the exact details and full breadth before typing it up. As tends to happen, speculation has run rampant and the details are often lost or incorrect when shared. With that in mind, I’ve let the dust settle so we can understand exactly what happened. Let’s get into it.
As usual, Jason Schreier at Bloomberg was one of the first reporting on the news. Perhaps one of the largest and most surprising cancellations that came out yesterday was Project Blackbird, a new, original MMO from ZeniMax-Online Studios. The game had been in development since 2018 and was previously reported to be one of the most exciting projects for Xbox coming out of the Bethesda acquisition.
Right now, it seems the fallout of this cancellation is still underway. According to Schreier, employees suddenly lost access to their internal Slack accounts before even hearing their roles had been impacted. Many employees took to social media or sites like LinkedIn to speak out about losing their jobs and how heartbroken they were. One such example is from Creative Services Manager, Landon Hood:
Most striking, 18-year veteran of the studio and ZeniMax-Online Studios President, Matt Firor, later announced he was leaving the studio.
ZeniMax-Online Studios wasn’t the only major fallout from yesterday. One of the more surprising announcements was that the long-troubled reboot of Perfect Dark was also cancelled with The Initiative studio being shutdown. Keep in mind, The Initiative was founded several years ago after the acquisition filled-2018 year at Xbox. Back in 2019, they provided a look at what makes the studio different.
Then at The Game Awards in 2020, Perfect Dark was formally announced. While it was quiet for years, last year at the Xbox Games Showcase we got the first look at Perfect Dark in motion and it received quite a lot of praise. Now, nearly 7 years later, The Initiative has been shutdown without ever releasing a single game. And let’s not forget that Crystal Dynamics was also contracted to work on Perfect Dark.
The cuts continued in other studios as well. According to those familiar, Microsoft as the parent company reduced their force by about 9,000 jobs yesterday. Estimates point to about 10% of those, around 900, impacting Microsoft’s Gaming division directly (I.E. Xbox).
- 10% of Candy Crush developer King was let-go (about 200 jobs).
- Approximately 50% of the developers on Forza Motorsport at Turn 10 studio were let-go.
- Staff at Call of Duty support studios, Raven Software, High Moon, and Sledgehammer Games, were also reportedly impacted.
- There are additional reports of developers at other internal studios being let-go as well, including Halo Studios.
- Some employees at Blizzard are being let-go though to what degree is not fully understood. Additionally, support for Warcraft Rumble is being ended.
- Staff at Rare were also impacted, though to what degree has not been detailed.
- However, long-troubled title Everwild has also been cancelled.
Everwild debuted in 2019 and had reportedly undergone some reboots internally over the past few years.
In a post from Romero Games Ltd., they announced that they have lost the publisher for their upcoming game. Given the timing of the post, it’s being assumed that this relates to Xbox Studios Publishing as well.
With reports continuing to swirl our good friend, Sam Tolbert over at Windows Central, shared the internal email sent to employees from Microsoft Gaming CEO Phil Spencer. The below is an excerpt:
It’s been a while since I’ve done a “My Take” section on an article. And I’ll certainly discuss this a lot more on this Sunday’s Bitcast. But, I wanted to at least directly comment on the above.
As someone who’s worked in major corporations for over 25 years, I’m no stranger to “reductions-in-force”, mergers, restructurings, etc. It’s the nature of the corporate environment in the United States (and other nations as well). At its core, it’s the continued result of blending a creative art form with the financial goals of corporate giants. And we’re seeing these impacts more broadly across the gaming industry over the past few years. This isn’t a Microsoft or Xbox problem. The continued focus on endlessly increasing revenue and profit margins will always prioritize spreadsheets over creativity in the end and we’ve seen countless examples of that.
It feels like the gaming industry is in a strange place. The majority of money being spent is spread across a small, sub-section of on-going games while we’ve seen major projects and new IPs either fail or never release. Meanwhile, small developers, indie labels, and “A” / “AA” work has arguably never been better.
So where does it go from here? I have no idea. All I know is: I love gaming. Like many of you reading this, gaming has done more me personally than I’ll likely ever be able to express. And continuing to see countless, amazing developers chewed up and spit out in the name of increasing endless profit margins is tiring, frustrating, and maddening.
