Nobody is safe at Xbox Game Studios as it shuts award-winning developer

  • Xbox Game Studios has shuttered Redfall developer Arkane Austin, Mighty Doom dev Alpha Dog Studios and developer of the surprise 2023 hit Hi-Fi Rush Tango Gameworks.
  • Roundhouse Games won’t be shuttering but it will be folded into The Elder Scrolls Online’s team.
  • The news comes a week after Microsoft announced revenue gains from Xbox’s digital content and services.

Layoffs have plagued the videogame industry for the last year and just as we thought it was all over, Xbox stepped in to callously shutter three Bethesda Studios.

As reported by IGN, Microsoft’s Xbox Game Studios has shut down Redfall developer Arkane Austin, Mighty Doom dev Alpha Dog Studios, and developer of the surprise 2023 hit Hi-Fi Rush, Tango Gameworks. That final name is a shocker as Hi-Fi Rush was incredibly well received, winning two awards and one would have hoped that Xbox would want to try capture lightning twice. Roundhouse Games won’t be shuttering but it will be folded into The Elder Scrolls Online’s team.

The news was shared with staffers in an email sent by head of Xbox Game Studios, Matt Booty. In that email, Booty offers up what we suppose could be called an explanation.

The Xbox head says that the firm wants to prioritise “high-impact titles” from Bethesda and ZeniMax’s teams and as such, resources need to be put into those titles. The exec mentions titles including Starfield Shattered Space, Fallout 76 Skyline Valley, Indiana Jones and The Great Circle, and The Elder Scrolls Online’s Golden Road all due for release in 2024.

“These changes are not a reflection of the creativity and skill of the talented individuals at these teams or the risks they took to try new things. I acknowledge that these changes are also disruptive to the various support teams across ZeniMax and Bethesda that bring our games to market. We are making these tough decisions to create capacity to increase investment in other parts of our portfolio and focus on our priority games,” Booty wrote.

As many have highlighted in the hours since this news broke, this is a weak explanation.

Microsoft has been hungry to add studios to its Xbox brand in a bid to compete with the likes of Nintendo and Sony in the console space. Only, that gambit has yet to pay dividends. Sony has the likes of Santa Monica Studio to create system sellers like God of War and Insomniac creating Spider-Man. Microsoft doesn’t have a studio with that sort of clout and now it seems that even award winning games like Hi-Fi Rush aren’t enough to secure your future at Xbox.

The firm also spent billions – not counting the legal fees it incurred – to acquire Activision Blizzard recently and then promptly fired 1 900 employees.

The most concerning part of all of this is that just last week, Microsoft reported that revenue from Xbox’s digital content and services grew 62 percent, slightly offsetting losses from console sales. If even helping to grow subscriptions to Game Pass isn’t enough, how can any developer feel safe at Xbox?

Studio and co-creative director at Arkane Lyon, Dinga Bakaba had choice words for the higher-ups at Xbox.

“Permission to be human : to any executive reading this, friendly reminder that video games are an entertainment/cultural industry, and your business as a corporation is to take care of your artists/entertainers and help them create value for you. Don’t throw us into gold fever gambits, don’t use us as strawmen for miscalculations/blind spots, don’t make our work environments darwinist jungles. You say we make you proud when we make a good game. Make us proud when times are tough. We know you can, we seen it before,” Bakaba posted on X.

Many more have once again asked how this reprioritisation impacts the decision-makers. While Booty highlights there may be “some” layoffs in corporate teams, he also said some dev teams would be reassigned in these layoffs and some there meant just one.

This is simply awful and not only for those who have lost their jobs. The folks who are left behind are now working under the threat of losing their jobs, even if they create a massive hit.


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