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38 Studios Possibly in Financial Trouble

State of Rhode Island working with the studio on solving "different issues."

Kingdoms of Amalur: Reckoning didn't exactly set the world on fire, but it wasn't bad, either.

38 Studios may be in financial trouble, according to a report out of NBC 10 in Rhode Island.

"We're always working to keep Rhode Island companies solvent, and that's what we're doing with 38 Studios," said Rhode Island Governor Lincoln Chafee to the local NBC affiliate.

The state made a $75 million loan guarantee in 2010 to initially bring 38 Studios to Rhode Island, a move now under scrutiny.

It’s only been a few months since 38 Studios released its first game, Kingdoms of Amalur: Reckoning. We’ve seen nothing of the long discussed MMO set in the same universe, codenamed Copernicus.

Chafee has not yet divulged specifics, only saying it's meeting with 38 Studios on “different issues.”

The studio has not yet responded to my request for comment.

Patrick Klepek on Google+
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Posted by patrickklepek
Kingdoms of Amalur: Reckoning didn't exactly set the world on fire, but it wasn't bad, either.

38 Studios may be in financial trouble, according to a report out of NBC 10 in Rhode Island.

"We're always working to keep Rhode Island companies solvent, and that's what we're doing with 38 Studios," said Rhode Island Governor Lincoln Chafee to the local NBC affiliate.

The state made a $75 million loan guarantee in 2010 to initially bring 38 Studios to Rhode Island, a move now under scrutiny.

It’s only been a few months since 38 Studios released its first game, Kingdoms of Amalur: Reckoning. We’ve seen nothing of the long discussed MMO set in the same universe, codenamed Copernicus.

Chafee has not yet divulged specifics, only saying it's meeting with 38 Studios on “different issues.”

The studio has not yet responded to my request for comment.

Posted by AyKay_47

sucks

Posted by Nardak

Darn...i tought the game would sell.

Posted by thedj93

hoping it worx out

Posted by Sweep

You will always have a home here with us, Rich!

Moderator
Posted by Video_Game_King

You make it sound like Rhode Island is trying to break up with 38 Studios.

Posted by nohthink

Sad... I liked the game too

Posted by mbkish

I didn't buy it because it was too close to Skyrim. I was RPGed out at that point. Maybe later this year ZI will pick it up, because now I will be playing Diablo 3.

Posted by Shaanyboi

I hope things work out. I'm really enjoying Reckoning.

Posted by pweidman

Bummer. I enjoyed the game and thought KoA:R was a helluva first effort. Hope everything works out for 38, and Rich especially.

Posted by Ghostiet

KoA's problem is that it's too dense with sidequests. Completing any makes the game too easy and there's simply too damn much of them, too close to each other. Whenever I uncovered a bit of FoW on the map, I saw tons of exclamation marks. Skyrim has a lot to do, sure, but it's not nearly as "in your face" like this.

Online
Posted by Cloudenvy

Uh oh, even though I wasn't very interested in Amalur I hope everything works out for them.

Posted by Winternet

Guess Ben Coello can't spend unlimited money sitting on the couch playing Trials.

Posted by mordukai

@Nardak said:

Darn...i tought the game would sell.

Well it sold slightly over 1 million unites. I guess it wasn't enough.

Posted by Gargantuan

I would have bought it if the combat was harder.

Posted by Overbite

More like Poor Gallup. Ba dum tsh

Posted by RockinKemosabe

Rich is the spirit guide though, he'll make it better!

Posted by Toxeia

I understand that the state of Rhode Island would want a company to move there because it would mean jobs but it doesn't seem like the kind of industry that would help the people in that state. It's a shame that they'd produce a game that was so hobbled by "innovative" combat/quest systems that suffered from the same tropes of so many games before it. Hopefully the MMO gets moving. I could see a world in the Amalur universe working very well but only in a truly open-world setting - and that's the kind of thing that might pan out for the citizens of RI.

Posted by Wampa1

@Video_Game_King: Things change, Rhode Island is thankful for the time it had with Amalur but it's time to move on.

Posted by ProjektGill

Huh, I thought Amalur sold relatively well. I guess the insane amount of talent at the studio and the years spent on the game must have cost a hell of a lot of money.

Posted by ZombiePie

The article should mention how the state loan of $75-million (60% of the state's high tech loan budget at the time) to 38 Studios came with the promise that 38 Studios would bring 450 jobs to the state by the end of 2012. The promise was nonbinding but probably set expectations for the state. Now that it is 2012 my guess is that 38 Studios is far from that promise and the state is re-examing their loan, which the studio is reliant on to keep it active. Hence the rumors of financial trouble.

Moderator
Edited by Duxa

Bummer to see a talented studio have financial issues, but the truth of the matter is that we have way too many games with too big of budgets made. I remember 10 - 20 years ago you would get 10 B games and 1 or 2 A games per year, with some odd years here and there (1998) where you would have OH MY GOD 5 AAA titles.

These less frequent titles were creative and far more memorable than today's rehashed formulaic games. An average gamer can not play more than 10 or so games a year, especially with the way games evolved. 10 years ago they were 8-12 hour experiences. Now with multiplayer and other online hooks people spend 100's if not 1000's of hours on 1 game. That leaves less time to play / buy other games.

So these days its not that the game needs to be good for the company to be profitable and the game to sell, it has to be really good, with really good marketing. The gaming scene is way too saturated to be mediocre. The industry as a whole is more dependent on marketing now than creativity.

So perhaps this here goes to show that.. yes... things are based on Metacritic (unfortunatelly).

Posted by PXAbstraction

I was under the impression that EA was pleased with how Amalur was selling. Given that 38 Studios owns the IP, I figured they would have had a bigger cut of the royalties. The AAA business model is pretty much broken at this point if everyone can be pleased with a title's sales and the developer who had probably a sweeter publishing deal that most is still barely clinging to life after receiving a huge state loan as well.

Posted by Tennmuerti

Surprise.

Edited by SlightConfuse

Well MMO are expensive. besides 38 did not work on Amalur they only publsihed it.

Posted by captain_clayman

dang, that's a bummer. amalur is actually a pretty good game. well, there's always money in the banana stand.

Posted by digitaldemigod

The thing I never understood was that they were using Reckoning to introduce players to the upcoming MMO. There are several problems there. No matter how great the backstory is, it will be yet another fantasy MMO. Reckoning already has a very similar art style to WoW. Do we really need another fantasy MMO? I think they'd be better off just making more single/co-op games as sequels to Reckoning. RI would be helping to fund a game that will not succeed, and most of those 450 jobs would be lost.

Posted by DukesT3

I think after Skyrim there was fantasy open world fatigue. Thats what my friend told me anyways, he'd buy this game but after playing the hell out of Skyrim he was burned out on that type of game.

Online
Posted by Roger_Klotz

This sucks...but, at least The Great Rich "Houdini Copperfield" Gallup can make a living off his magic tricks. That one at PAX east gave me the vapors.

Posted by ArtelinaRose

@SlightConfuse said:

Well MMO are expensive besides 38 did not work on AMalur they only publsihed it

DURRRRRRFFFFFFFFSPSSBBBTTTTT

Posted by fusrodah

I think if I had seen the Time Trotters video before Reckoning came out, I probably would've bought it. Gallup is OG.

Posted by jeffrud

@ZombiePie said:

The article should mention how the state loan of $75-million (60% of the state's high tech loan budget at the time) to 38 Studios came with the promise that 38 Studios would bring 450 jobs to the state by the end of 2012. The promise was nonbinding but probably set expectations for the state. Now that it is 2012 my guess is that 38 Studios is far from that promise and the state is re-examing their loan, which the studio is reliant on to keep it active. Hence the rumors of financial trouble.

I wish I could upvote this.

Posted by MordeaniisChaos

Did that game sell pretty well?

I mean, it was just a bunch of straight cut and pasting, but didn't it do well?

Posted by dropabombonit

Rich spent it all on getting a new series of time trotters off the ground

Edited by Daveyo520

Woooo! Local news becoming national! We gave them so much money. @ZombiePie: We did indeed do that.

Online
Posted by MrCandleguy

@SlightConfuse said:

Well MMO are expensive besides 38 did not work on AMalur they only publsihed it

Are you trolling? God i hope you are.

Posted by n8

@jeffrud said:

@ZombiePie said:

The article should mention how the state loan of $75-million (60% of the state's high tech loan budget at the time) to 38 Studios came with the promise that 38 Studios would bring 450 jobs to the state by the end of 2012. The promise was nonbinding but probably set expectations for the state. Now that it is 2012 my guess is that 38 Studios is far from that promise and the state is re-examing their loan, which the studio is reliant on to keep it active. Hence the rumors of financial trouble.

I wish I could upvote this.

Yep, lets upvote it moar.

Posted by august

I'm not sure if Reckoning doing well alone could save the compnay, seeing as how they basically bought Amalur and have been working on their own MMO with nothing to show for it for a long, long time.

Posted by WinterSnowblind

Reckoning killed any interest I had in the MMO, it was a painfully generic game, with incredibly boring lore.

Posted by Fokma

Wait... $75 million to produce one game? I know there's games like SWTOR that cost multiple times that, but I doubt even Skyrim cost that much to produce (marketing is a different bucket which developers don't handle).

Posted by jNerd

I thought Amalur would sell better then it did. I hope 38 Studios doesn't close its doors.

Posted by mccarron

@ZombiePie said:

The article should mention how the state loan of $75-million (60% of the state's high tech loan budget at the time) to 38 Studios came with the promise that 38 Studios would bring 450 jobs to the state by the end of 2012. The promise was nonbinding but probably set expectations for the state. Now that it is 2012 my guess is that 38 Studios is far from that promise and the state is re-examing their loan, which the studio is reliant on to keep it active. Hence the rumors of financial trouble.

That's what I was thinking too, this article mentions milestones that 38 must hit in order to keep good on the agreement. It also mentions that 38 didn't receive all the money up front and that'd it'd be coming in parts over the next 18 months which it sounds like we'd be close to the end of now. So sounds like deal modification going on by one or both sides.

Posted by BonOrbitz

Christ. Another day, another news story about a game studio in financial trouble. I hope 38 Studios and Rich Gallup pull through.

Posted by TehJedicake

shit.....

Posted by onan

@PXAbstraction said:

I was under the impression that EA was pleased with how Amalur was selling. Given that 38 Studios owns the IP, I figured they would have had a bigger cut of the royalties. The AAA business model is pretty much broken at this point if everyone can be pleased with a title's sales and the developer who had probably a sweeter publishing deal that most is still barely clinging to life after receiving a huge state loan as well.

The problem is that the studio was initially focused on the MMO, and is still plugging away at it, spending millions of dollars to deliver it to a market that has no interest in paying for the client software nor a monthly fee. Reckoning was pooped out as a stopgap, a way to use some of the assets they were producing in order to earn some money in the meantime.

Blizzard put a lot of effort into WoW, Sony put a lot into Everquest, Bioware put a lot into SWTOR, but at the end of the day they made their money elsewhere and they've got fairly rich coffers that allow them that luxury. Even if they are working everyone to the bone over there at 38 Studios, this is pretty much the John Romero model of game development. 38 is treating design as law and putting everything into an all-or-nothing product from a fairly unknown studio that has no time table, no recognition, no release date, no anticipation, and almost literally banking on the belief that the world you're building is going to garner enough fans to make it perpetually profitable. That's a super dangerous place to be as a game developer.

Posted by Nautilus1515

@captain_clayman said:

dang, that's a bummer. amalur is actually a pretty good game. well, there's always money in the banana stand.

You sir are correct.

Posted by megalowho

Hard for me to feel too much sympathy for a studio that has yet to produce a game, as KoA was pretty much Big Head Studios' baby start to finish. If you want to keep a game development company solvent, at some point you actually have to sell something, let alone announce it. Hope there's some news in the pipeline for what we can expect from that MMO.

Posted by spartanlolz92

they need to cancel that mmo the market is way to crowded

and make a sequel to amalur it was a good game just needs some polish

Posted by ZOnikJJ

That's kind of a bummer.

Posted by hawkinson76

@Nardak said:

Darn...i tought the game would sell.

Did you buy it? I didn't.

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