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Report: 38 Studios Lays Off Entire Staff [UPDATED]

Both 38 Studios and Big Huge Games have been effectively dismantled.

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UPDATE 3: According to Chafee, 38 Studios took a turn for the worse due to poor sales of Kingdoms of Amalur: Reckoning.

“The game failed," said Chafee.

38 Studios founder Curt Schilling announced on Twitter yesterday that Reckoning sold 1.2 million copies. Chafee said the game needed to sell closer to three million.

The state also just published a bunch of documents related to its loan.

--

UPDATE 2: A press conference with Rhode Island governor Lincoln Chafee is happening now.

“It’s not a good situation,” he said. “I’m not here to share good news. I wish things were different.”

Chafee said there were discussions between 38 Studios and the state about giving more taxpayer money to the developer, but the state declined.

“I would gladly extend the life of the company if I had confidence it would lead to profitably,” said Chafee. “We were not given that confidence.”

When the state was talking to 38 Studios, there was no mention of layoffs. In the press conference, the state has not acknowledged whether there have been mass layoffs, which appears to be the case.

The state is unaware whether 38 Studios will file for bankruptcy.

--

UPDATE: According to WPRI, here's the email that was sent to 38 Studios employees today:

The Company is experiencing an economic downturn. To avoid further losses and possibility of retrenchment, the Company has decided that a companywide lay off is absolutely necessary.

These layoffs are non-voluntary and non-disciplinary.

This is your official notice of lay off, effective today, Thursday, May 24th, 2012.

--

Both Polygon and Joystiq are reporting based on sources familiar with the situation that 38 Studios has laid off its entire staff. This includes both the main 38 Studios office, as well as all employees at Big Huge Games, which 38 Studios owned.

Rhode Island governor Lincoln Chafee had commented as recently as yesterday that all attempts were being made to rescue the studio from closure. He also stated that 38 had yet to find additional outside funding. Reports coming from inside the studio stated that employees had not been paid since May 1, and that all employee health benefits ran out as of today.

Details on this situation are still being investigated. We'll update this story as soon as we know more.

Alex Navarro on Google+

677 Comments

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warchief

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Edited By warchief

@Styl3s said:

@forkboy said:

Really terrible for the employees, I hope they are able to land on their feet in other roles soon. It's a shitty time to be unemployed.

Is there a good time to be unemployed?

In this instance yes, because at least then they are guarantied a "paychek".

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Foggen

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Edited By Foggen

Time to look at that fat CBS budget and help a motherfucker out.

Also: way to drag down BIg Huge. It's not like Rise of Nations was an unsurpassed revelation in the civilization RTS genre or anything. Oh wait, that's exactly what it was.

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MakoTitan

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Edited By MakoTitan

And I know that Giantbomb can't go hiring anyone who is a friend that loses a job, but this isn't just anyone, its Rich Gallup!!! Let's go full circle and have him return to GB, just after they move in with GameSpot! It's a dream I would love to see come true.

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AmethystRush

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Edited By AmethystRush

I really wanted to see what their crazy MMO was all about. This really sucks. Though secretly I am excited that maybe the legendary Rich Gallup would like to work for Giantbomb.com a website about video games.

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napalm

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Edited By napalm

@freakin9 said:

The saddest part is no one really cares that this MMO isn't going to come out.

Nah.

Also, turn off the caps.

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Mumrik

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Edited By Mumrik

So, what didn't go as planned?

Were they off schedule on the MMO, did Reckoning tank, or did they just have no idea how much money they were spending?

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MC_Hify

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Edited By MC_Hify

@Excast said:

I like how Curt Schilling was linking to his own forums just 3 hours ago and hyping an MMO that is now effectively dead. And the most hilarious part is that this guy is a huge Republican who is supposedly for lower taxes and personal responsibility, yet his company is now going belly up only a few months after they released their first game...with tens of millions owed to the state of Rhode Island.

I disagree. The most hilarious part is the fact that he used the money Rhode Island loaned him to pay back his own 4 million dollar investment in his company. This means he personally loses nothing thanks to the state of Rhode Island.

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chiablo

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Edited By chiablo

@Foggen: I would LOVE a Rise of Nations sequel. That's probably the game I played the most of with friends. Holding the world hostage in a multiplayer game with 20 nuke silos is probably the highlight of my gaming career.

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benu302000

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Edited By benu302000

FUCKING. CALLED IT.

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Enigma777

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Edited By Enigma777

Ouch.

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warchief

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Edited By warchief

@Mumrik said:

So, what didn't go as planned?

Were they off schedule on the MMO, did Reckoning tank, or did they just have no idea how much money they were spending?

they were spending close to 4mil a month without a revenue stream...

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excast

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Edited By excast
@runcrash said:

@Excast said:

I like how Curt Schilling was linking to his own forums just 3 hours ago and hyping an MMO that is now effectively dead. And the most hilarious part is that this guy is a huge Republican who is supposedly for lower taxes and personal responsibility, yet his company is now going belly up only a few months after they released their first game...with tens of millions owed to the state of Rhode Island.

I disagree. The most hilarious part is the fact that he used the money Rhode Island loaned him to pay back his own 4 million dollar investment in his company. This means he personally loses nothing thanks to the state of Rhode Island.

This is really disgusting on so many different levels.  The guy made tens of millions as a baseball player, yet he is lining his own pockets while his staff goes without a paycheck?
 
What a scumbag.
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viking_funeral

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Edited By viking_funeral

0 to 100 comments in 25 minutes. Not bad, but not in the top 10.

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VarkhanMB

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Edited By VarkhanMB

Didn't really care for the MMO, but that's a fucking bummer for all these good people... (and Rich!)

Return of the rich to work with the GB staff? Yes please?

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andrew2696

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Edited By andrew2696

@benu302000: What a depressing thing to call.

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mesoian

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Edited By mesoian

@Mumrik said:

So, what didn't go as planned?

Were they off schedule on the MMO, did Reckoning tank, or did they just have no idea how much money they were spending?

Yes.

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DJ_EuroGhost

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Edited By DJ_EuroGhost

@Dyram: The market will take care of them (also, giving somebody huge sacks of cash with no risk attached leads to...this I guess)

also, also: WE LOVE YOU RICH!

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MC_Hify

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Edited By MC_Hify

@Dallas_Raines said:

I wonder who's gonna try to buy that IP from Rhode Island.

The IP isn't really worth anything I'll bet. There's probably a ton of assets they could sell off to an Asian MMO developer though.

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zombie2011

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Edited By zombie2011

Holy shit! This is surprising it's happening so quickly

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freakin9

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Edited By freakin9

@Napalm said:

@freakin9 said:

The saddest part is no one really cares that this MMO isn't going to come out.

Nah.

Also, turn off the caps.

Sorry about the four letters that were in caps. I'll refrain from leaning so hard on the shift key next time.

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71Ranchero

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Edited By 71Ranchero

So many people that have no idea what they are talking about in these threads.

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zyn

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Edited By zyn

Wow...

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Max_Cherry

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Edited By Max_Cherry

@benu302000 said:

FUCKING. CALLED IT.

You were the only one, too.

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napalm

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Edited By napalm

@freakin9 said:

@Napalm said:

@freakin9 said:

The saddest part is no one really cares that this MMO isn't going to come out.

Nah.

Also, turn off the caps.

Sorry about the four letters that were in caps. I'll refrain from leaning so hard on the shift key next time.

You got me. I meant bolding. Eh, whatever.

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Monkeyman04

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Edited By Monkeyman04

Man, they just showed off the landscape of the MMO. Looks like that's not happening any time soon. I feel bad for all that lost their jobs.

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TheHT

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Edited By TheHT

Holy shit. For some reason I thought this whole fucked up situation would work itself out in the end. I guess it did but, it's still a bummer.

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fargofallout

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Edited By fargofallout

So, if I were to buy Amalur right now, who would get the developer's cut? Would it all go to EA as the publisher?

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sixpin

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Edited By sixpin

@Atramentous said:

So many people that have no idea what they are talking about in these threads.

This.

Also, as someone who has been on the short end of a failed startup company; my deepest sympathies go our to these guys. I hope the talented folks who lost their jobs land on their feet quickly. Nice to see all of the support pouring out over Twitter right now.

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Csaint

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Edited By Csaint

WE WANT RICH! WE WANT RICH! WE WANT RI

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veektarius

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Edited By veektarius

@Jason_Bourne: Then I guess it must have just been really poorly managed.

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8BitAvrin

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Edited By 8BitAvrin

@Jason_Bourne: Yea that's true. I thought they were a smaller studio, but yea an MMO is the most expensive type of game to create. I wonder how far along they were on it.

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Dreamfall31

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Edited By Dreamfall31
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Looks like Rich will have to go back to his old job!!!

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viking

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Edited By viking

@Jace said:

CBS, please go grab Rich. GB needs a decent east coast correspondent. Most of the GB community already loves the guy, he would be a great fit.

I agree. GiantBomb needs 2 east coast correspondents that balances each other out! Rich seems like a really good and positive guy and Alex is like....... dark... cynical… pretty much the devil himself. And If you combine them both. RICH = THE LIGHT SIDE. ALEX = THE DARK SIDE. Then you will have a team of east coast correspondents that brings balance to the Force. Ying-yang. La vida loca. Etc. = And in the end = World peace.

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theveej

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Edited By theveej

Man that sucks for the folks at 38 studios, wish them all the best of luck, hopefully most of them can get back on their feet soon.

Dunno if Rich would want to comeback to video game websites and what not, I believe he left Gamespot to move back to Boston so I dunno. It would be cool to see him back with the crew, but whatever happens hopefully its for the best.

Big Huge games made some amazing games, so hopefully they survive this somehow.

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Roger_Klotz

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Edited By Roger_Klotz

This sucks, I feel bad for Rich.

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RoyCampbell

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Edited By RoyCampbell

A lot of disrespect for Gallup (and the people that worked there) in here; he and many other people are currently in a gigantic mess and all you have to think about is "time to go back to your old job!"

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bcjohnnie

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Edited By bcjohnnie

@fargofallout: 38 studios would of course get that cut, they still exist as a company, just with no employees. Basically all the money they make from sales of the game now will have to go to winding down business, paying off the state, and hopefully paying the rest of what they owe their employees.

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deactivated-5a1a3d3c6820c

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Meh, no big loss.

The industry doesn't need people making more generic fantasy RPGs and MMOs.

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excast

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Edited By excast

Yeah, the people we should really feel for are the employees that were a part of this catastrophe, especially the folks at Big Huge Games who were dragged into a situation totally out of their control.

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zaccheus

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Edited By zaccheus

Pretty sad. No interest in the MMO, but Big Huge could have made something awesome in the future.

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RoyCampbell

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Edited By RoyCampbell
@Khann said:

Meh, no big loss.

From the outside looking in, that seems like the easiest thing you could say.
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RedRoach

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Edited By RedRoach

@8BitAvrin said:

@Jason_Bourne: Yea that's true. I thought they were a smaller studio, but yea an MMO is the most expensive type of game to create. I wonder how far along they were on it.

no, that studio is easily 3x the size of the average. They've been open since 2006. in 6 years a massive development team managed to put nothing out. It sucks because this all happened because of a few poor decisions. A brand new developer that A. is just learning how to work together and B. has no money should not make an MMO. They should've put out 3 or 4 good games first. Learn how to work as a team and, come up with a dev process, as well as build up a nice chunk of money, and pay off that loan before trying to undertake such a MASSIVE project.

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renmckormack

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Edited By renmckormack

@Dallas_Raines said:

I wonder who's gonna try to buy that IP from Rhode Island.

This is actually interesting.

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fusrodah

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Edited By fusrodah

I hadn't realized Big Huge was part of 38 Studios...Rise of Nations was one of my favorite games ever. I feel really guilty for not buying Amalur now.

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randomatom

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Edited By randomatom

Too close to the brink after all?

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Silver-Streak

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Edited By Silver-Streak

Well, that sucks. While it didn't light the world on fire, I enjoyed KoA, and was looking forward to the MMO to see what they did.

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Scodiac

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Edited By Scodiac

Totally shitty.

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superfriend

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Edited By superfriend

Ah man that´s so sad. I hope whatever has been in development will be released in some form. Would hate to see all that work going to waste.

I hope the guys and gals are going to find someplace nice to work.

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SomeJerk

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Edited By SomeJerk

Pouring a 40 for Pitchblack Games, pouring a 40 for 38 Studios, two sad months in a row..

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slax

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Edited By slax

I forgot all about Rise of Nations. That game was fantastic.

This is too bad. Whether you liked their game, or agree with how the company is run, it always sucks when people lose jobs.