Microsoft shuts down Arkane Austin and Tango Gameworks as part of "devestating" Bethesda cuts

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bigsocrates

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#1 bigsocrates  Online

There's just nothing left to say.

In an email to staff sent by Matt Booty, head of Xbox Game Studios, Microsoft blamed the cuts on a “reprioritization of titles and resources”. The email, verified by IGN, is below:

Today I’m sharing changes we are making to our Bethesda and ZeniMax teams. These changes are grounded in prioritizing high-impact titles and further investing in Bethesda’s portfolio of blockbuster games and beloved worlds which you have nurtured over many decades.
To double down on these franchises and invest to build new ones requires us to look across the business to identify the opportunities that are best positioned for success. This reprioritization of titles and resources means a few teams will be realigned to others and that some of our colleagues will be leaving us.
Here are the changes going into effect:
Arkane Austin – This studio will close with some members of the team joining other studios to work on projects across Bethesda. Arkane Austin has a history of making impactful and innovative games and it is a pedigree that everyone should be proud of. Redfall’s previous update will be its last as we end all development on the game. The game and its servers will remain online for players to enjoy and we will provide make-good offers to players who purchased the Hero DLC.
Alpha Dog Studios – This studio will also close. We appreciate the team’s creativity in bringing Doom to new players. Mighty Doom will be sunset on August 7 and we will be turning off the ability for players to make any purchases in the game.
Tango Gameworks – Tango Gameworks will also close. We are thankful for their contributions to Bethesda and players around the world. Hi-Fi Rush will continue to be available to players on the platforms it is today.
Roundhouse Games – The team at Roundhouse Games will be joining ZeniMax Online Studios (ZOS). Roundhouse has played a key role in many of our recent game launches and bringing them into ZOS to work on The Elder Scrolls Online will mean we can do even more to grow the world that millions of players call home.
With this consolidation of our Bethesda studio teams, so that we can invest more deeply in our portfolio of games and new IP, a small number of roles across select Bethesda publishing and corporate teams will also be eliminated.
Those whose roles will be impacted will be notified today, and we ask that you please treat your departing colleagues with respect and compassion. We will provide our full support to those who are impacted in today’s notifications and through their transitions, including severance benefits informed by local laws.
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.
Bethesda remains one of the key pillars of Xbox with a strong portfolio of amazing games and thriving communities. As we look to the future, there is an impressive line-up of games on the horizon. In 2024 alone we have Starfield Shattered Space, Fallout 76 Skyline Valley, Indiana Jones and The Great Circle, and The Elder Scrolls Online’s Golden Road. As we align our plans and resources to best set ourselves up for success in this complex and changing industry, our teams across Arkane Lyon, Bethesda Game Studios, id Software, MachineGames, ZeniMax Online Studios and the Bethesda publishing and corporate teams will be well-positioned to build new IP, explore new game concepts, and expand on our existing franchises.
- Matt

This is a further bloodbath at Microsoft and the fact that the Hi-Fi Rush team, makers of the biggest critical hit Microsoft has put out since Forza Horizon 5, got slashed shows that nobody is safe. The industry continues to shed talent in pursuit of...whatever it is the bigwigs are pursuing.

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AV_Gamer

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It seems like the lesson with all of this, is these developers quick to cash out to big time publishers don't seem to work out in the long run. One of the go to examples of course is Bioware and how awesome they were before they joined EA. Of course, developers want to make money so, it's clear why they do it. But once the big corporations take over, the heart and soul of something tends to get lost in the process. This is with all most everything, not just video games. And once the big wigs own something, they can trash it whenever they feel like it.

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bigsocrates

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#3 bigsocrates  Online

@av_gamer: A couple things. The first is that Bethesda was already huge before Microsoft bought them, unless you're talking about Arkane, which has been owned by Bethesda for most of its existence, or Tango, which was bought soon after it was founded because it ran out of money and would have had to close otherwise. I don't really think that the lesson here is "don't get acquired by big companies" because Bethesda was a big company already. And smaller companies have not been spared the bloodletting in the industry. Developers are just at the whim of their employers like everyone else, and whether you start working for a huge company like Bethesda or you join Shinji Mikami in his small start up, which he had to sell to keep the lights on, you're likely to get caught up in the machine. And even if you don't you can easily get laid off from small companies, which capsize constantly (as Tango almost did.)

The second question is "work out for whom?" It generally worked out well for the people who actually made the decisions to sell the companies. If Bethesda closed tomorrow Todd Howard would still be incredibly rich off the sale.

I think the real lesson here, beyond Microsoft being totally heartless, which we've known, is where the industry is going, and it makes me sad. I'm probably going to write a whole post about it at some point soon. Suffice it to say that Microsoft is not the first company to close its smaller studios to focus on "impactful games" in recent days.

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@bigsocrates: Yeah, I mostly agree. It just sucks all around.

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ALLTheDinos

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If anything pushes me out of this hobby, it will be the absolutely psychotic ways that business treats the people who make games. The concerns of investors and the growth of a huge corporation matter less than nothing to me. Fuck all these fucking people.

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ThePanzini

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#6  Edited By ThePanzini

If MS has can't keep Tango a relatively small studio that produces critical darlings but not necessarily hits, it kinda makes you worried about Double Fine & Ninja Theory etc, especially as Game Pass was talked as a remedy for stuff like this.

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chamurai

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I'm absolutely stunned that Tango got shut down despite what it did last year.

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"Those whose roles will be impacted will be notified today, and we ask that you please treat your departing colleagues with respect and compassion."

"These changes are grounded in prioritizing high-impact titles and further investing in Bethesda’s portfolio of blockbuster games"

Two directly conflicting statements.

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Hairyreddog

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Terrible. I think there is most definitely talent worth keeping at these studios. I understand that MS can't keep bleeding money to keep studios around if they aren't producing either money or good will... but Tango and Arkane certainly provided good will with gamers even if their games didn't sell particularly well. Hi-Fi rush wasn't my cup of tea but if showed some real talent. Redfall was terrible but Prey was beloved. They CAN make good games. BGS hasn't made a decent game since Fallout 4. Not saying they should cull that studio but to me Starfield was a HUGE misfire for them as was Fallout 76. Thats two big misses in a row. I dunno... all I'm saying is I would think MS would invest in the talent in these studios even in times when their output is low. There is talent there worth investing in, IMO. Bad, Microsoft, Bad.

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mach_go_go_go

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#10  Edited By mach_go_go_go
@thepanzini said:

If MS has can't keep Tango a relatively small studio that produces critical darlings but not necessarily hits, it kinda makes you worried about Double Fine & Ninja Theory etc, especially as Game Pass was talked as a remedy for stuff like this.

I'm not 'kinda' worried about Double Fine. I'm immensely worried.

Like... what the fuck is even happening? Am I not buying enough games? Am I not playing enough of the games I buy? Should I have spent a few bucks on loot-boxes last night instead of playing Dragon Age Inquisition? Surely there are some stakeholders out there who are like "Yo, you spent all that money, my money, to acquire these studios, and now you're going door to door, excising them like that internet meme? What the fuck did I even pay for"

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ThePanzini

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#11  Edited By ThePanzini

@hairyreddog: Starfield underperforming will still sell 3-5m copies and recoup most of its development budget back, its very rare for a AAA title to outright bomb.

Even if Hi-Fi Rush is a hit it could take a year to make any money, its much harder for the smaller games to stand out and succeed, unless you get super lucky like Helldivers 2 & Palworld.

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cikame

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I remember when making good games was how studios were able to keep going for a long time, now it doesn't seem to matter if you make a good game or not you'll be fired and shut down anyway, what is this industry.

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bigsocrates

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#13  Edited By bigsocrates  Online

@brian_: I actually think that there's not a conflict there because not every game is intended to be a blockbuster. I don't think anyone working on Pentiment thought it was going to be a Starfield level release. But this was done pretty disrespectfully.

Also buy the brand new controller color from Microsoft!

@mach_go_go_go: It's obviously nothing YOU'RE doing, but it's pretty obvious (not just from MS) that people are not buying enough smaller games or playing enough via subscription for the big companies to want to stay in that business.

As for the Shareholders of Microsoft...they don't care. Microsoft buys and shuts down companies all the time. All the big tech companies do. In this case Microsoft bought Bethesda to get Elder Scrolls and Fallout (and Fallout's hot right now) and the rest of the company, well, shed the less profitable parts like a spoiled kid throwing out the colors of Skittles he doesn't like because he knows mom will buy him a new bag if he wants more of the ones he likes.

The truth is that Microsoft shareholders are focused on "AI" right now and not even paying attention to gaming except in how it impacts the quarterly statements. That's part of how these megacorps operates. To us $7.5 billion for Bethesda is enormous money, and to Microsoft shareholders it's barely even noticeable.

And everyone who loves Double Fine should be very, very, worried. What are they even making these days?

Can they do Call of Duty support?

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brian_

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@bigsocrates: I wasn't referring to the use of the term "blockbuster". I meant the more general notion of tossing people away to boost your portfolio.

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Didn't Hi-Fi Rush do fairly well? It was a big enough hit that they spent the resources to have it ported to other platforms. It was a big focus in their Game Pass marketing since release. This is so stupid.

Like what do Microsoft actually want from their games now? They need games for Game Pass so they buy studios to make those games, the studios make the games, the games end up being well received, but then Microsoft shuts the studios down anyway. It makes no sense.

But this also is a general issue for Microsoft. The company has no actual direction anymore beyond """AI""" (which, the AI bubble seems like it is going to pop soon. The hype cycle for AI has hit the point where people are already acknowledging that it isn't what they thought and is kinda useless outside of specific uses) and sentiment towards Microsoft, especially outside of the games space, is becoming extremely negative. They are pushing hard with the "extraction" phase of enshittification on many of their products and services, especially Windows 11. They're about to add even more ads to the OS in the next update on top of the many ads and pre-installed apps that already are in it (you know that "Recommended" section in the new Windows 11 start menu? Several of those entries are about to be filled with apps that pay Microsoft to be put there as advertisements. That definitely won't make things confusing for less tech-savvy folks using the OS).

If anything pushes me out of this hobby, it will be the absolutely psychotic ways that business treats the people who make games. The concerns of investors and the growth of a huge corporation matter less than nothing to me. Fuck all these fucking people.

Yup. It's no coincidence to me that I've been mostly playing indies and older games the last few years. These big publishers are destroying the industry in pursuit of metrics that don't actually make any sense or matter. They're trying to treat the games industry like it's tech rather than a media industry. The increasingly small output of these major publishers is generally extremely boring and dull. It never seems like the developers are at fault either since it's obvious that they're being forced to try to make games including features that don't make sense in context to those games. It never made sense that Redfall had a GaaS component to it. It was a game that could be played entirely single player and at most it could have copied Borderlands' multiplayer setup. Same with the most recent Forza Motorsport. They ripped out everything that made the old Forza games good and replaced it with a GaaS-like content treadmill and poorly thought out car levelling mechanics that both ruined the game.

It's all so stupid and frustrating. We're watching an entire industry get ruined by a bunch of clueless business people who don't seem like they actually even care about games beyond extracting money from the people that like them. It's like when your favourite restaurant gets bought by some rich asshole who doesn't actually care about the restaurant. On the surface, everything looks the same, but the second you eat there you notice that it isn't as good anymore because the staff were forced to cut costs so said rich asshole could make a few more pennies. Sooner or later, the restaurant will go under because people will stop going to it when they have multiple disappointing meals in a row. The rich asshole guy won't suffer beyond a slight hit to his cheque book but all of the people who made that restaurant what it was in the first place will be out of the job and looking to do something else instead, hoping to shelter themselves from the whims of other rich assholes.

There's no consequences for being a shitty business person anymore. It's awful.

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Absolutely brutal. This is a murky time to be a non-mobile game developer in Japan. Kids do not give a shit about the PS5 in Japan and if they don't care about the PS5 the Xbox is getting barely a tenth of that attention over there. Nintendo partially investing in mobile games is still doing well. We tend to forget that Pokémon Go is a major money maker, though they don't fully own Pokémon. The Japanese PC Gaming market also exploded and ate the PS5's lunch.

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bigsocrates

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#17 bigsocrates  Online

@brian_: Yeah you're right about that but Matt Booty doesn't even understand why there's conflict in that.

It's just business, bruh.

@ben_h: Microsoft wants its games to make an absolute ton of money. Nobody actually knows how Hi-Fi Rush did in terms of profitability but it certainly got Microsoft positive attention in a year where most of its big releases were busts and you'd think that'd be worth something to a company trying to sell Game Pass subsciptions.

The cycle that gaming is in is very depressing. To be fair most media companies are being run like shitty tech companies these days, with every major studio putting out a bad streaming product and shows being pulled down to accelerate tax write offs (short term profits over all else.)

Something will probably rise from the ashes eventually but the current trajectory is neither sustainable nor fun.

I will say that there is an exception. Japan in general (and I am not including Sony) has been better (there's a reason that From is ascendant) but Nintendo specifically has not fallen victim to this disease.

Nintendo doesn't do mass layoffs nearly as much, continues to make complete games with a focus on player satisfaction, and keeps their teams and talent together. And the Switch was the best selling platform of the last 10 years.

But other Japanese companies have done better too. Sega did try to get into the GAAS "megagame" business but has bowed out and it's LAD games continue to sell well, as does Sonic.

I'm not saying Japanese companies haven't dabbled in the same bullshit, Square specifically seems to leap towards any horrible trend, but as a general rule this has affected the Western companies much more.

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#18  Edited By ThePanzini

@ben_h: Spencer on the multiplatform podcast said the reason for porting Hi-Fi Rush to PS5 were financial to improve the chances of it getting a sequel, which would suggest either it wasn't successful enough or not at all, per Grubbs reporting from a while back.

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AV_Gamer

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@ben_h: Yeah, this is pretty much what I was trying to say. Like I've said many times before, if it wasn't for the indie scene, gaming would be dead today.

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@ben_h: According to a story Grubb broke it performed below expectations. What those expectations were, who knows.

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@bigsocrates: Look, I'm clearly in the Bargaining stage. Sadly/Luckily, I'm not a hedge fund manager and there's no bargaining to be had here, so it looks like Depression is right around the corner.

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This just puts Spencer's spiel about taking responsibility for Redfall in a bad light. While I don't doubt his earnestness, sometimes you need to know when to shut the fuck up. Acknowledging that you as a CEO are responsible when your company does bad is fine, but that's not taking responsibility. At the end of the day your kind words don't mean shit when the people you are soothsaying are the ones getting fired.

Tango and Roll7 getting shut down within a week is rough. Those two games were used as examples of how you can still make decent budget games that have a distinct art direction and try something new. But even all the critical acclaim and awards couldn't shield them from the grim reaper and the reality of the CoDification of the AAA video game field.

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Also, yet again, I swear to God, if I see someone else share an Iwata anecdote amidst the industry layoffs, I am going to go insane. Sure, he would smile at the camera and seemed to get the industry, but he was acting IN ACCORDANCE TO NATIONWIDE regulations while operating a monolith. If he had the ability to fire people as freely as companies do in the USA and even most of Europe, he would have. You're a goddamn fool if you think Japanese corporate culture is "kinder" or less brutal or corrupt than what we experience.

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#24 bigsocrates  Online

@zombiepie: I don't know if this was directed at me and what I said about Nintendo (which was only partly about their labor practices but also about their game making practices) but I also don't think it actually matters all that much why companies do the things they do. Yes, Japanese companies are not more moral than Western counterparts and in some ways are worse (their gender stuff is often even more screwed up, which is pretty impressive when you think about how bad American companies are about gender). But Japanese labor law IS different, and that leads to different outcomes for employees. That's important. It's not because Japanese companies are inherently nicer or better (we see that with Sony, which does much of its development outside Japan and acts much more like a Western company, and with how Square Enix treats its Western subsidiaries)

At the end of the day what's important is not assigning blame, it's people being able to plan their lives without the constant fear of being fired for no reason, and there are big differences between the West and Japan there.

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mach_go_go_go

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At the end of the day what's important is not assigning blame...

I disagree.

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ZombiePie

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@bigsocrates: are you aware that the work hours for the average salaryman are insane? The expected number of hours makes American look like it has EU labour laws. Japan has a forest and a bridge notoriously known as places where burnt out businessmen wander into in order to kill themselves, I don't think that's a stunning indicator of Japanese corporate culture, even if one CEO tried to save face over ten years ago.

Likewise, there should be a level of accountability directed at Spencer. If not now, when? You can't keep moving the goal post on when he deserves scrutiny over repeat studio failures and documented project mismanagement.

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bigsocrates

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#27 bigsocrates  Online

@zombiepie: Yes I am aware that Japan's work culture is screwed up. Sakurai has been hospitalized for overwork. And he's Sakurai! It's worth noting that the games industry is notoriously bad in the West too with crunch and our own suicides. I have not seen a direct comparison between the game industries, just the economies as a whole. But also, more importantly, those issues are not specific to the Japanese GAME industry but Japanese work culture as a whole. It doesn't make the situation better for those caught in it but it makes the solutions a lot more complicated.

And of course Spencer should be blamed. I never said he shouldn't. I have no idea if this came from him or higher up, but at the end of the day intentions don't matter. He's responsible for the division and the division has gone through painful contractions under his watch. I used to be a Spencer fan and I'm not anymore. It might be time for someone new. But this probably would have happened under them too.

You can assign blame for sure, I just think it's less important than what happened. We don't know Spencer's intentions, maybe he begged for these people's jobs maybe he laughed while he signed the order to cut them, at the end of the day the lost jobs are what matter.

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#28  Edited By ThePanzini

Spencer & Xbox decision making and strategic bets have been consistently poor for nearly a decade, and we have internal emails from within Xbox own hierarchy doubting Spencers actions particularly from the CFO.

Coupled with Xbox inability to produce big titles, intentional or not Spencer has pretty much killed Xbox as we know it, and they will likely never be a force in console hardware again.

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Fucking insanity to let the Hi-Fi Rush people go, but I have every confidence if and when those people land on their feet we're going to see even cooler stuff from them. That's not in any way softening the blow for them, I know, but I can't help but see their talent and think, yeah, those people are a sure-fire bet for someone to snap them up, or as a new independent studio.

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Some of this Consolidation also comes off the back of Todd Howard coming out saying "We are trying to figure out how to produce more of the games we make". Suddenly merging another studio who were forced to continue making a game nobody had any passion left for to, again, possibly forcibly work on a franchise all because of a TV show highlighting the near 10 year gap between a relevant franchise (and only going to be even bigger by the time Fallout 5 does come out) was partially the answer his bosses came to.

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#31  Edited By Ben_H
@thepanzini said:

@ben_h: Spencer on the multiplatform podcast said the reason for porting Hi-Fi Rush to PS5 were financial to improve the chances of it getting a sequel, which would suggest either it wasn't successful enough or not at all, per Grubbs reporting from a while back.

OK sure, but that gets back to my point of what does Microsoft actually want from their games? I wouldn't be shocked if this game sold poorly because it was one of the main games they used in marketing for Game Pass last year. I would bet far more people played it on Game Pass than bought it outright. But at the same time, it makes one wonder what Microsoft expects of games like this from a sales perspective. Do they expect it to sell just as well as if it was not a Game Pass game or do they factor in that Game Pass is probably going to heavily slow the sales of many of their self-published games?

Gerstmann brought up the exact same point on his podcast today (though he was, let's say, a bit more animated about it than me). He was completely puzzled by what Microsoft was doing and now has an extremely pessimistic view of them. Like me, he couldn't figure out what Xbox's current direction is or what they expect from the games they publish. He was concerned that if their sales expectations are as out of whack as it's looking, then Ninja Theory's probably doomed too since Hellblade 2 is unlikely to be a blockbuster hit. That Indiana Jones game has big flop potential too given how few younger people care about that franchise.

Xbox has no direction and no matter how many charm offensives their leadership team go on they never actually seem to do anything to clear up the misgivings people have of them.

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AV_Gamer

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Spencer is proof how much charm and charisma can go a long way. Everyone by this point knows he is not fit for the job of running the Xbox division at Microsoft, and perhaps never was. But he comes across as a very friendly and down to earth guy, who gets the gamers, in a "one of us" kind of way. Not some sleazy guy in a three-piece suit, when in reality, he is not much different. It's served him well.

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I don't exaggerate when I say that this decision has shaken my faith in Xbox more than anything else they've done in the history of the console - more than RROD, more than the always online controversy (which I never thought was that massive a deal, to be honest), certainly more than the dumb exclusivity/third party discourse that was shitting up social media these last couple of months. I always thought that Phil Spencer et al. had a good eye for balancing business and building a creative portfolio and that he would be a great fit after the restructuring of the leadership, but ever since they changed the hierarchy to him answering directly to Satya Nadella it feels like his spine just up and fucking vanished.

Going out there and publicly committing support to teams like Tango and Arkane and then spinning on a dime is entirely out of character even compared to the executive that helped conceive of Game Pass in the first place that it makes me wonder who exactly is actually pulling the leash. It doesn't matter how Matt Booty spins it, it completely undermines any faith in Game Pass as a vehicle for first party content. This isn't even a "good guy Phil Spencer" angle - it is impossible to believe that Spencer and the others are too stupid to know how badly this reflects on other studios in the portfolio when even the critical darlings like Hi Fi Rush don't stand a fucking chance. There has to be external shareholder or accountant impetus that drives them to this level of desperation that they would gut teams like this just for the bottom line. Game Pass felt like a legitimately smart avenue for long term business growth, already profitable (despite what people who are misreading the reports keep insisting), but someone up there who wants more infinite money more faster and are unhappy with the rate of growth has gotten cold feet and are tightening the noose.

I desperately hope that Giant Bomb gets to have Phil on the couch this year to answer for his decisions, because even as a cold unfeeling corporation this shortsighted bullshit flies in the face of the demonstrated business acumen of years prior. It just reeks to me of a book-keeper with absolutely zero knowledge of how that particular sector of the industry works, looking at the numbers and going "hey this part of the balance sheet needs to be slashed". It wouldn't surprise me, but what does surprise me is that someone of the station and experience of Spencer/Booty not attempting some kind of pushback against what clearly runs counter to their objectives for diversity in content growth just months prior. Some kind of tectonic shift in strategy must be going on and it has to have run deeper than just the whole "multiplatform" thing.

Absolutely unconscionable

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Arkane is a gigantic bummer, I recently played through their whole catalogue last year, save Arx Fatalis, and it really was a great experience, I just wish it wasn’t a swan song. I know the Blade game is still happening, and there is still an Arkane studio with some of the people going over, but this doesn’t bode well.

I know it’s likely not as drastic as this, but it almost feels like video games are winding down to a tiny nub, and there just won’t be the kind of investment to keep any sort of real economy going, at least for quite some time. There will still be small passion projects, but if everything that isn’t self or crowd funded has to be a mega hit or it kills your studio, and maybe even a mega hit will kill you because it’s not a guarantee of continued investment, then what the fuck is left? There already isn’t much of a middle tier anymore. Eventually investors will get so jumpy that even low risk will still be too risky. It’s almost seems like peak video games has hit as far as investment is concerned, and it’s all diminishing returns from here as the executive suite cannibalizes their companies for person golden parachutes. There is already lots of talk about the talent drain due to the instability of working in the industry. Hell, following the industry news when I was younger made me realize I never wanted to work in games, it seems like hell. So with fewer investors, high attrition on experienced devs, a hard sell to get new deva interested in joining the mess, what the hell else is left to be created? Evony, that’s what. Match Mansion or whatever that killer grandma game was called. Tiny, terrible games that extract money from suckers and need hardly any staff to maintain.

This retraction feels worse than any other period in aware of other than the early 80s game crash. And that recovered, and this will too eventually, and there will still be creative games to some degree through it all, but I could see this becoming a generational shrinkage in the games industry, something we will be feeling for years, and will starve the market for a long time.

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ThePanzini

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#35  Edited By ThePanzini

@ben_h: Yeah, I'd say the worse aspect Xbox & MS are constantly shifting strategy seemingly to please or aline themselves with the MS mothership.

The studios acquired in 2018 were promised financial security off the back of Game Pass just had the rug pulled from under feet after the ABK deal, Xbox now wanting every game to stand on its own despite GP and the platform having virtually no software sales.

You'd like to think Xbox would get more push back on Game Pass and what exactly does success look like, people calling GP unsustainable were knocked back for years.

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Shindig

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#36  Edited By Shindig

Coming so soon after porting Hi-Fi Rush to the other platforms, I wonder if staff knew the axe was coming?

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The growing body of evidence seems to suggest that Microsoft's highest leaders felt the Xbox brand was falling victim to what has been plaguing overexpansion. Likewise, it also seems like MS CEO Nadella simply has buyer's remorse regarding the purchase of Activision:

Speaking about the closures more broadly, Booty said that the company’s studios had been spread too thin — like “peanut butter on bread” — and that leaders across the division had felt understaffed. They decided to close these studios to free up resources elsewhere, he said.

Booty added that the shutdown of subsidiary Arkane Austin, the longtime developer of games such as Prey, was not connected to the performance of its new multiplayer game, Redfall, a critical and commercial flop.

@shindig said:

Coming so soon after porting Hi-Fi Rush to the other platforms, I wonder if staff knew the axe was coming?

No, and the Forbes report paints an even more depressing picture. Arkane was in the process of building a case for an immersive sim and Tango was nearing a roadmap on a Hi-Fi Rush sequel. The projects did get presented to senior leadership, but they did not change anything as they "were years away." ZeniMax leadership sided with Microsoft because they agreed that their current structure was too cumbersome:

Jill Braff, head of ZeniMax studios, said in the town hall that she hoped the reorganization would allow the division, which also develops Fallout and Doom, to put more focus on fewer projects. “It’s hard to support nine studios all across the world with a lean central team with an ever-growing plate of things to do,” she said, according to audio of the meeting reviewed by Bloomberg.

“I think we were about to topple over,” she added.

Both Tango and Arkane released games last year and were looking to hire additional staff as they pitched new projects, which Booty and Braff suggested was the main factor behind their closures. Shinji Mikami, Tango’s founder and studio head, departed last year.

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#38  Edited By Ben_H

So basically Microsoft want to be the Netflix of games but are being too cheap to adequately support the people and studios that provide the content that is vital to their service actually working. Cool. Skimping out on hiring the extra staff necessary to keep Zenimax and the studios functioning properly was definitely worth tanking Xbox's entire reputation for. In a backwards way, they probably would have provided a lot more value to shareholders by just hiring the people Tango, Arkane, and others were asking for. Instead, Microsoft's reputation as a games publisher and service provider is in the dumps.

Every third party that Microsoft is approaching for Game Pass licensing deals should be demanding more money now for future deals. If things are as dire as it seems with Microsoft's game development and publishing pipeline, they are now going to have to rely more than ever on others signing content deals for Game Pass. They'll either have to pay up or Game Pass will lose subscribers.

It's like they've completely ignored how Netflix has grown and changed over the last 15ish years. Netflix built their gigantic content pipeline because licensing content from others was far too expensive to rely upon heavily. Microsoft looked like they were in the process of setting up a similar pipeline but now it seems like they're backing out and getting rid of everyone but those that work on the biggest things. Netflix, Amazon, and all the other streaming services crank out tons of shows and movies they know probably aren't going to be huge hits because the steady stream of new content, even if it isn't all gangbusters huge, is vital to the service continuing since it shows subscribers that there's new things to watch whenever they open the app.

Every bit of new information that comes out about this thing paints a worse and worse picture of the people in charge at both Xbox and Microsoft itself.

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I've got nothing to add except that screw everybody who's been defending consolidation under Microsoft, usually with the argument that it's good for developers who get to take more risks, and good for gamers who get to see more new IP and revived IP. How many decades of salaries could Microsoft have paid for these two studios with the 70 billion that it paid for Activision? I'm seriously concerned that the Xbox is increasingly becoming the Call of Duty console, with an occasional Halo, Gears and Forza game in the mix.

Look out for the Phil Spencer apology tour coming soon where he's going to go around gaming media telling everybody how painful this has been for him.

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@ben_h said:

Every bit of new information that comes out about this thing paints a worse and worse picture of the people in charge at both Xbox and Microsoft itself.

As Schreier put it best, the context is that Xbox was told to either prioritize games currently in development or games that would be in development in the future. They elected to protect studios that had stuff in the pipeline for the future. I'm not saying I agree with it and if anything, this shows that the people calling the shots simply do not understand how this industry works, but it is context

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#41  Edited By ThePanzini

Anyone within MGS shipping a game relatively soon is pretty much on the chopping block, and the worse part your games performance might not even matter. All because they got too big too fast, its a sad state to be in and a completely avoidable one.

Spencer went from hero to zero in record time, Xbox are speedrunning the EA meme.

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#43  Edited By AV_Gamer

Jeff Gerstmann and other gaming developers are pretty much echoing what I said in the beginning. The lesson is not to sell your developer studio to a big time publisher if you can help it. Sometimes all money isn't good money. Because like Jeff said, you can do everything right (in the case of Tango and Hi-Fi Rush) and still get screwed in the end. It's sad when everyone is now looking towards Hell Blade 2's release and how long it will take before Microsoft shuts that studio shutdown, regardless of how bad or good the game does.

And yeah, Spencer is going to come on with that "give me a break guys, gaming is hard" expression on his face, and sadly, people will once again give him a pass. It's all starting to get silly.

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#44  Edited By Manburger

What the fuck: Microsoft says it needs games like Hi-Fi Rush the day after killing its studio

Today, one day after Microsoft announced that it would shut down four of its games studios, Matt Booty, head of Xbox Game Studios, held a town hall to discuss the division’s future goals. “We need smaller games that give us prestige and awards,” Booty told employees, according to internal remarks shared with The Verge.

I mean, perfectly summarized by the headline— what can you even say at this point. Is this a bit? Are we being punk'd? Seemingly a gaggle of drunken sailors slapping away at different sides of the wheel over there.