It's a dire day for Xbox players, but even more so for the affected developers. The video games industry is not in a healthy state right now.
Correct.
It is tragic for the people impacted who have some excellent games in their resumes and it is appropriate to be upset for them and us, for the followups we won't get.
Human tragedy aside, this was only to be expected.
The video game industry *is" in bad shape.
But those blaming gamepass or corprate greed or eeevile Microsoft are missing the forrest for the trees.
One more time: the entire industry is in trouble.
It's not just Embracer, or whatever they call themselves this week.
It's not just Ubisoft or Sony or EA.
Square practically gave away their western studios, WB is in chaos, smaller studios are downsizing or outright closing.
And yes, it is Microsoft too.
Three things to consider about the XBOX business:
First, game pass isn't the cause of their problems. Rather it minimizes their problem. Their subscriber base isn't growing as fast as they hoped but it isn't shrinking. As bad as things might get, that $4B a year isn't going away. Add in King and COD and that is some 80-90% of last quarters net. And more than most competitors. XBOX is not going away no matter what the ill-wishers might dream of. Not the ecosystem and not the hardware (before 2030).
Second, Microsoft is a consortium and each unit is supposed to be individually profitable. Just because Azure brings in tens of billions in profit (thank Ray Ozzie) doesn't mean the other units don't have to pull their weight. This also applies to the pieces within XBOX; Activision, Blizzard, King, Bethesda, Rare, Obsidian, etc. Yes, MS gives them plenty of autonomy and support but sooner or later they need to deliver more than good reviews. MS is still a for profit operation and the same is expected of its pieces. And, see above, the gaming world is in trouble heading into "more* trouble. Anybody who thinks this is bad wait a bit: MS tends to be proactive. If they are still battening the hatches, the storm they see is worse.
Third: from the moment MS bought ABK (a bargain deal in the long term but a short term cost center, as we just saw) and tallied up 42 named studios (and what, 60 development teams?) the one question few have asked is how are they going to schedule all the output of tbose teams? At a time when even second tier games are taking five years and $100M each, the global economy is headed into a big " contraction" to put it mildly, and the market is stagnant,how is MS going to profitably schedule 60 games over the next five to six years? One a month? The stated goal is one big game per quarter. That's 24. On top of the live service games. Even if COD stays on a yearly cadence, that leaves 18 big projects to launch. Anybody care to list them?
Something had to give.
Over at Blizzard it was the "Odyssey" team that had spent 5 years on a project and needed to start over. Not their fault but a relatively obvious place to cut back.
Arkane Austin? One of the reasons given for the REDFALL issues was that a lot of the top contributors to PREY and DISHONORED were no longer there. The name and rep remained but the output? For the past year they've been repaing REDFALL and next...?
Looking at the list of studios under XBOX, BETHESDA, and ABK, what are they each working on? Which projects are too promising/advanced to kill? Which are at risk?
The word that comes to mind is "triage".
And not just at XBOX.
The human drama is awful but there is more going on than the press releases and tweets but those in the know aren't likely to dish. All we can do is speculate.
In that vein, the one studio that shocked me is Tango.
MS wants to boost their XBOX presence in Japan and cut Tango?
Definitely there must be something going on.
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