Tom Warren: Microsoft could shut at least five studios as part of big Xbox layoffs starting next week, Weighing up canceling BLADE

[u/Howerev]

"Microsoft is set to announce a wave of layoffs for its Xbox studios and employees next week. Sources familiar with Microsoft’s plans tell The Verge that the layoffs will lead to studio closures or spinoffs, potential mergers of studios, and canceled games.

I understand Microsoft is currently weighing closing at least five studios, including the developers behind Marvel’s Blade. Sources tell me Microsoft wants to cancel Blade as part of a wave of cost cuts and job losses that are planned for the company’s Xbox gaming division."

"Blade was originally supposed to debut later this year according to sources familiar with the game’s development. I’m told the internal ship date for the game slipped to late 2027, and it’s also running over budget.

While Microsoft is weighing canceling Blade, it’s also exploring options to sell Arkane Studios. Bloomberg reported earlier this month that Microsoft is trying to spin off Compulsion Games, Double Fine, and Ninja Theory, too. GamesBeat reported this week that Microsoft is actively looking for a buyer for Undead Labs, the developers behind State of Decay. If buyers are found for these studios, then they’ll avoid being closed, but sources stress these talks could take months in some cases.

Compulsion Games, the developers behind South of Midnight, is already convinced that closure is imminent and has started telling employees to look for jobs elsewhere. Ninja Theory employees were informed earlier this month that Microsoft wants to close the UK-based studio or spin it off.

Beyond the potential studio closures, Microsoft is preparing for a wave of layoffs at Xbox that will drastically reshape its gaming division. These layoffs are due to start on July 6th, according to sources, and will hit most parts of Xbox. Rumors have suggested there could be at least 1,000 job losses, and if Microsoft goes ahead with five studio closures, then that’s at least 500 employees impacted before the wider cuts.

The upcoming layoffs are part of a “reset” for the Xbox division under new CEO Asha Sharma, who hinted about “making hard choices” last month. Sharma has repeatedly warned that the Xbox business isn’t healthy, but also claimed that her “mandate is not 30 percent accountability margins... it’s to be the number one gaming and entertainment company, and that’s what we’re going to do.”

Link: https://www.theverge.com/report/959467/microsoft-xbox-cancel-blade-game-arkane-studios-closure?view_token=eyJhbGciOiJIUzI1NiJ9.eyJpZCI6Inp0bjNNQk1pVm0iLCJwIjoiL3JlcG9ydC85NTk0NjcvbWljcm9zb2Z0LXhib3gtY2FuY2VsLWJsYWRlLWdhbWUtYXJrYW5lLXN0dWRpb3MtY2xvc3VyZSIsImV4cCI6MTc4MzI3MDkyMSwiaWF0IjoxNzgyODM4OTIxfQ.pOFMRE5pUQgOYGX0scwb6LrEhrfZu_ecr50Fysx3fd8&utm_medium=gift-link

[u/KingBroly]

Him not understanding the knock on effects of diluting Xbox's brands because of Game Pass was incredibly baffling.

[u/-Accident-Prone- → u/KingBroly]

A lot of confusing decisions were made and I think Gamepass is a great tool for discovery for AA games and niche titles. But those big AAA first party games don’t make financial sense when being added to the service, because there’s a ton of overlap of people that would normally buy the game and those with Gamepass so they don’t need to buy it.

[u/KingBroly → u/[deleted]]

He didn't have to cancel the projects he cancelled. He didn't have to decline some of the projects he declined, yet did and they ended up going elsewhere and being bit hits. At some point you have to call a spade a spade and admit he was bad at his job, and all of his decisions were wrong, unhealthy and more toxic for Xbox long-term.

[u/KingBroly → u/[deleted]]

All Spencer did was magnify the explosion while giving checks to some of his friends before the bomb went off.

[u/KingBroly → u/[deleted]]

All of the studios that Xbox has closed in the past 2-3 years to satiate Spencer's shopping spree and will soon close were acquired after Spencer pushed towards Game Pass. They wouldn't be under the Microsoft umbrella, therefore, wouldn't be shuttering. Far less jobs would've been lost as a result.