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In a shocking move that has sent some shockwaves through the gaming industry, Microsoft has announced the closure of four Bethesda game studios. The affected developers are Arkane Austin (Redfall), Alpha Dog Studios (Mighty Doom), Tango Gameworks (Hi-Fi Rush), and Roundhouse Games.

The closures were revealed in an internal email from Matt Booty, the head of Xbox Game Studios at Microsoft. Booty cited a need to “prioritize high-impact titles and further invest in Bethesda’s portfolio of blockbuster games and beloved worlds.”

Arkane Austin Hit Hardest by Closures Among the studios impacted

Arkane Austin faced perhaps the most devastating blow. Their recently launched co-op shooter Redfall failed to meet expectations, with even Xbox chief Phil Spencer calling its release “disappointing.”

As a result of the closure, Arkane has confirmed active development on future Redfall content updates and DLC will cease immediately. While the game’s servers will remain online for now, those who purchased the hero pass or other DLC will receive “make-good offers” from Microsoft for the undelivered content.

Dinga Bakaba, co-creative director at Arkane Lyon, expressed outrage over the cuts on the social media platform X (formerly Twitter). He pleaded with executives to “take care of your artists/entertainers and help them create value for you” rather than making “our work environments darwinist jungles.”

Mobile Studio and Support Teams Also Shuttered

The other studio closures affect teams across different sectors of game development. Alpha Dog Studios, known for mobile games like the soon-to-be sunsetted Mighty Doom, is being dissolved entirely. In-game purchases have already been disabled for Mighty Doom ahead of its shutdown on August 7th.

Roundhouse Games, previously operating as support for other Bethesda teams, will merge its remaining staff into ZeniMax Online Studios to assist with The Elder Scrolls Online. Few details were provided about the closure of Tango Gameworks beyond confirming their action hit Hi-Fi Rush will remain available.

A Brutal Year for Game Industry Layoffs

These latest studio closures only add to the staggering number of layoffs and workforce reductions across gaming in 2023 and 2024 so far. Just in January, nearly 2,000 employees were let go from Activision Blizzard after Microsoft’s $68.7 billion acquisition.

By May of 2024, over 10,000 individuals had already lost their jobs as major publishers like Take-Two Interactive shuttered studios like Roll7 and Intercept Games. With a writer’s strike also currently underway in Hollywood, the hits keep coming for workers across the entertainment industry.

A Prioritization of “Blockbusters”

In announcing the difficult decisions at Bethesda, Booty stated the changes allow them “to further invest in Bethesda’s beloved worlds and blockbusters you have nurtured over decades.” He pointed to major upcoming releases like Starfield’s Shattered Space expansion and the Indiana Jones game currently in development.

However, critics argue the pursuit of blockbuster titles often comes at the expense of creativity, risk-taking, and giving unique games like Hi-Fi Rush a chance to find an audience. As one of 2023’s surprise indie hits, Hi-Fi Rush may prove surprisingly difficult to replicate under a strict “blockbuster” mandate.

The cyclical nature of the gaming industry shows no signs of ending. As some major franchises and big-budget titles double down on trying to be the next big hit, we’re also seeing an unprecedented culling of the very development talent responsible for those past successes. Where that leaves the medium’s creativity and diversity remains to be seen.

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