What you need to know
- Microsoft Gaming recently opted to close three studios under ZeniMax Media: Alpha Dog Games, Arkane Austin, and Tango Gameworks.
- According to a report from Bloomberg, the news came as a shock, with Tango Gameworks being in the process of pitching a sequel to its 2023 hit game, Hi-Fi Rush.
- Arkane Austin was also reportedly looking to pitch a new game that would've hearkened back to the studio's immersive sim roots.
It's been a rough news cycle for Microsoft Gaming, and things are looking even rougher.
A report from Bloomberg on Wednesday touched on some of the ostensible reasons Microsoft decided to close three ZeniMax Media studios. The move — which saw the closure of Alpha Dog Games, Arkane Austin, and Tango Gameworks — was reportedly a shock to employees.
Tango Gameworks was reportedly pitching a sequel to Hi-Fi Rush, a surprise critical hit that launched in January 2023 across Xbox Series X|S and Windows PC, with a PlayStation 5 port being released in March 2024. Meanwhile, Arkane Austin was also looking to pitch a new game that went back to the studio's roots of immersive sims, such as a new entry in the Dishonored franchise, it's claimed.
Speaking in a town hall, Microsoft Gaming president of game content and studios Matt Booty reportedly told ZeniMax Media employees that the cuts (which might not be over) came down to the division's leadership feeling too stretched and was a move meant to put more resources in bigger franchises. Both Arkane Austin and Tango Gameworks were looking to hire additional staff in order to work on new projects.
Microsoft brought in $27.6 billion in operating income last quarter, beating expectations. Xbox revenue was up 51% year-over-year, thanks to the addition of Activision Blizzard.
ZeniMax and Bethesda are now geared towards large franchises
The remaining teams at ZeniMax Media include Arkane Lyon, Bethesda Game Studios, Id Software, MachineGames, and ZeniMax Online Studios. Broadly speaking, these studios are geared to continue working on larger games than the games developed by the now-defunct teams.
This includes Marvel's Blade, the Elder Scrolls and Fallout franchises, new updates and DLC for Starfield, and Indiana Jones and the Great Circle.
Analysis: We've lost the plot
I find myself baffled at these recent events. Certainly, I understand that not all companies subscribe to the same mentality I do, in which leadership should be first to fall on their swords when things don't work out, that you protect the people working for you so they can deliver their best work. Layoffs can sometimes be expected because things don't work out. It's unfortunate, but it's been a part of the gaming industry for a while.
This...surpasses that. It's short-sighted self-destruction. It's like having one leg blown off and thinking you need to even yourself out by shooting off the other leg as well. The gaming industry is a unique intersection of art and tech, and it has rewarded institutional knowledge for decades.
Cultural cachet and ideas of consumer-friendliness are often misread on social media or wildly misunderstood by even experts, but they remain important and they cannot be quantified by data. Hi-Fi Rush was the most well-received new IP at Xbox in a long time, with wide praise in reviews and awards.
If the central ZeniMax and Betheda teams needed more support for that first-party division to grow, they should've grown, not been cut down even further. What Microsoft would've paid to support a sequel at Tango Gameworks (as well as a new Dishonored at Arkane Austin) would've been worthwhile simply in consumer and developer goodwill.
My colleagues have collated the thoughts of industry veterans on the situation, as well as pointed out how disappointing this is overall. It'll be worth repeating for years to come: This was a mistake and the leadership at Microsoft Gaming will live to regret it.
