Xbox Lays Off 20% Of Staff, Cut Studios, Largely Impacting Acquired Devs It Promised It Wouldn’t Layoff

from the who-could-have-possibly-predicted? dept

The long-rumored layoffs at Xbox have come and they are massive. We just recently discussed the mess that Microsoft’s Xbox division has become. An internal email that was sent to staff by CEO Asha Sharma laid out just how bad things were, essentially preparing the staff for the forthcoming staffing cuts. Interestingly, this is the latest in a series of staff cuts, many of which have been at studios that Microsoft recently acquired and told the FTC and the courts that there wouldn’t be layoffs in order to get the acquisitions approved. Those were lies, of course, but there won’t be any punishment for those lies. Regulation is just so un-American, you know.

This round of layoffs will effect over 3,000 staff members eventually, or about a fifth of the Xbox division workforce. The appetizer this past week accounts for about half that number. Working at Xbox right now must be buckets of fun, where you get to try to perform quality work while wondering if your name is on some list somewhere. An email went around again acknowledging the layoffs, as well as several Xbox studios going independent.

This email, shared with Kotaku, says that 1,600 of those layoffs will take place today, while the rest will take place later. Compulsion Games and Double Fine will become independent studios, while Ninja Theory and Undead Labs “have entered terms to join new ownership with funding to complete and grow Senua and State of Decay 3,” though the specifics of that have not yet been disclosed. Arkane Lyon is entering legally required “consultation” in France to review its options, and its fate remains unclear.

Layoffs will also take place in varying sizes across Activision, Bethesda/ZeniMax, Blizzard, King, Mojang, and Xbox Game Studios, though Sharma stated that none of Xbox’s first-party, publicly announced games or projects are being canceled as a part of these cuts. Mojang and King will now report directly to Sharma.

Again, several of these studios experiencing layoffs were recently acquired by Microsoft and, during regulatory proceedings, Microsoft said that layoffs wouldn’t occur. And, again, there will be no consequences for these lies, other than those felt by these ex-employees who no longer have a job.

Interestingly, these layoffs came along with a message that Xbox was going to start getting real lean on where it focuses its staff and money investments, primarily into “core franchises” in the gaming space. Despite that message, we’re already hearing about how these layoffs will result in the delay of current production of games in those very core franchises.

Speaking on condition of anonymity to protect their careers, current and former staff have told me that job losses across Bethesda Game Studios locations have removed more than 50 employees, including “key, high-performing people in the trenches” building the company’s long-awaited Skyrim successor. This in turn, they say, has shattered morale, raised the risk of future development crunch, and increased the likelihood that the game’s already far-off completion date will be delayed.

If you’re interested in how Xbox management is behaving in the midst of all of this turmoil and the obviously negative emotions of the remaining employees, well, it’s been awfully fucking shitty, honestly. Several Bethesda offices saw employees setting up “Celebrations of Service” in common areas, where staff members put up pictures of and messages to ex-coworkers to show their appreciation for all they’d done. That same day Xbox HR ordered that those memorials be taken down, all under the bullshit excuse that you can’t do that sort of thing in a common area.

“Unfortunately, HR made our office manager take this down almost immediately,” posted the union account. “They said because it’s in a common area, it had to be removed. We’ve used common areas for many things as a team, including fan works, but HR seems to believe that a Celebration of Service is inappropriate.”

And, since you can’t have real American capitalism in the modern era without getting a heavy dose of irony to go along with it, Asha Sharma herself was recently named to a task for at the Federal Reserve to advise on “jobs and productivity.” This is a bit like the FDA putting Hannibal Lecter on its advisory panel for a proper nutritional diet.

“The Federal Reserve’s commitment to price stability and maximum employment is unwavering. As is our resolve to pursue our mandate with rigor,” Fed Chairman Kevin Warsh said in a press release on July 9. “The U.S. economy has changed significantly over the last generation, and never more so than right now. Each task force will carefully consider whether policymakers’ means and methods, analytical tools and policy approaches can be improved upon. I am honored that the best minds from a range of disciplines have agreed to work with us to sharpen our performance as an institution. The goal is straightforward: to ensure the Fed is best positioned to achieve our objectives in this consequential time.”

Maximum employment? What an interesting concept for someone who just instituted historic layoffs to advise on.

So, how are things going at Xbox? Pretty fucking horrible. Layoffs, tone-deaf executives, delayed games, poor morale, and a workforce living in fear that they might be next. And I just can’t help but to return the point that much of this is a result of overextending acquisitions of enormous developers and publishers in the last five years, during which the company promised this very thing would not happen.

Filed Under: asha sharma, layoffs, video games, xbox

Companies: activision blizzard, bethesda, microsoft