It is worth understanding that this is “different” than… all the other layoffs in tech at this point.
MS acquired ABK. Any acquisition almost always leads to “downsizing”. At a high level: ABK would have had their own payroll department. Now they go through MS payroll. Why do you need an entire department whose job is now superfluous? Obviously this gets a LOT more complex with developers and the like (as well as local management) but that is the mindset.
But… holy fucking shit that is a lot of people getting laid off at one of the worst times to be unemployed in “tech” in the past decade.
It is indeed a lot of people. A quick search says ABK employed 17,000 people. Laying over over 10% of your workforce is… intense, to say the least. Though, how much of that 1,900 is just from ABK is hard to say, so the percentage could be lower.
You’re right though; HR, payroll, legal, and social media/PR departments would definitely be among the first on the chopping block, depending on how much MS wants to integrate ABK into their existing departments.
Finance too. They’re almost always first from the multiple I’ve personally been through. The new owners want those hands out of the pot asap.
Yeah, I’m a bit skeptical that this is just about “downsizing” or eliminating redundant positions after the acquisition. Based on what I’ve seen on Twitter, a lot of junior, middle, and senior level positions were victims of these cuts, across a ton of different departments. Animators, artists, developers, no one was safe. Apparently like the entire Overwatch lore team was cut - you can’t tell me that team has any overlap whatsoever with any existing Microsoft employees.
That gets into the mess of what the reality of “gaming” is. Most people will acknowledge that Call of Duty and… uhm… Halo? Sure, let’s go with that. CoD and Halo compete. They are both games in a similar genre. Same with the hilarity of Horizon Zero Dawn meaning that a critically acclaimed open world game is coming out.
But the reality is that CoD and Fortnite compete with Squid Game and Reacher. Breath of the Wild competes with both Elden Ring AND The World Cup. The resource is increasingly time. When people get home from work they generally aren’t saying “I am going to play three hours of video games and it will either be Battlebit or CoD”. They are saying “I have three hours so maybe I’ll watch an episode or two of Demon Slayer or I could do my dailies in Fifa?”
And, in that regard, Overwatch is an increasingly “failed” live service game with an IP that has lots almost all of its good will. Whereas Halo… Master Chief had a sweet ass? But Overwatch DOES compete with the other big live game that MS acquired alongside them… Call of Duty. And so forth.
Its all a giant mess where labor suffers. But… yeah.
Hence why acquisitions need more scrutiny. It literally kills jobs.
In this case, it kills unproductive jobs. Payroll people are necessary but at the end of the day, they don’t produce anything you would want to buy. This means that if you keep more administrative jobds than you need, there will be fewer actuall things to go around. Hence everyone will be poorer on average (or realistically speaking, the rich will be poorer in the current system, but that is a different issue).
Anyway, keeping unproductive jobds to reduce unenployment is a dumb idea and is one of the main reason why communism sucked so much.
I have a better idea. Fire the whole payroll division and hire just one accountant. Since clearly, clearly, any number of payroll employees can sustain any company size, this is the most cost efficient way to go.
Oh you say one staff in payroll is not enough? Oh then I miss your point.
How about you take your strawman argument somewhere else? I never said you need just one. But the company clearly did not need as many, if they were able to let them go. Economy of scale I guess.
I never want to hear “job creators” as a reason for tax breaks and special treatment again.
You’re going to hear so much more of it now that we’re cranking the unemployment rate back up again.
Probably not the guys with sexual assault charges though.
It’s a good thing we didn’t raise their Taxes or Wages! Otherwise they may have fired their workers!
The industry is at its most wealthy and yet it feels like its on fire.
Yup thats capitalism. Always need to make more money than previous year, or we have a depression… Lol.
It’s all about instilling Fear, Uncertainty and Doubt to gain from it.
Right now what they are gaining are lower overhead and when they re-hire they will be paying less for the same roles.
You don’t get rich paying a ton of people 200k. You get rich not paying them. So what you are saying is actually not a contradiction!
You don’t get rich paying a ton of people 200k.
You literally do, though. Because wealth isn’t a function of the volume of currency you’ve amassed, it is the quality of goods and services that the currency can purchase. When you’ve got a ton of highly educated people working as a team to accomplish something exceptional, what you get back is far more than what you put in.
Just ask Billie Beane, a guy who is a testament to what the upper limit of $200k/player gets you in terms of a baseball team. Yeah, you can beat the average for a little while by one exceptional administrator squeezing the system on the margins. But the only way you win that final game of the season is with a budget like what the Red Soxes or the Dodgers or Astros bring to bare.
And in that triumph, you do - in fact - get rich. You fill more stadium seats. You sell more cars or phones. You build more elaborate buildings. You send people to the bottom of the sea (without them getting crushed to death) and up to the moon.
At some point, you’ve got to put forward an investment. You can’t run an advanced economy on poverty-level wages. And if you don’t have those advances in medicine and engineering and logistics and technology, what the fuck kind of rich are you?
Do you want to pay competitive salaries in Heaven or run a robber barony in Hell?
It’s a wonderful idea but it’s just not how the gaming industry is run. The gaming industry runs more like war machine production facility.
You pay some very good people lots of money to set things up, design how things are going to go, make up some prototype work. Then you set up for production, hire on tons of people to finish all the work. Once everything is up and running and all the products are out the door you cut back to a maintenance staff while you have the very well paid, highly talented core working on the next big thing. People are dying to get into the gaming industry so bad, the job pool waxes and wains in quality a little but there’s never truly a lack of new talent when you need it.
The saving grace for the industry is live cadence games. The whole subscription side of things that we don’t really want to see as gamers keep this ebb and flow of employment from happening. You stretch your production schedule out a little longer to begin with. You don’t hire up quite so heavily and then for the life of the game you keep releasing features and options, You run events to keep people subscribing.
I like the ideas you’re proposing, It just not a method that game companies are willing to try to entertain.
People are dying to get into the gaming industry so bad, the job pool waxes and wains in quality a little but there’s never truly a lack of new talent when you need it.
This tends to be a strategy that works well when you have a lot of people in the talent pool working in smaller shops and affiliated industries, as well as lots of people exiting college with an eye towards the games industry. I think that was much truer in the '00s than it is today, if for no other reason than the market for developers generally is growing tight and people going through recruitment are going to see some enormous pay-gaps between what EA wants to offer you and what - say - Exxon or JP Morgan have on the table.
Lots of people dying to get into the industry have no business being there. Lots of people managing the industry who are good at development are retiring. There’s a core of talent that isn’t getting propagated precisely because the business is so feast-or-famine. Same thing is happening in Hollywood. And at Boeing, for that matter.
The McDouglas Model of crunch-time hiring is a great way of improving your balance sheet between quarters, but a terrible way to retain institutional knowledge or cultivate industry specific talents and skills.
The saving grace for the industry is live cadence games. The whole subscription side of things that we don’t really want to see as gamers keep this ebb and flow of employment from happening.
I mean, I think there’s a business attitude that subscriptions represent a number you can give to an actuary and say “Tell me how much money I’ll have in 10 years” with reliability. By contrast, its hard to build a long term model for a business around pre-orders and the random variable of first week sales.
At the same time, its very obvious that businesses can and do run under the “release a game / get a glut of cash / finance the next game with this income” model. It just relies on a business that plans to spend cash forward rather than one in which subscriptions are just revenues used for stock buybacks and dividends to shareholders.
What we’ve seen over the last two decades is bigger firms with loose credit looking for long-term revenue streams buying up highly recognizable brands as future income streams. Then busting them out until they’re shells of their former glory, as all the money gets drained out the back door.
I don’t really want to see talented developers working for these firms. I think that’s a genuine waste. All the folks who spent years of their lives invested in Diablo 4 are - in my mind at least - talent squandered, as the game is morphed into just another DLC/microtransaction engine.
68 billion to acquire IP, but can’t afford to pay the people who make and maintain it.
They hardly maintain them anymore…
Can*
Doesn’t
1900 employees, that’s something like 10 big games that won’t be released, or we can look forward to more outages and bugs in the new releases, and slower fixing of those bugs.
Thanks Microsoft for your contribution to enshittification 🏅💩
I mean, given the quality of product they’d been churning out, I don’t know if I’m going to loose sleep knowing we won’t get another Diablo Immortal or Call of Duty: Modern Warfare III or Candy Crush Saga any time soon.
Like, if Larian or Nintendo was hemorrhaging talent, I’d be a bit more upset. But between these guys, EA, and Riot turning out flops… Idk, man. Maybe a shakeup that pulls people out of the Micro-transaction Factory isn’t the worst thing for the industry as a whole.
you seem to be blaming the workers for turning out flops but in general it’s the managements lack of planning and micromanagement that’s the general cause.
no one who’s a developer, artist, designer wants to add micro transactions, that comes from top down because it’s a revenue generator. they want to polish the games so they can be proud of the work, but are not given time.
executives are not the ones generally being let go and the ones that are will be cashing out from the acquisition. expect those IPs to get worse and have more enshittification because that’s what makes money and that’s all corpos care about.
you don’t get a larian studios from laying off talent, you get it from good management and giving your talent time to deliver.
you seem to be blaming the workers for turning out flops
I’m sorry if I came across that way. No. I firmly pin this on the dipshits in management.
That said, the worker bees of the gaming industry don’t get to decide what a future game looks like. If Microsoft wants Microtransactions, you’re making a game with Microtransactions whether that was what you wanted to be doing with your time or not.
These companies falling into disrepair and going into layoff mode means they aren’t giant magnets for development talent. In theory, that means fewer games with all the predatory DLC / casino mechanics crap. Smaller staffs mean fewer releases and less of the market clogged with this low effort drivel.
you don’t get a larian studios from laying off talent
Blizzard hemorrhaging talent has already produced a number of new studios. I’m sure Larian has potched talent from its competitors, particularly during the big '00 and '08 layoff waves.
It sucks for the industry as a whole. But getting people out of the old toxic employers and into younger and more ambitious studios is critical in revitalizing a stagnant industry.
I remember people on the Internet talking about the Microsoft Bethesda deal. I saw people saying that it’s “actually a good thing” and how Microsoft can contribute more to Bethesda and they’ll churn out better games for Xbox. Then I see shit like this and games like Starfield and understand why 99% of the people on the Internet have no fucking clue what they’re talking about.
Starfield was basically done with their release development when Microsoft aquired Bethesda
You think Microsoft is at fault for Starfield being mediocre? Okay
Okay. Well they made sure Starfield didn’t come out on the PS5, okay. and I promise you that didn’t help their numbers at all. Okay. Okay
Ya, THAT was the problem with Starfield. That is didn’t come out in the PS5…
And please read comments more carefully next time. I did not say Microsoft was ever at fault, simply that they did not contribute anything to make Starfield better before release. Delays are a thing, but nobody thought it would be worth it to delay Starfield before release. If anything I’d bet money that Microsoft pushed the release
You’re right, you didn’t say Microsoft was at fault, you just heavily implied it. Maybe you should read your own comment again?
I did. I didn’t heavily imply it. Just that Microsoft didn’t help.
You think they’re not?
When Starfield was released Bethesda was already part of Microsoft. Sure, it was mostly done but Microsoft should have realized it was a turd and either delayed the release to rebuild the game or simply cancelled it. Instead they chose to take money from their customers for a game that is clearly not worth the asking price.
