Gaming dev layoffs continue at Sony, EA, Supermassive, and more - The UpStream

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Gaming dev layoffs continue at Sony, EA, Supermassive, and more

posted Sunday Mar 3, 2024 by Scott Ertz

Following the massive layoffs at Microsoft and Activision, the industry has not slowed down. In fact, layoffs have sped up, rampaging the entire industry. Studios and publishers around the world have followed suit, laying off employees, closing studios, and canceling games.

Why are there massive layoffs across the industry?

Layoffs in one company can sometimes trigger a domino effect across an entire industry. This is often due to interconnectedness within the industry, where companies are linked through supply chains, partnerships, and shared markets. When one company announces layoffs, it can signal a downturn in the market or sector, leading other companies to reassess their own financial situations and workforce needs. If the initial company is a major player or trendsetter in the industry, others may follow suit in an attempt to stay competitive or to preemptively address potential financial challenges.

Moreover, layoffs in one company can impact consumer confidence and investor sentiment toward the entire industry. This can lead to reduced spending and investment, which in turn can affect the revenues and profits of other companies in the industry. As a result, these companies may also resort to layoffs as a cost-cutting measure to maintain profitability. Additionally, in industries where skills are highly specialized, layoffs in one company can flood the job market with candidates, making it harder for other companies to retain employees who may be enticed by other opportunities. This can lead to restructuring and layoffs in these companies as well.

More gaming layoffs and closures

In the case of the gaming industry, the newly merged Microsoft and Activision team is a major player, if not now the biggest player, in the space. Activision develops some of the most profitable games and Microsoft makes two major gaming platforms: Xbox and Windows. This combined group's reach made the layoffs look like a significantly bigger thing than if someone else had had a similar scale of layoffs. So, the industry takes notice and begins to follow suit, leading to a massive layoff spiral.

Sony Interactive Entertainment

Sony Interactive Entertainment has announced that it intends to lay off around 900 employees across its global gaming network. According to CEO Jim Ryan, these layoffs will not be confined to a single department, but will be spread out across the company. This includes layoffs at PlayStation's first-party studios. He said to employees,

we will enter a period of collective consultation before any final decisions are taken. All employees who are part of the collective consultation will be made aware of the next steps today.

PlayStation Studios head Hermen Hulst clarified these statements, announcing that The London studio of PlayStation would be shuttered entirely, and big studios like Firesprite, Guerrilla Games, Insomniac, and Naughty Dog would all see reductions.

Electronic Arts

EA has also announced layoffs. The company will lay off 670 positions, or about 5% of the company's workforce. In addition, the company is canceling several upcoming projects. The most high profile of which is the untitled Star Wars first-person shooter being developed by Respawn. EA Entertainment president Laura Miele said in a memo,

It's always hard to walk away from a project, and this decision is not a reflection of the team's talent, tenacity, or passion they have for the game. Giving fans the next installments of the iconic franchises they want is the definition of blockbuster storytelling and the right place to focus.

The company will shutter Ridgeline Games, the studio headed by Marcus Lehto, co-creator of Halo, who is leaving the company. Employees and projects of the studio will be folded into Ripple Effect. Support for a collection of mobile games will also be ended, including F1 Mobile Racing, MLB Tap Sports, Kim Kardashian Hollywood, and The Lord of the Rings: Heroes of Middle.

Supermassive Games

The now ironically titled Supermassive Games plans to layoff around 25% of its staff, which is around 90 people, according to reports from inside the company. The company has confirmed entering a consultation period, but has not confirmed the number of layoffs it expects. The company said on X,

We are all too aware of how unsettling and difficult this process is going to be for all our employees and will be working closely with all those involved to ensure the process is conducted as respectfully and compassionately as possible.

Deck Nine

Deck Nine, developers of Life is Strange: True Colors announced this week that they were adding to the growing list of developers laying people off. The company said on X,

Like many others in the games industry right now, Deck Nine has been affected by the game industry's worsening market conditions. Today we made the difficult decision to lay off 20% of our staff. These people are amazing, talented, and awesome developers. They have made a huge impact during their time at Deck Nine Games, and we did not take this decision lightly.


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