Situation Normal All Effed Up, Part Whatever

We all knew it was going to happen, right?

Well, there you go. Jason Schreier reported yesterday that XBox is going to cut 3200 jobs and either sell or divest themselves of 5 studios.

An internal email from Asha Sharma, the current CEO of XBox, outlined everything. She also said that she wants 1 billion players per day for XBox overall (this starts at the 4:58 mark in the video above). She also mentions that they want to focus their investments in XBox, which pretty much means for these bigger studios to shed projects that won't generate as much profit and eyeballs on screens. 

From what it sounds, XBox Game Studios and Zenimax will be hit hard by layoffs, and Activision Blizzard King less so but still impacted. The overall number of jobs being lost is 3200, but only 1600 right now. That translates into waves of layoffs going forward, including divestiture/sale from the studios already identified. (Apparently Arkane Studios is also targeted, but Microsoft has begun the divestiture process with the French Work Council, as they can't summarily be canned without due process.)

What does that mean for those who love the two big MMOs that these studios manage, Elder Scrolls Online and World of Warcraft? Probably job cuts and scaling back of the staffing for both teams. 

For all those expecting Classic Plus, here's hoping that these cuts don't kill it off.

I would expect, however, far more monetization of both properties to try to boost profits. So, if you've been dismayed at some of Cash Shop options from World of Warcraft, hold onto your hat. You ain't seen nothing yet.

There will be a lot more integration of these various game studios with the Microsoft parent organization, so that Zenimax or Activision/Blizzard or King (it's marked separately from A-B in the email) will lose a lot of their independence and corporate culture. Will that impact the end product? Yes, it will; you don't change corporate culture without changing the product itself. Hell, this happens all the time in Corporate America: the old enshittification process writ large. The back office jobs, or those not labelled "critical" to a game studio are about to get cut.

Let's hope that these studios aren't saddled with having to use a single engine for all of their development in the same way that Bioware got trapped by EA into using Frostbite for their game engine for the past several games, despite it being NOT built for RPGs or ARPGs at all. 

I noticed that Jason didn't mention Obsidian with the letter, but I have to think that it won't have escaped unscathed. Helluva time for Tim Cain to move back to California to rejoin Obsidian after being in semi-retirement.

Changes Afoot

In case you ever wondered how long it would take for games from other Microsoft game studios to appear on Battle.net, here you go:

The Doom prequel appeared first, and given that it's a Bethesda game I guess it's a no-brainer. But this one just appeared a day or three ago, which did cause me to sit up and take notice:

Given that I watch Tim Cain's YouTube videos, I was surprised to see The Outer Worlds 2 show up on the Battle.net front page.

That immediately got me to hop over to Steam just to check to see if both games were able to be purchased over there --they were-- and then I began wondering just where this will end. You don't see any non-Call of Duty Activision games on Battle.net, but if these two end up on BNet, does that mean more will follow? And what about the backlog of titles from these and other Microsoft studios? Will we see Minecraft show up soon? Or will we actually see a purchasable skin for Minecraft of various Blizzard properties?

Maybe there are some things that man was not meant to know...

Just Living in Interesting Times

Oh yay, Microsoft got rid of more people from XBox.

And, as Michael Bell pointed out, Microsoft just announced a $60 billion stock buyback at the same time.

So.

I don't think I'll ever pine for the days of Bobby Kotick, but Microsoft is basically claiming "poor" and cutting people at the same time as they're pumping in tons of cash to prop up the stock price. Given the (lack of) tremendous cost savings you get from laying off 2550 people --hint, it's not $60 billion-- it certainly seems like Microsoft is trying to starve Activision Blizzard into.... Something.

Submission, maybe?

I'm not sure what Microsoft is thinking about XBox long term, because they're struggling to compete with Sony's Playstation. I do know they're going all in on Copilot, as I can't open up my work email without seeing another missive from Microsoft about how awesome Copilot is. Maybe they're hoping that customer service for XBox games will get so bad that Copilot will seem to be an improvement. But I doubt Microsoft is even thinking that far ahead, given that publicly traded corporations have an obligation to "maximize shareholder value" to the exclusion of all else. 

***

On the flip side of publicly traded corporations, there's private equity.

Basically, it's all of the greed and short-sightedness of publicly traded corporations but in a private format where their activity is hidden from public view.

You know, everybody's favorite business: the Embracer Group.

Well, Juraj Krupa of AJ Investments is going after Ubisoft and wants to take the company private.

I have no pity for Ubisoft itself, but I also have little time for corporate raiders. They call themselves "activist investors" now, which makes them sound like a do-gooder, but the reality is they want to take control of a company, maximize their profit, and then get out while profits are at their highest.

What does AJ Investments want to do? Oh, not much. Just run Ubisoft like how Bobby Kotick ran Activision Blizzard, complete with a focus on only a few properties that pump out products every year and maximize cash shops and in-game purchases.

Ay-yi-yi.

May you live in interesting times, my ass.

More Consolidation is in Order

In other CRPG news, Obsidian Entertainment agreed to be bought out by Microsoft.

I'm not sure what to think of this. On one hand, it's nice from Obsidian's standpoint to not have to worry about where the next set of paychecks is coming from, but I do wonder at the cost to independence and culture.

Obsidian's forte is the CRPG, having been involved with the genre for 20+ years*, so I'm not sure what Microsoft is expecting out of Obsidian, given that the XBoxOne's (and PS4's) forte is more heavily graphically oriented than what Obsidian works with. Don't get me wrong, an isometric CRPG can work well in a console format**, but that's more the exception than the rule for console games. And, truth be told, console gamers aren't exactly clamoring for a CRPG design style that dates back to 1998 and Baldur's Gate with the original Bioware Infinity Engine.

Still, what CRPGs like Pillars of Eternity and Tyranny have is story, and if Microsoft wants to take Obsidian's world building and storytelling, throw in some current-gen console magic, and whip up a new CRPG franchise, that's fine with me.

All I ask of Microsoft is to let Obsidian do what Obsidian wants to do also, because that independence will reap dividends in the long run. Yes, yes, I know Microsoft says that they will, and I'm sure that they'll try to at first, but the thing is that very few companies retain that independence over the long haul. By giving Obsidian the chance to fail without fear, Microsoft will be giving a software studio a chance to dare to reach even higher.

And who knows, maybe that'll provide Microsoft with the next Dragon Age or Witcher franchise.





*Obsidian was formed by former members of Black Isle, who'd created Icewind Dale, Planescape: Torment, and Fallout 1 and 2.

**Just look at Blizzard's D3 port to consoles for an example.


EtA: Fixed a confusing grammar error.