Microsoft announces 4 studio closures—including Arkane Austin and Tango Gameworks, creators of Prey and Hi-Fi Rush respectively

Hi-Fi Rush screenshot of Chai and 808
(Image credit: Tango Gameworks)

Microsoft's Xbox division has announced a rash of studio closures as part of an effort to prioritise "high-impact titles" according to multiple sources, including IGN and Bloomberg. Included in the four announced studio closures are Arkane Austin, Tango Gameworks, Alpha Dog Games, and Roundhouse Games. 

Arkane as a whole has been responsible for several excellent games over the years—such as Dishonoured, Prey, and Deathloop. Arkane Austin's most recent effort, Redfall, was far less well-received. Arkane Lyon will survive Arkane Austin's closure to work on its adaptation of Marvel's Blade

Tango Gameworks, meanwhile, developed The Evil Within games and Hi-Fi Rush—as well as Ghostwire: Tokyo. Both will be joining Alpha Dog Games and Roundhouse Games (formerly Human Head Studios) in the round of closures.

As per a letter sent to IGN by Matt Booty, head of Xbox Game Studios, the decision was made out of a desire to funnel more resources into "high-impact" titles, including Bethesda's games. 

"Today I'm sharing changes we are making to our Bethesda and ZeniMax teams," Booty writes. "These changes are grounded in prioritising high-impact titles and further investing in Bethesda's portfolio of blockbuster games and beloved worlds which you have nurtured over many decades.

"To double down on these franchises and invest to build new ones requires us to look across the business to identify the opportunities that are best positioned for success. This reprioritization of titles and resources means a few teams will be realigned to others and that some of our colleagues will be leaving us."

Arkane Austin will see some, but not all, of its members moving to work on other projects under the Bethesda banner—likewise, Roundhouse Game will also be merged with ZeniMax Online Studios. Otherwise, it's shut doors all 'round.

Developers have already taken to Twitter, both to express their frustration at the sudden news—and to offer sympathy for those impacted. "This is absolutely terrible," writes Dinga Bakaba, co-creative director at Arkane Lyon. They implore those in charge to avoid the kind of cutthroat behaviours that led them here in a further thread

"Don't throw us into gold fever gambits, don't use us as strawmen for miscalculations/blind spots, don't make our work environments darwinist jungles. You say we make you proud when we make a good game. Make us proud when times are tough. We know you can, we've seen it before … For now, great teams are sunsetting before our eyes again, and it's a fucking gut stab."

This news comes as a further pile-on to the crushing waves of layoffs that rocked 2023 and are, unfortunately, continuing into 2024. 

Redfall vampire

(Image credit: Tyler C. / Arkane Austin)

It's a sting in two parts—Arkane has historically had a great pedigree of titles, while Tango's work on Hi-Fi Rush was extremely promising. Plenty of infuriated fans of the latter have already brought up this tweet from almost a year ago by Xbox's Aaron Greenberg, who called Hi-Fi Rush: "a break out hit for us and our players in all key measurements and expectations".

However, Arkane's Redfall was a major embarrassment for both the studio and Microsoft in general, and while Hi-Fi Rush is an exceptional, extremely popular videogame (it was my personal pick last year, after all) Ghostwire: Tokyo didn't quite set the world on fire. As such, Microsoft's mission statement here could be read as bracing for Starfield's short tail by scuppering—and the air quotes hang heavy here—'underperformers'. 

Starfield sold well, of course it did, but it had nowhere near the continued interest as some of Bethesda's other mainline RPGs. As our online editor Fraser Brown pointed out last week, the modding community isn't as ravenous, and while Starfield was nominated for a lot of awards, it didn't win many. I'm not sure Bethesda can afford for its next project to stumble in the same way.

Startfield video game

(Image credit: Bethesda)

Microsoft itself also spent $68.7 billion on Activision Blizzard recently, which firmly plays into the persisting, Embracer-style story of large companies snatching up a bunch of studios, only for the house of cards to crumple later at the cost of said studios and their cancelled games.

Ultimately, these closures are a grim reminder of the sudden collapses that accompany a AAA industry dominated by large-scale acquisitions and gung-ho business decisions. It's a pattern plenty of developers have picked up on, and they're reasonably unhappy about a titanic industry that, somehow, completely fails to remain stable.

TOPICS
Harvey Randall
Staff Writer

Harvey's history with games started when he first begged his parents for a World of Warcraft subscription aged 12, though he's since been cursed with Final Fantasy 14-brain and a huge crush on G'raha Tia. He made his start as a freelancer, writing for websites like Techradar, The Escapist, Dicebreaker, The Gamer, Into the Spine—and of course, PC Gamer. He'll sink his teeth into anything that looks interesting, though he has a soft spot for RPGs, soulslikes, roguelikes, deckbuilders, MMOs, and weird indie titles. He also plays a shelf load of TTRPGs in his offline time. Don't ask him what his favourite system is, he has too many.

Read more
rumbleverse
Iron Galaxy lays off 66 employees in a 'last resort' effort to 'enable our long term survival'
Hi-Fi Rush screenshot of Chai and 808
Hi-Fi Rush devs brim with optimism after their near-closure experience, say they're building a place 'where people feel like the work is their baby, not just some task to be done'
Hi-Fi Rush screenshot
Hi-Fi Rush studio Tango Gameworks is officially reborn for the New Year, with a slightly new name
Minute of Islands
Just 2 weeks before the release of its next game, another studio falls victim to the relentless drive to be 'agile'
LONDON, ENGLAND - SEPTEMBER 24: The Ubisoft logo is displayed during the Brand Licensing Europe at ExCel London on September 24, 2024 in London, England. Brand Licensing Europe (BLE) event is dedicated to licensing and brand extension, bringing together retailers, licensees and manufacturers for three days of deal-making, networking and trend spotting. (Photo by John Keeble/Getty Images)
Ubisoft closes another studio, announces layoffs at 3 more as part of 'ongoing efforts to prioritize projects and reduce costs'
Mechwarrior 5: Clans
Piranha Games will lay off employees after Mechwarrior 5: Clans 'performed below projections'
Latest in Gaming Industry
Yoda Luke and R2 in Lego form.
Lego is going to make its videogames in-house from now on, says it would 'almost rather overinvest'
A masked man with an axe in the woods
Rebellion CEO seems kind of awed by major studios making massive videogames: 'How do you organize a game that has 2,000 people working on it?'
A computer screen with program code warning of a detected malware script program. 3d illustration
Coder faces 10 years' jailtime for creating a 'kill switch' that screwed-up his employers' systems when he was laid off
Atomfall screenshot
Rebellion CEO puts the studio's recent avoidance of layoffs down to control of scope and cost: 'Sometimes we say, guys, this game's too big'
Judge Dredd promotional image in Warzone
Half-a-dozen 2000AD games were in the works before fizzling out: 'The games you get to see are a tiny representative of the number that get started—sadly'
sniper elite 5 cover
Sniper Elite CEO reckons Swen Vincke is right to snarl at short-sighted publishers: 'You could argue that their business at senior level isn't making games… their business is managing their shareholders' perceptions'
Latest in News
Recently appointed Intel CEO Lip-Bu Tan.
Here comes Intel's new CEO: a semiconductor veteran that won the same prestigious award as Jensen Huang and Lisa Su
BURBANK, CALIFORNIA - AUGUST 15: Protestors attend the SAG-AFTRA Video Game Strike Picket on August 15, 2024 in Burbank, California. (Photo by Lila Seeley/Getty Images)
8 months into their strike, videogame voice actors say the industry's latest proposal is 'filled with alarming loopholes that will leave our members vulnerable to AI abuse'
Orithopter shooting down another in Dune
Dune: Awakening confirms air-to-air combat in ornithopters
live action Jimbo the Jester from Balatro holding a playing card and addressing the camera
LocalThunk forbids AI-generated art on the Balatro subreddit: 'I think it does real harm to artists of all kinds'
Inzoi - A Zoi's face in three graphical presets showing a progression from a slightly blurry minimum specs to a higher fidelity recommended specs.
Oh great, the full Inzoi system requirements are posted and I'm barely above the minimum specs so I guess my Zois will be beautifully blurry
Mark Darrah
BioWare veteran says a big delay is better than lots of little ones, because sometimes you just gotta 'burn it down and take the other fork in the road'