Xbox is one of the biggest names in the gaming industry. The company leaves no stone unturned to ensure it eventually emerges in the top spot. It does so by burning more cash to buy studios or by offering a service like the Game Pass.
When Microsoft joined the long list of massive corporations that acquired smaller studios to expand, worryingly, it also disrupted the market. Such giants alter their subsidiaries’ decisions or shut down these studios entirely. All this doesn’t favor consumers and causes a dip in quality, which is preposterous for the industry.
Xbox’s Greed Leading to Layoffs and Studio Closures
Being a subsidiary of Microsoft, the world’s third-most profitable tech company, the gaming division has all the capital it needs to buy its way to the top. This was demonstrated when the corporation acquired Activision-Blizzard in a staggering $69 billion deal.
Since 2002, the corporation has acquired numerous studios in an effort to boost profits and compensate for disappointing hardware sales, Phil Spencer, the gaming division’s CEO, announced that three games initially exclusive to Microsoft’s ecosystem would be going multiplatform.
One of those four games was Hi-Fi Rush, which received immense acclaim from gamers and critics but was sadly not profitable. Now, the corporation has shut down Bethesda’s Tango Gameworks, which developed the title, along with other studios, including Arkane Austin, the developer of Prey.
In 2024, Xbox has closed down more studios than it has released titles, which is a terrible state to be in. In a tough time for Arkane Austin, the Arkane Lyon chief made a series of heart-wrenching tweets to express his opinion and share his emotions about the studio shutdowns:
Also, this news came after Phil Spencer and the company announced that they would be laying off close to 1900 people, which was deplorable. A few months after the Activision acquisition was all it took to oust close to two thousand people.
Playstation, Tencent, Embracer, and Other Players Who Have Caused a Disruption
It can’t be said that a mammoth corporation like Microsoft didn’t know that its acquisition of Activision wouldn’t reduce the margin of error for its existing subsidiaries. Can the line between dismissal and a secure job be crossed if the studio makes one game that isn’t profitable?
Looking at the statistics, over 9000 people have been laid off in 2024 alone and we are not even halfway into the year. We are on the verge of crossing 2023’s number, which was close to 10,000. At what point does a job in the video game industry become a metaphorical suicide mission?
If one thinks that the career support offered—which should be mandatory, all things considered—is enough to make up for everything, consider the case of a person on a work visa:
And Phil Spencer and team aren’t the only ones responsible for all this; PlayStation is just as guilty, as it laid off 900 employees by closing its London Studio in 2024 and announcing layoffs a whopping number of times, per the 2023 layoff database with exact numbers not known. The studio is also brilliant at playing innocent and painting indie studios as scapegoats; a case in point was the recent Helldivers 2 controversy.
Talking about Embracer, the media holding group is infamous for canceling 29 unannounced games and shutting down 7 studios, laying off over 1300 people. Tencent laid off 530 people, and the list seems never-ending.
Indie Titles Like Palworld and Helldivers 2 Can Teach a Great Deal to Corporate Giants Like Microsoft and Embracer
If there is something that recent indie titles have taught us, it is that you do not need an infinite budget to create good games. Helldivers 2 and Palworld are two of the most significant examples.
Nowhere am I saying that gaming studios or corporations shouldn’t be profitable; it is required for their sustenance. But everything in the industry, especially in the last two years, has become more about maximizing profits and expanding presence at the cost of the workforce.
If you prioritize making profits through scummy means like microtransactions, sequels, and remasters, you remove the industry’s two basic principles: quality and creativity! And this has to stop; otherwise, the doomsday for the industry, which would see people not even considering associating with it, is likely not very far.
What do you think of the current state of the industry? We would love to know your thoughts on the consistent layoffs in the comments below!
