The Video Game Industry Is Melting Down
There’s been an eerie commonality in video game news during around the last couple of weeks: We almost cannot go one business day without news that a game development or publishing company has shed employees, if not shuttered entirely. It’s not a good trend, perhaps one emblematic of an industry in trouble. Either way, it feels like the game development and publishing world are going through a course correction. That’s bound to extend outside the industry and to the audience in due time.
The constant layoff news has been sobering. The newest one involves Telltale Games, which shed a bunch of staffers. This is, sadly, not a repeat of this very point in 2018, where the original Telltale Games shuttered and left developers scrambling for work elsewhere. These are part of the new and reformed Telltale that came roaring back to life in 2019. The layoffs have reportedly impacted the development team working on The Wolf Among Us 2, a game planned for development by the old Telltale before it was shuttered, but they’re claiming it’s not cancelled. Either way, it’s a crying shame, perhaps a sign that The Expanse: The Telltale Series isn’t bringing in serious numbers despite Telltale not entirely developing that project.
The co-developer for that project, in fact, was Deck Nine, which notably had its own layoffs earlier in the year. This was perhaps due to being unable to immediately secure a new project following The Expanse’s development.
Telltale is only one video game industry casualty this week. Naughty Dog reportedly laid off a bunch of contractors earlier than expected. Kotaku reported that development on The Last of Us multiplayer game, thought to be a multiplayer version of the “Factions” experience that came with the original PlayStation 3 version of the first title, has been stalled. At least none of the layoffs affected full-time staffers at the company, but that’s only a small comfort.
Some layoffs have been brought about by the heads of these companies making woefully idiotic spending decisions. At the top of these examples is Embracer Group, which has been slowly leaking since their potential investment from the Saudi Arabia-backed Savvy Games Group went down in flames that reached a pile of oil barrels. This and the underperformance of the new Saints Row did Volition in. It’s also resulted in layoffs at other developers, including Tomb Raider-developer Crystal Dynamics, MX vs. ATV Legends-developer Rainbow Studios, and Borderlands series developer Gearbox Software, the last of which they’re also considering selling off entirely. Embracer CEO Lars Wingefors? Don’t worry, he’ll be fine. The pain skips the bosses and trickles down.
Another company that’s run into a precarious predicament through a partially rudderless ship is Epic Games, the home to some of the largest layoffs in gaming lately. Fortnite continues to be massively profitable, one of the most successful initiatives in video game history. But that wasn’t enough to save a whopping 830 people from joining the unemployment line. The company is prepared to offset this by raising the prices of V-bucks in Fortnite itself, and raising the price for the use of Unreal Engine 5 outside of game development. They’re making sure not to run into the same disaster Unity did. But they didn’t have to be here in the first place.
Perhaps some of Epic’s issues can be traced back to the company purchasing what used to be a large shopping mall in 2021, a ridiculous acquirement that always had heavy potential for backfiring.
Perhaps their issues are also due to the constant massive spending on Epic Games Store exclusives. But just in case anyone thinks this could result in EGS melting down within days and leaving Valve’s Steam the only big competitor, Epic CEO Tim Sweeney heavily implied that won’t happen. He literally outright said that EGS was the “cure to the disease” in the gaming industry during Unreal Fest 2023. Sweeney at this same event acknowledged that Epic started running into financial issues about ten weeks ago, but it’s clear they’re not changing anything about their business practices. They plan to keep going and see what happens.
These situations and more are part of the gaming industry’s post-pandemic comedown. Video game spending and playtime spiked during the period where people were stuck in the home, which led to hiring sprees and increased company spending all around. But that wasn’t going to last with people returning to jobs in offices and several other places. It was always clear that this wouldn’t remain the case, but it must once again be said that the people who made these decisions will be perfectly fine. Everyone else must suffer, as we’re seeing right now.
None of this will change how great of a year this has been for video game software. We’ve been graced with a constant number of superlative games in the last couple of months alone, including Baldur’s Gate 3, Starfield, Armored Core 6, Sea of Stars, Lies of P, Mortal Kombat 1, Fate/Samurai Remnant, and too many more. But these problems will lead to less superlative years for games. But as Rami Ismail said, we can’t have these if the employees who make them are constantly laid off, especially if they get employed outside the game development world. The game industry bleeding has likely not let up yet, but I’ll keep my fingers crossed that good luck will come to those affected.
About The Author
Geoff
News Editor | Geoff is some nerd who writes for a blog and thinks he's knowledgeable. He write a lot about video games, but is capable of writing about other subjects, too. Twitter
