Microsoft Shuts Down Three Xbox Game Studios

Microsoft Gaming closes three studios under ZeniMax Media, affecting Arkane Austin, Tango Gameworks, and Alpha Dog Games. The move is part of a reprioritization of titles and resources to focus on high-impact games and invest in Bethesda's portfolio.

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Microsoft Shuts Down Three Xbox Game Studios

Microsoft Shuts Down Three Xbox Game Studios

Microsoft Gaming has announced the closure of three studios under ZeniMax Media, affecting the Bethesda Softworks publishing wing of the Xbox first-party group. The affected studios are Arkane Austin, Tango Gameworks, and Alpha Dog Games.

Why this matters: The shutdown of these studios raises concerns about the long-term strategy and financial health of Microsoft's gaming division, which has invested heavily in acquiring studios and properties. This move could have a ripple effect on the gaming industry, influencing the decisions of other companies and potentially impacting the job market for game developers.

Arkane Austin, the studio behind Redfall, will close with some members reassigned to other ZeniMax studios. Redfall will no longer receive updates, but its servers will remain online for players to enjoy. Tango Gameworks, the Japanese developer of Hi-Fi Rush, will also shut down, though the game will continue to be available on existing platforms. Alpha Dog Games, the Canadian studio responsible for the mobile title Mighty Doom, will close, and the game will be sunset on August 7.

In addition to the studio closures, Roundhouse Studios will be folded into ZeniMax Online Studios, which works on The Elder Scrolls Online and is developing a new IP. According to Microsoft Gaming president Matt Booty, the closures are part of a reprioritization of titles and resources to focus on high-impact games and invest in Bethesda's portfolio of blockbuster games and beloved worlds.

In an email to employees, Booty stated, "These changes are not a reflection of the creativity and skill of the talented individuals at these teams or the risks they took to try new things. I acknowledge that these changes are also disruptive to the various support teams across ZeniMax and Bethesda that bring our games to market." A small number of roles across select Bethesda publishing and corporate teams will also be eliminated, with those affected receiving severance benefits informed by local laws.

This move comes after a wave of layoffs at Microsoft Gaming earlier in the year, which affected 1,900 people across Activision Blizzard, Xbox Game Studios, and ZeniMax Media. The industry has seen a significant number of layoffs in recent months, with thousands of employees let go at companies like Riot Games, Take-Two Interactive, and Sony.

The shutdowns have raised questions about Xbox's business plan, which has involved acquiring existing studios and properties, including Bethesda and Activision Blizzard. Fans and developers are mourning the affected studios, with some criticizing Xbox's decision as senseless, given the success of games like Hi-Fi Rush.

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