38 Studios And Big Huge Games Lay Off All Staff

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In incredibly bad news, it’s been announced tonight that 38 Studios, and its wholly owned subsidiary Big Huge Games (Age Of Empires III, Rise Of Nations), are laying off their entire workforce. The Curt Schilling-owned enterprise was in a noticeably shaky state earlier this month when it was unable to make a repayment for a massive $75m loan it had taken from Rhode Island state in 2010, despite decent sales of Kingdoms Of Amular, and great promises of an MMO to come. Having just managed to make this repayment, staff began to notice that something was still up as paychecks failed to arrive in bank accounts, and health insurances were running out. And now, in a rather unpleasantly brisk email, they’ve learned that all 379 of them are immediately out of a job.

The email, as revealed by Gamasutra, reads,

“The Company is experiencing an economic downturn. To avoid further losses and possibility of retrenchment, the Company has decided that a companywide lay off is absolutely necessary.

These layoffs are non-voluntary and non-disciplinary.

This is your official notice of lay off, effective today, Thursday, May 24th, 2012.”

The use of “economic downturn” strikes as particularly egregious, perhaps even disingenuous. The company in fact was experiencing an enormous lack of money having accepted a massive loan by relocating to Rhode Island and getting into massive debt with the state.

A press conference taking place as I type had Rhode Island governors explaining that they saw no reason to be confident that the company would go on to become profitable. And Rhode Island have just published a lot of related paperwork here.

A Rhode Island governor has said that Amular would have needed to sell 3 million units to break even.

We wish the very best to all those affected by the lay offs, and hope everyone is quickly able to find work. Twitter is currently alive with job offers via the #38jobs hashtag.


  1. rockman29 says:

    Son of a….

  2. ZIGS says:

    “A press conference taking place as I type had Rhode Island governors explaining that they saw no reason to be confident that the company would go on to become profitable.”

    They probably saw their next game was gonna be an MMO

    • HermitUK says:

      Given that the combat was the only thing Amalur really had going for it, I didn’t have high hopes for the inevitable decision to replace it with skill hotbars.

      • ipshdg says:

        They sold less than half a million, decent numbers for a smaller project, but this was a AAA dream title with novelists and fucking unicorns and shit attached to it.

        • KingKio says:

          These advertisers are getting fucking sneaky as hell.

          • Belsameth says:

            I actually fell for it :(
            Saw it was a different link on mouseover, but then is was too late and I already clicked…

            Wel played bot, well played!

          • Droopy The Dog says:

            Very much, an entirely apropriate comment with a fake link to steam just begging your curiosity, then a super obvious spam comment afterwards so even if someone goes “this is spam” people might not realise that both comments are.

            ….Then they use a fowarding site called fishurl, like they’re openly admitting it’s bait on their advertising hook, those smug sonova-!..

            Also, why the hell do advertisers even pay for this? Surely conned referals have a 0% conversion rate to actual customers and the owners have the sense to check where their traffic’s coming from.

          • Createx says:

            Perhaps they aren’t going for a buy, but for a drive-by infection…
            So better stop using that IE 6 now :D

          • Tatourmi says:

            Any report of spyware/trojan on this link?

          • cyphercolt says:

            Typing that link manually brought me to Arma II, oh well not a fan thanks bot =p

          • Napalm Sushi says:

            I share the doubt that these advertising tactics actually work. Even factoring out the worry that my PC has just been flooded with malware, any interest I’d have in the product is completely overshadowed by resentment at having been so directly and unapologetically decieved.

          • LionsPhil says:

            I wonder what happened to the “report” link.

            RPS needs a moderator badly, if only because the spamfilter doesn’t work.

          • Zarunil says:

            Fuck, I fell for your ad you sneaky bastard!

            These bots are getting out of hand, RPS.

  3. brau says:

    Yea… sad news… i have friends that work there. Hopefully experienced people like them can get a new job soon enough.

    • Shuck says:

      I hope they’re alright. I know a lot of people in the game industry who have been in this situation, and I know how hard it is to be laid off after missing a couple paychecks and the company unlikely to ever pay the back wages they owe.

    • Thermal Ions says:

      I’m sure they’re all so glad the company made the tough choice to lay them off to “avoid … [the] possibility of retrenchment”. /sarcasm

      Hoping they pick something else up quickly.

    • PopeJamal says:

      That sucks. Hope the best for them.

      “The Company is experiencing an economic downturn.”
      What a bunch of assholes. They might actually be better off not working for weasels like that.

  4. marach says:

    I forsee a post in the coming weeks “Brian Reynolds joins Firaxis”

  5. kwyjibo says:

    Such a shame.

    Thought that Amalur was doing OK, it was a new IP and reviewed quite well. What kind of numbers did they need to fund the MMO? Skyrim numbers?

    Still, their business plan had more going for it than the APB guys. Those guys deserved to go down from the outset.

    • FunkyBadger3 says:

      Game got tedious to the point of never turning it back on after half an hour.

      How much did the bloody thing cost to make, anyway?

      • Shuck says:

        I’d guess total costs were in excess of $40 million for Amalur. That they apparently counted on turning a substantial profit to keep the MMO side afloat is absurd. (I’m guessing that’s the case, since they seem to have been caught short, financially speaking.)

        • TsunamiWombat says:

          Don’t gamble with what you can’t afford to lose, business 101. Too many companies rolling the dice on huge AAA projects or worse, MMO development, hoping and praying for that magic cow of renewable cash.

          They should’ve developed a series of smaller, more easily profitable games, increasing their statistical odds of overall net gain. Instead they went all in on some bullshit RPG dreamteam which once again proved attaching a novelist to your project don’t mean shit.

          • Slaadfax says:

            Sadly, even the dream team effect doesn’t give them enough *name* to instantly push massive sales for a project like that.

            Most folks identify more with company names than they do with specific individuals within the creative sphere. Obviously there are a few outliers who have some level of push by themselves, but it still begs the question how much difference it makes towards larger marketing principles.

            The dream team approach didn’t work out for Shadows of the Damned, either.

            I’m trying to think of people who have names that would actually push sales of a product. Honestly, the only one I can immediately think of is Sid Meier, but mostly because his name is already closely associated with the product/on the friggin’ box.

            Who else… Hideo Kojima, I suppose (even though he’s sort of an awful writer). Carmack maybe (though quite a bit less than a few years ago), Tim Schafer (he’s never been a big seller of anything, but the Kickstarter obviously went well enough).

            Even worse for Kingdoms, you have a cross-media dream team. It’s not some magical gathering of the finest game creators to lend their names to an amazing title. I’m sure there are plenty of gamers who haven’t heard of Salvatore or McFarlane, or even Ken Rolston.

          • Shuck says:

            I suspect that even the biggest “names” don’t mean a darn thing, especially when you get to the sorts of scales we’re talking about here (i.e. needing to sell 3M copies). A “big name” in the game industry might sell enough to support a small indie game, but that’s about it. As you say, studio/publisher (and game series) names have more cachet – no one’s bothered by (or even aware of, necessarily) the fact that Diablo 3 was made entirely by a team that had nothing to do with Diablo 1 or 2, for example.

            When 38 Studios were first announced, they did this absurd arithmetic where they took how many fans (or web followers, or something) each of the heads had (Schilling, Salvatore, McFarlane) and added them up to get their expected sales/subscriber numbers. It was sheer fantasy.

  6. Apolloin says:

    Everyone is experiencing an ‘Economic Downturn’ but not everyone is laying off their entire workforce. Let’s be clear about this, this is due to nothing more or less than an incredibly poor business model and equally poor business decisions and blaming macro-economic conditions for it is asinine.

    Why can’t management just admit that they screwed up? It’s crystal clear that they did and owning up might actually help all those people who are now not only looking at losing the months salary that they are owed, but not getting the months notice they deserve too…

    • Galcius says:

      It’s management speak. They’re blaming the recession for two reasons:
      1: Senior Management will never admit fault (or face any consequences beyond a ‘Golden Parachute’)
      2: They’re hoping to sell off their IP and unfinished game to recoup some of their losses, and admitting that it’s bland and crap won’t exactly help.

      • Joshua Northey says:

        Well said.

        Management never falls on its sword. And someone as arrogant as Schilling. He really going to come out and say “we had a really poor business model”. No he is not.

        it is the same thing you find with studios run by former developers instead of businesspeople. They make a successful game, scale up from a small shop to a mid sized, not the lead programmer is running the business side, and they promptly collapse because the skills sets for being the lead programmer and “ideas guy” and being the person who actually runs the business have almost no overlap. A few can pull it off, most go down in flames if they don’t get some business people to help.

        • povu says:


        • TsunamiWombat says:

          Correct, right now the employee’s are a liquidable asset. They’ll be cut loose and the Company assets including the “hardware”, desks and chairs and shit and the “software”, IP, the company name, titles, holdings etc will be sold off to cover the debt and any net profit will go into the pockets of the owners.

          Welcome to Capitalismart, fuck you and your dog
          *this is meant to be a shot at capitalism, not an insult to anybody!

          • drewski says:

            You don’t really understand the concept of creditors, do you?

            If the remaining assets had a liquid value higher than the outstanding debts, they wouldn’t be shutting down. The owners are going to get nothing when this is finished, and the creditors will get cents back for every dollar owed.

          • Thermal Ions says:

            Not really true Drewski. A company can still be liquid (disposable assets > liabilities), however if you don’t have the cash to meet your operating expenses you may need to shut down. During a mass asset sell off to cover liabilities it reaches a point that the assets remaining (after debt is paid off) are insufficient to enable you to carry on business in any effective way. Thus the company shuts down and the owners get the remaining assets.

            Unfortunately too many businesses have no idea and blindly continue on past the point where they should have said, “okay we’re going backwards and need to make the hard decision to shutdown while we can still pay our creditors out”. The “goodwill” balance sheet item that artificially inflates total assets also has a lot to answer for in this regard.

            That said, I suspect from everything I’ve read that 38 Studios fall more in this later situation than simply a negative cashflow while retaining a positive asset base.

        • shlork says:

          > Management never falls on its sword. And someone as arrogant as Schilling. He really going to come out and say “we had a really poor business model”.

          And risk getting sued by investors?

  7. misterT0AST says:

    They are a company that makes games.
    They made a game, and it had decent sales.
    They are now bankrupt.
    I’m missing something here.

    • zaphod42 says:

      Its pretty simple: software is far, far, far, far, far more complicated than non-software people will EVER imagine.

      This is a perfect case study for what would happen if any of the nerds in the WoW forums was ever handed 50 million dollars to make “their dream game”.

      A whole lot more goes into making a game than just listing off the features you’d like to see. If you don’t have the right planning and management, you’re going to spend more money than you make, easily. And thats on top of the fact that games, as entertainment, are a very fickle industry. You’re trying to make “fun” as a product, and that is ridiculously hard to quantify.

      I’m actually surprised they managed to get the one game out the door.

      I’m also surprised that Rhode Island gave them so much money in the first place. Terrible idea.

      • LionsPhil says:

        I find it hard to believe this this one was a development failure, when it has all the trappings of inept management.

        (Huge clue #1 is scapegoating the failure on the economy.)

        • Sarkhan Lol says:

          Basically this. The company structure in itself was a WTF waiting to happen.

        • Joshua Northey says:

          It was a management failure, but also I don’t think the developers covered themselves with glory. They made a solid game, they were given the resources to make a great game. One of management’s big gaffes (I am sure there were many) was not realizing that even good developers miss as much as they hit.

        • zaphod42 says:

          I never even REMOTELY suggested it was the developers’ fault. My point was EXACTLY that, that it was al management, terrible management.

          Look at what I said:
          “software is far, far, far, far, far more complicated than non-software people will EVER imagine.”

          I’m not saying that the software developers didn’t understand the complexity of the project; they’re software developers. I was speaking EXPLICITLY about NON-SOFTWARE people, aka MANAGEMENT.

          My entire point from the start is that software is one of the hardest things to manage ever. The schedules are impossible to predict, and often some components will prove more complex than you planned. Feature creep and other problems can pop up and ruin everything, make you go Waaaay over budget, if you don’t have someone at the reigns who understands that.

          Someone coming in, with a ton of money, just wanting to “buy” the game they want, isn’t going to do it right. You have to have a whole background in software management.

      • Stardog says:

        “Its pretty simple: software is far, far, far, far, far more complicated than non-software people will EVER imagine. ”

        Not really. I make games.

        • Mo says:

          Uhhh, then you, by definition, would understand since you’re a software person?

          I find that the people I know in software who underestimate its complexity are the ones who don’t ship and/or are surprised when delays happen.

        • Kadayi says:

          “Not really. I make games.”


      • BAshment says:

        It may be more complex in certain aspects but has virtually no hard resources required and I doubt they spent 50m$ in man hours or electricity bills.

        • Joshua Northey says:

          Its pretty easy to spend $50 million in man hours. The cost of a professional with a desk, an office building, HR staff, management, and equipment is maybe $75-125/hr. So lets say $150,000-$250,000/year.

          They had a couple hundred people. So you are looking at 25 million a year possibly.

          Plus they purchased some other businesses. That costs money as well.

          $50 million doesn’t go very far when you are employing a hundred or more professionals + support staff.

      • misterT0AST says:

        38 studios were not rookies though. You speak as if they were nerds from a WoW forum.
        Do you think they spent all they had in software for Amalur and its sales couldn’t compensate the expenses?
        Or do you think that they spent everything on software for the future MMORPG?
        Was it ALL money spent in software, millions and millions of dollars of software?

        Was it the game they made or the game they were planning to make, that dried their finances?
        …or (third option) did they lose the money in some other way?

        I’m genuinely asking.
        It just seems weird that they made 1 game,
        it did pretty well,
        and now they’re out of money.

        • Joshua Northey says:

          They had the staff and production values for a really really successful game, not a run of the mill game.

        • drewski says:

          The devs might not have been, but the head guy’s a baseball player who’d never run a business.

          I know, I know, athlete with no business management skills. Unlikely, but apparently true in this case.

        • Shuck says:

          Big Huge Games made Amalur – they’ve been working on an RPG for about 5 years, getting bought and sold several times during that time and redoing a good bit of the game each time. Main development on Amalur apparently took 2.5 years and 100 people. 38 Studios bought Big Huge and were also spending money like crazy on another team making an MMO. Amalur didn’t even begin to break even and apparently 38 was counting on profits to keep in business.

      • Joshua Northey says:

        Well said Zaphod. I manage small project right now, maybe tens of thousands to hundreds. You wouldn’t believe how much “paper” I push. Mountains of paper. The “if I only had a few million dollars I could make the next great thing people” are absolutely deluding themselves about the scale and resources that go into something.

        Luckily there are tons of them, and a few of them do make it so we keep getting good games.

    • Stardog says:

      They hired too many people. They spent too much on wages. They hired “names” instead of talent. The gameplay was boring. It was too consolized to be taken as a serious RPG.

      • Malibu Stacey says:

        Your first 3 sentences made me think you were Bobby Kotick come to teach us all the reality of games development.

        Then I read the last 2 & realised how wrong I was.

    • Merus says:

      There’s basically no such thing as an A-class game any more, like there used to be. Either you make a AAA game, with AAA sales, or you make a downloadable game and be comfortable with 250,000 being a smash hit. There’s no middle ground any more.

      • drewski says:

        That’s nonsense. You can still have a middle ground, you just need to budget for it.

        If you spend a AAA budget, sure, you need AAA sales. But KoA sold over 1m copies – if it had a $10m budget instead of a $30m one, money would be made.

        Not that I know what KoA’s budget was.

        • Joshua Northey says:

          $30mil sounds reasonable. Other monies were spent on start-up costs, acquiring BHG, and the second game which will probably never happen.

        • aepervius says:

          1 million copy (did they sell that many worldwide ? After 1 month it had only sold 330K for the US), 50$ from which they might recoup in the best case 15% to 20%, that does not justify in any way shape or form a 30 million budget. Maybe 5 to 10 million, and having played the game they could have easily cut the number of area by half or even more.

        • Shuck says:

          @drewski: The problem is that $10M game is an awkward size – too big to get by on indie-level sales, but not big enough to compete with AAA games. And that’s a problem as it’s about the amount of money the average AAA console game makes – games which have at least $25M budgets (yes, the average game loses a whole hell of a lot of money). Half of the $10M could easily be marketing costs, for one thing, and a $5M game is very unlikely get you AAA-scale sales.

    • Mo says:

      I believe most of the money was spent on the unreleased MMO. KoA sold well, but probably not enough to offset the massive expenses of developing an MMO.

    • drewski says:

      They probably borrowed money and used the sales of Kingdoms of Amalur as collateral, hoping they’d sell enough copies to pay off the loan and still have enough left over to fund development of the MMO.

      But Amalur only sold around 1m, not the 3m they needed to fund Copernicus.

      When they realised they were stuffed, they spent two weeks trying to pimp themselves out for a private equity injection of cash, now they haven’t got it, they’re broke.

      ’tis unfortunate, but scratch the surface of any business model that fails and you’ll see a pretty similar story.

      • Joshua Northey says:

        This is a thing layman always fail to understand. Most businesses even very successful ones are up to their eyeballs in debt. Boeing, Best Buy in the 90s, Lehman Brothers, Blizzard, whoever. They take out huge laons. But they have revenues they use to service that debt and hopefully earn a greater return on the money than the interest.

        It is was makes video games such a make or break business. Best Buy’s revenues are not likely to fall year to year more than a few percentage points even with the death of retail, but something like 38 studios can easily see a game do only a third of projected sales and suddenly be totally and completely broke.

        • FunkyBadger3 says:

          Yup. I mean, who could imagine a highly leveraged business failing in this day and age.

          The company failed, pretty simply, due to bad management.

          • Joshua Northey says:

            I think most people really think something like Best Buy is just sitting on huge piles of cash when really it is going out in loan payment almost as fast as it comes in. The plebs really don’t understand business at all sadly.

          • FunkyBadger3 says:

            This is what leads to companies such as Virgin (the record shops) and Game going under. The individual units make plenty of cash – always people in there queuing to buy product, but just not enough to feed the monkey.

            The stock market can be a very destructive thing. There comes a point when many companies would be better off out of it than in – although good luck finding a Cheif Exec who comes out and says that.

            That’s tangential to 38’s issues as they weren’t public. But I wanted to get it orf my chest…

          • drewski says:

            It’s not really the debt’s fault the company’s management sucked.

          • FunkyBadger3 says:

            That said – if you only make 30% of your “break even/survive” sales figure then whoever wrote the business plan needs to be shot*

            *not really shot, but probably not given any more money to play with.

          • drewski says:

            Funky – not sure about Virgin, but Game’s problem was that an awful lot of the individual units *weren’t* making any money (hence the new owners closing them).

            And even if there was no debt to be paid off, there would still be equity demanding a return. There’s no free lunch in business. If your business model depends on not making enough money to give your investors a return, you best have investors with deep and unquestioning pockets…

          • FunkyBadger3 says:

            drewski: if Game had wasted the best part of two years and X millions acquiring Gamestation they’d still be in business (it was always a terrible idea, I think the average diatance between Game and Gamestation shops was something like 150m, the saying goes “any idiot can buy market share”). They accquired Gamestation because they had a largish pile of cash to sit on and shareholders don’t like that, they want to see the capital working.

            Re: investors: you don’t *have* to pay dividends. Not nearly enough boards ask themselves “why are we public”?

            I’d compare these two cases to Woolworths – they went bust, basically, because they had tatty shops full of shitty products no-one wanted to buy.

          • drewski says:

            Yes, but that’s a management failure, not a problem of debt. They overreached in a boom, then got smashed by the bust.

            Story of (badly run) business.

            And no, you don’t *have* to pay dividends but if you don’t, you won’t be able to maintain a high share price which allows you to raise further equity which allows you to grow your business without relying on debt.

            Companies generally go public to finance expansion without resorting to excessive leverage – ie to not go into too much debt. Game wouldn’t have become Game if they has to wait until they had enough retained profits to finance the opening of every new store – that kind of thing takes decades.

          • Optimaximal says:

            For the record, Virgin’s record stores didn’t ‘go under’ for any direct fault of their own. The Megastore part of the company had an MBO, became Zavvi and was doing fine until Woolworths collapsed, taking its product distribution network with it, which Z leveraged. They had nowhere to turn as the only options were the supermarkets or high street rival HMV, none of which would work and still allow them to remain profitable.

          • FunkyBadger3 says:

            Opti: yeah – they were leveraged to the point that a 2 week delay in the supply chain sent them under, despite the majority of the business units being profitable. That’s just madness… (I thought Zavvi only came in after the worst had already happened, though?)

            Drewski – that’s the concept, except there are only a handful of companies that trade without debt (Google, Apple… anyone else?) – generally the point of keeping the share price high is to keep the share price high, and of course the board level bonuses linked to it…

        • jrodman says:

          Sure, Highly Leveraged is the new normal in recent times. But that doesn’t mean it’s necessarily the best way to do things. I’d guess that the current banking climate encourages it, along with a host of other risky and problematic patterns.

    • TsunamiWombat says:

      They sold less than half a million, decent numbers for a smaller project, but this was a AAA dream title with novelists and fucking unicorns and shit attached to it.

      Investment capital go down tha holllee

    • ichigo2862 says:

      If I understand the situation correctly, they were offered a huge loan to finance a move to another state, then expected the game and the follow-up MMO to somehow finance the payment to that loan and sustain further development of other games. The game needed to sell millions, and didn’t sell even half a million. Or just barely over, not sure. In any case, it didn’t sell nearly enough.

  8. NaturalDre says:

    Release the source code! You know you want to :(

    • zaphod42 says:

      I really wish companies were like, required to release their game source code when they go bankrupt, or after the game has ceased sales. That would be SO cool! We could do so much…

      Unfortunately even unfinished game code and art can be an asset you can sell, so they’ll try to liquidate it.

      • jrodman says:

        Art is an asset.
        Code is a liability.

        Sure, businesses don’t generally understand that this is true, so you can kind of fake it by selling a no-value item to other people who don’t realize it’s a no-value item. But in reality code needs constant servicing and feeding in order to get it to do anything new that it doesn’t already do.

        So thinking of the written code you have without all the programmers who built it as an asset, that’s just a joke. Who’s going to buy it? The only buyers for this type of thing is like the people who all just got fired and decide to form a new company to finish their game, provided the old shell is willing to sell. They’re the only person who can make the husk of code have value.

  9. Diggidy says:

    STRANGE QUESTION: It’s really really cool to see other developers tweeting their job leads with the #38jobs hashtag – but, and here’s the strange question, why didn’t this happen for the Austin Bioware staff? Was it the fact that the closure was imminent for weeks, or that the laid off developers are somehow more of a victim at 38, or something else? It’s great that everyone’s helping out 38, but why not the likely-just-as-deserving folks fired from SWTOR?

    EDIT: Thanks for the great answers folks.

    • Apolloin says:

      First of all, that sentiment has already been expressed in the twitter feed. Secondly though there’s something about an all-hands layoff that gets everyone scrambling. This is pretty much akin to a natural disaster and that always brings out the samaritan in people.

    • John Walker says:

      I don’t have any certain answers, but it’s perfectly normal for an MMO to lose about a third of its staff after launch. I’m also not aware how many of those at Bioware Austin went elsewhere in the company. Also, these people would have received redundancy packages, and been given their notice. 38/BHG staff are now finding out not only are they not going to get the money they’re already owed, but no more money from now on.

      • Morlock says:

        John, I know it’s not chic to bring up spelling, but you wrote “Amular” twice and it should be “Amalur”. I am only mentioning this because it’s a game title and it really sticks out.

      • Runs With Foxes says:

        Firing that many people might be common if the game is losing players or is generally mismanaged, but it’s not true in every case. Trion Worlds didn’t have mass layoffs after Rift’s launch. Turbine laid off some staff about a year and a half after launch, but not right after. Somehow I doubt ArenaNet will fire a third of their staff after GW2 launches.

        The common thread seems to be that companies with 200-300 employees seem more likely to keep them all, while companies that hire thousands of people to crank out a cash cow then shed their workforce once they’ve served their purpose. I guess on the one hand they gave more people jobs for a couple of years … but it would be nice if companies took care of their workers a little better instead of treating them as an expendable resource. It’s not something that should be defended in my opinion.

    • kwyjibo says:

      There’s a difference between being made redundant by a firm that can pay your redundancy and one that can’t.

      • Shuck says:

        Redundancy? These developers are probably owed something like 3-8 weeks back wages that they won’t see, much less any proper redundancy money.
        It never fails to piss me off when employees aren’t told the company has no money until their paychecks start bouncing. The company knows it doesn’t have money, but rather than tell people that they won’t be able to make payroll next month so they’ll be prepared, they’d rather screw over their employees. Management gambles that they can find new funding, and they don’t want people to have left the company to find new jobs if the money comes through (even though they know it’s a hugely improbable long shot). Management puts the company’s interests ahead of all their employees, even knowing that the employees could be in seriously bad shape as a result.

        • Optimaximal says:

          I believe he’s talking about Bioware being ‘able to pay’.

    • Lightbringer says:

      WRT the question about devs supporting the Bioware Austin peeps, that is happening, just not in exactly the same manner. There are a number of job fairs being run by local game companies in Austin for Bioware peeps, and a lot of folks helping one another via Facebook and the various branches of the IGDA. This was also done for the Vigil peeps that were laid off.

      • caddyB says:

        Swtor could’ve made so much money if they dropped the whole generic mmo model and went with the free to play but you need to grind or pay up to unlock next part of the story.

        It worked for Turbine.

        • zaphod42 says:

          I’m not sure I agree. The best part of SWTOR was the levelling and the story, but the long game sucked. Once you hit max level, it got super boring. I raided for a couple months and then dropped my connection. But I’l tell you, best leveling game of any MMO ever, no question.

          I do agree that $60 boxed MMOs with a $10/ month fee are completely dead. It’s not going to happen, ever again. Anybody that tries after this is going to fail, and fail hard. Free to play is undoubtedly the future of online gaming. The quote I heard which is so telling,

          “In the future, MMOs charging a monthly fee will be like supermarkets charging a door price”

          That said, your entire game design needs to take it into account. I don’t think TOR would have been better off just flipping it over. They’d get more users if it was f2p, but they’d lose those users before long. The whole aim of free2play is to get all those freebie players to stay playing the game for a long time, so you have an active community which draws in the paying customers.

          • caddyB says:

            Well I think the constant stream of people from being F2P would mean that people would always have things to do in the end game. Right now what I hear is there is nobody to do anything with, and that contributes a lot to boredom when the max level gameplay is based on grouping.

          • Skabooga says:

            “In the future, MMOs charging a monthly fee will be like supermarkets charging a door price”

            Well, it works alright for Costco and Sam’s Club. (Don’t mind me, just being pedantic. And I suppose it’s not really a door price if you wanted to get even more pedantic.)

        • drewski says:

          $30 for the client and one story per side (you can choose which character you get the story for), then unlock new stories for each side for monies.

          Probably wouldn’t have made back their budget though.

          • Phantoon says:

            You’d be surprised. Their business model for SWTOR was never going to work, though.

            A story based MMO? Really? You run out of things to do.

          • Moraven says:

            So make it into D3.

        • Ragnar says:

          Or just dropped the generic MMO model and made KOTOR 3 instead, thus reducing their costs. I tried the beta weekend, got up to lvl 11 or so, and loved playing my Imperial Agent because of the story. If it was a standalone RPG, I’d buy it.

          But a subscription MMO is like an all-you-can-eat buffet, I’m paying a flat fee to be there, so I feel like I need to eat as much as I can, or play every hour that I can, to maximize my investment. It results in exclusively focusing on the MMO, and thus missing out on every other game that comes out, or playing other stuff but feeling guilty that I’m not making the most of my subscription’s value. I much prefer the one time purchase, after which it’s a sunk cost and I can chose to play a game or not as is my whim.

  10. The Hammer says:

    379 people out of a job, just like that? Horrible stuff.

    I’ve been a fan of Big Huge Games ever since I picked up the excellent (and still peerless) Rise of Nations. Knowing that it’s all over for them now really stings.

  11. Mayjori says:

    75 million on that mediocre game…. wtf?

    • zaphod42 says:

      That’s what happens when a millionaire baseball player runs a software company.

    • drewski says:

      Most of it went on the MMO. KoA was close to being finished when 38 bought BHG, they just ported the lore into the game.

    • Xardas Kane says:

      that money was given to the studio, NOT all of it was invested in KoA, actually barely any of it was, msot was spent on Copernicus. So no, no 75 million on a mediocre game.

      • Joshua Northey says:

        Well some of the money was presumably used to buy BHG in the first place. It probably wasn’t free. :)

        So in that sense some substantial money was probably invested in KoA.

        • drewski says:

          Or at least to pay off money that had already been invested in KoA.

          I can’t imagine Big Huge Games were available to buy because they were sitting on a pile of free cash. They were probably in a bit of financial strife too, but they found their knight in shining armour/sucker born every minute (depending on your interpretation), whereas 38 Studies didn’t.

          • Brun says:

            More likely it was THQ that were in financial straits and were looking to offload some subsidiaries to generate cash. When did 38 acquire BHG? It would be interesting to compare the acquisition timeframe to that of the uDraw fiasco.

          • drewski says:

            BHG was sold to 38 Studios in May 2009.

            uDraw for 360/PS3 was released in November 2011.

            So…yeah, no.

    • fish99 says:

      38 didn’t make Amalur though, BHG did.

  12. lordcooper says:

    What a horrible way to notify people. I wish all those effected the best of luck :(

  13. caddyB says:

    Sad to see so many people lose their jobs, and the game wasn’t even BAD. Sure, it wasn’t really good either, but I suppose mistakes were made on the management level. They could make at least 2 games out of Reckoning with a bit of effort. And they wouldn’t have gone bankrupt because they spent all their money on the same place.

  14. Dushanan says:

    Damn. I liked Big Huge Games. It really sucks to see them go.

  15. HexagonalBolts says:

    … and… they were then planning to fund the development of an MMO that, in all probability, had to be in the top ten MMOs to break even?

    • zaphod42 says:

      Yeah, it really shows colossally bad judgement and planning.

      *Sigh* everybody thinks game development is so easy, for some reason…

      • Baines says:

        I don’t know that everyone thinks game development is easy.

        I think it is more that everyone thinks their game will be the success. They are certain that they won’t make the mistakes of other failed games. They’ll do everything right, and that means they’ll be a success. And if they do really well, they may even dethrone the king, because everyone is always griping about its shortcomings and a great game is all it takes to win them over.

        Then 95% of those people release their game, and it sits with the 95% of similar games that were considered just average. And suddenly the company is realizing that they are maybe millions in debt, because they budgeted for a game that sold millions and they ended up with a game that maybe sold a few hundred thousand.

        Of course there are the even more detached from reality cases, like not having money budgeted for post-release maintenance for your MMO. (Didn’t APB run into that issue?)

        • drewski says:

          I don’t think any entrepreneur in any field ever goes into a new endeavor thinking “wow, I bet this fails spectacularly!”

          Probably most don’t think it will be easy, they just think their idea is the one that will work. If nobody thought that, we’d have no innovation.

          • Baines says:

            It’s not even about expecting to fail spectacularly. It is about keeping some objectivity and some realism.

            Don’t assume your game will have sales comparable to the genre leader, and don’t give it a budget that assumes that you will make those kinds of numbers. Look at what the average titles make. You can make a profitable title with lower sales as long as your budget is made with those (lower) sales in mind. And if costs start spiraling, then you need to take drastic measures before it is too late.

  16. Davie says:

    It’s a damn shame, especially since this kills my barely-remembered hope to someday have a Rise of Legends sequel.

  17. ResonanceCascade says:

    Maybe next time hardcore right-wingers like Schilling should stick to their own ideology and think twice before they ask the government for big handout so they can pretend to be private sector “job creators.”

    Now the state has zero jobs and a worthless IP. Way to strike out, Curt

    Although to be fair, it’s not totally Curt’s fault, I’m sure he didn’t want to fail. The people who lent him the money are more at fault.

    But it REALLY pisses me off when Republican multimillionaires like him push to kill government programs that benefit the poor, and then turn around and blow 75 million government dollars.

    • Blaaaaaaag says:

      Meanwhile his own personal bank balance probably hasn’t suffered much…

      • Larkington says:

        I heard a talk he gave at PAX East a couple years back and he made it seem like he had personally invested a ton of money in the project.

      • drewski says:

        He’s rumoured to have sunk $30m of his own cash into 38 Studios.

        • Phantoon says:

          I’m sure that hasn’t hurt his ability to sleep on a pile of cash as a bed.

          • drewski says:

            Probably not, but he wouldn’t be the first star athlete to blow his pile of dosh on a vanity project and go bust.

    • ReV_VAdAUL says:

      Here here and you better bet Schilling will blame the government for his failure on the government that lent him money. I’m not sure how he’ll do it, the mental contortions right wingers can pull off to blame everyone but themselves can often be beyond the comprehension of decent people.

      As you say though, shame on RI for lending him the money in the first place. That said, I’m not sure failing wasn’t all part of the plan, failure can be very profitable for people like Schilling: link to exiledonline.com

      • drewski says:

        I don’t think there’s much parallel between the insider corruption on Wall Street and a video game company in Rhode Island, to be honest.

        • ReV_VAdAUL says:

          Rich dude gets a massive amount of money from the state, spends (or pockets) the money and then fires all his staff without paying them. This is fairly similar to a banker getting a massive amount of money from state governments, pension funds etc, then pocketing all the money and letting the suckers go hang when thngs go bad and asking for government bailouts so as to fund their massive bonuses.

          Heck last week Schilling was even trying to get a bailout just like his fellow 1% scumbags on Wallstreet did. RI was at least smart enough to say no.

          • drewski says:

            Except that the guys in charge of Wall Street banks generally don’t put at risk large sums of their personal fortunes in deals which have a big chance of going bust.

          • Joshua Northey says:

            That is honestly a little too cynical.

            The story is probably a lot closer to:

            Rich dude spends $30million to start up company.
            Company takes out large loan from bank against future revenues.
            Company uses monies to buy another company.
            Company needs another loan and can not get it.
            Rich dude loans the company another 5 million.
            Company get loan garuantee from state, can now getnew bank loan.
            Company pays back rich dude his 5 million loan.
            Comapny later fails.

            The rich dude is still out the 30 million he invested in ownership of a now bankrupt enterprise. This wasn’t a publicly traded company with malfeasant executives, it was a failed private business where the owner now owns something that is worth zero.

            I agree Schilling is a bit og a hypocrite, and that a lot of executives are slimy scumbags. But usually when a private company like this fails the owners due take a huge bath unless they were paying themselves huge salaries (which I doubt he was).

          • ReV_VAdAUL says:

            Schilling has said he has put large sums of his own fortune into the mix. But I’m sure a lying hypocrite who thinks the government should do less for the poor but instead give him tens of millions of dollars to fund his pet project and who doesn’t pay his employees wouldn’t lie about his own investment in the project would he?

            I’m sure Bernie Madoff never told people he invested his own money in the ponzi scheme he called an investment strategy either!

          • drewski says:

            Schilling has almost certainly put a large stake of his cash in this. 38 Studios were already making the game long before they got their taxpayer backed loans, employing around 100 people.

            It may not be exactly $30m, but you don’t run a 100 person developer on a shoestring and from the stories I’ve read on the Rhode Island deal, what little due diligence was done did include looking at the financial statements. I doubt RI would have agreed to the deal if Schilling didn’t have equity in the company.

  18. Jimbo says:

    Next time start with 1 studio, rounders guy.

    Maybe somebody can pick up Project Icarus for cheaps and do something worthwhile with it? Those screenshots that came out today looked kinda hot.

  19. Andrew says:

    “Thanks for all your efforts on the game.”
    “Our regrets about this, and our sincere best wishes in getting a new job.”

    Just a few of the things they could also have said in the email, and didn’t.

  20. Larkington says:

    What a shame, truly. As a Rhode Islander and someone that would like to make games one day, this is really disheartening. Not only is it terrible for those without jobs, but any other game company that would like to move to Rhode Island, or start-up in Rhode Island, is going to have a heck-of-a-time convincing tax-payers and politicians to back them.

    On the plus side, Turbine is hiring and only located about an hour away from Providence, so hopefully those laid-off can find work quickly.

    • zaphod42 says:

      They shouldn’t need the local government to give them money to start up a company.

      Although I guess nobody would want to move to RI otherwise? Sounds like you’re trying to force something that shouldn’t be.

  21. ffordesoon says:

    Poor bastards. The MMO and the name killed them. Everyone I mentioned it to wrinkled their nose at the name, and nobody was invested enough in that world to play an MMO about it. They should have canned that part of it before it hoovered up all the cash. They had an interesting foundation upon which to build a great single-player sequel, and the existing MMO assets could’ve been imported into a quickie sequel without much trouble. I’m sure they had enough landmass built that it would’ve been neat.

    Maybe EA will do something with it, I dunno.


  22. sirdavies says:

    Sad news ;(

    Btw, I’m pretty sure the game is called kingdoms of Amalur, not amular, as you’ve mentioned it twice in the post :P

  23. Kadayi says:


    Hoping someone steps in (EA or Activision) and helps them out.

    • Brun says:

      Don’t get your hopes up. Activision doesn’t need another MMO and EA won’t be interested after SWTOR’s fizzle.

      • Phantoon says:

        I’m getting my hopes up that neither of those incredibly bad companies will buy it up, and it will just sink quietly.

        • Kadayi says:

          How about maybe you put your EA/Activision axe away for once Phantoon? Hundreds of people just lost their jobs without pay and it’s only really the big publishers who might be able to step in and help them out.

  24. Xardas Kane says:

    There goes once one of the best strategy studios out there, Big Huge Games (now part of 38 Studios). There goes years worth of hard work on a massive MMO project. There goes a gaming universe that, while not something jaw-dropping, was interesting and worth exploring further after a fun and enjoyable debut.

    And all of this because some idiot (Schilling) made one moronic decision after another. 350 people just lost their jobs and wasted years of their lives working on a game that probably will never see the light of day.

    Such a waste.

    • Falcyn says:

      Without Schilling, 38 Studios would never have ever existed, and Big Huge would have been shut down by THQ as originally planned in 2009.

      I’m certainly not saying Schilling isn’t partially at fault for what’s happened, but without him, Big Huge would never even have had a chance to finish what became Kingdoms of Amalur: Reckoning.

  25. LifeSuport says:

    I had a big rant but I’m trying stay positive. This was a cash grab. 75 Million into the founders and management and most employees that make >60K for producing failure. Normally this would be the publisher or parent company sharing blame, but in this case unless the State was in design and triage meetings this is all Management, because they can hire and fire people and at the end of the day normally have all the power.

    As for “firing your staff is normal” this lie is up there with games are “art” and that is why we developers SUCK so bad at making them. If they called it Engineering people might wonder why a floor collapse isn’t a “bug” to be fixed during the next remodel (update)

    Id software, Valve software, Epic Mega Games. Apparently these people know how to ENGINEER games AND run a business because they keep hiring. Then again they also know how to make art. AND yes Blizzard doesn’t deserve to be in this list, not anymore, Blizzard left the building.

    STOP SUCKING DEVELOPER COCK when they give you a rare steak, or fix your car the breaks two days later, because that is what most do and the spin has you all putting up with it.

    • Brun says:

      Blizzard, Valve, and Epic have all figured out how to make money without having to produce “art.” Blizzard has WoW subscription fees, Valve has Steam, and Epic has Unreal Engine licenses. I don’t know how extensively id Tech is licensed (certainly not to the extent of UE3), but that’s likely a steady revenue stream for them as well.

      So yes, the trick, it seems, is to figure out a more dependable revenue stream and use that to subsidize game development. That way, they aren’t under pressure to release games at regular intervals just to keep themselves afloat, and can instead spend more time making quality games.

      You’re correct, however, that game development is quite distinct from software engineering, as you are creating an entertainment product. The problem with the industry is that everyone wants to shoot for the AAA budget with AAA returns. If you look at other entertainment industries – they don’t do it that way. Movie studios are happy to back $25M crap like “Saw 7” because they’ll end up grossing $75-100M and that’s a profit.

    • Joshua Northey says:

      The founders didn’t get 75 million. That money was spent on the business almost certainly. The founders are likely out millions of dollars. This was a bad enough case of corporate failure without having to make up stories about it.

      • LifeSuport says:

        Did you swallow yet?

        2010 is when 38 studios was given 75 million fucking dollars! For the retards I’ll do the math:
        2012 – 2010 = 2.
        75/2 = 37.5m
        37.5m / 100k = 375

        Therefore assuming a utopian society in which everyone was equal and made 100k and none of those 379 were lowly testers, officer workers or general contract grunt labor, everyone walked with 200k for two years work. Now these ass-hats probably had some expensive office, and brought in meals and left ALL the lights and monitors and computers on every night as developers are apt to do. The point is if you shift around the money so that 100 workers made 50k and 100 made 75k as a rough estimate you are looking at around 15 million free to pay expenses and go into the pocket of founders and upper management. I know these are rough numbers but I’m positive, unless I see an itemized list of expenses, that a couple million found there way into poor shill(ing) and his other cronies.

        If someone doesn’t go to jail for this… well it would be business as normal in America wouldn’t it. Consider that while you get harassed for making a late payment on a credit card.

        • LionsPhil says:

          Now these ass-hats probably…left ALL the lights and monitors and computers on every night as developers are apt to do.

          Oh god, he’s an environmentalist too. We’ve got a winner here, folks.

        • Dammokles says:

          Apparently you’ve never heard of paying rent, advertising, and productions costs (for the console and boxed PC versions). You would be surprised how quickly you can burn through cash with a few TV spots.

          • Kadayi says:

            Indeed. It’s always amusing when all someone sees is salaries. $4 million a month with that many employees on staff isn’t a surprise.

  26. Brun says:

    It was my understanding that they did manage to pay back the state of Rhode Island, so thankfully taxpayers aren’t on the hook. That said, someone in the RI legislature (or “Economic Development Corporation”) should have realized that video games are an incredibly risky investment.

    • ReV_VAdAUL says:

      That was just the first part of the repayment scheme and it was a very small part of the whole loan.

    • drewski says:

      The loan was for $51-75m depending on milestones. Apparently they ended up using about $64m of it.

      Of that, about $2.5m was paid back in two installments. The next is due in six months; seems pretty unlikely they’ll make it.

      So taxpayers are on the hook for about $61.5m minus whatever they can sell the IP for if (or when) 38 Studios miss their next repayment.

  27. RakeShark says:

    I guess this was one “save” Schilling couldn’t pull off.

    • LifeSuport says:

      They barely made this last installment… there is millions more… in the cayman islands.

      • drewski says:

        I think you’re projecting. There’s no evidence of corruption here, just incompetence.

        • LifeSuport says:

          Since when are the two different? If you believe that try saying I didn’t know it was illegal and see how far that gets you. Ops! Sorry I stabbed you with a knife officers I had metrics your vest would stop the knife, I guess it was just incompetence.

          • drewski says:

            Umm…there’s a huge difference.

            If I take a kickback on a contract to award it to a particular supplier, that’s corruption. If I do my best to award a contract to the best possible bidder, only for them to end up going broke and leaving the contract unfulfilled, that’s incompetence.

            If Rhode Island gave 38 Studios the money and Schilling made off with the money to the Cayman Islands, that’s corruption. If Schilling spent it all trying to make his video game – however deluded that ambition was – that’s just incompetence.

            If you can’t tell the difference, take off your black and white spectacles. The world is grey.

  28. Skofnung says:

    Schmucks like Curt Schilling love to blame the personal failings of the poor for their own struggles, but there’s always an external cause when Job Creators fail.

    • LifeSuport says:

      Exactly. Where are the 390+ employees with pitch forks and torches outside his house as they would a snake oil sales man ripping off the local township.

  29. LifeSuport says:

    Shill (ing ) One who poses as a satisfied customer or an enthusiastic gambler to dupe bystanders into participating in a swindle.

    Shit, guess we should have saw this coming.

  30. Jayson82 says:

    So who owns Kingdoms Of Amular now? i mean its still selling right? So wheres the money going?

    If these guys are owed severance pay should they not get it from who ever is getting the cheques from who is still selling the game?

    Even if the physical sales have slowed or stopped because of this you still have digital sales still on going i am guessing.

    • Joshua Northey says:

      A failing company like this has crediotrs up the wazoo. It has marketing bills it hasn’t paid, printing bills, electric, employees, taxes, loans it hasn’t serviced. its not like there is some huge pile of money somewhere. If there were it would still be an ongoing business.

    • ReV_VAdAUL says:

      38 Studios still own the IP for now, when they default on loan payments their creditors will gain control of it via bankruptcy. Which means likely RI will own part or all of it once they fail to make the next payment.

    • Apolloin says:

      I imagine that they are frantically trying to avoid bankruptcy. Right now, they haven’t filed yet and therefore still own all the stuff they own. They’ve ditched all their employees and closed up all their studios – they’ll probably try and make a deal to sell the IPs they have for Amalaur to some interested third-party.

      • drewski says:

        They can’t sell the IP, it was used as collateral for the Rhode Island loans.

        • Apolloin says:

          Well, I guess the State of Rhode Island will be looking for a purchaser for the IP, then.

    • Moraven says:

      I think the State of RI gets it per the loan agreement.

  31. Torgen says:

    So, when’s the gubernatorial election in Rhode Island? If not this November, perhaps a recall petition is needed (like that will ever happen.)

    • Joshua Northey says:

      The governor who did this is already gone, and the top two officials in charge of this program have stepped down. So the pain has been spread.

      Of course they will all probably still have no trouble getting new jobs, but that is the advantage of being part of the upper class. Your s8&^% don’t stink!

  32. Moraven says:

    Would not be surprised if some Asian MMO developer buys up the code for cheap and turns it into some F2P game.

  33. AltF4 says:

    Someone wake up Smed from SOE, Vanguard 2.0 here it comes lol

  34. seventil says:

    I hate to wish doom and gloom on someone, but this is entirely justified. 38 Studios went from “Let’s make an awesome (albeit Fantasy) MMO with Todd MacFarlane and RA Salvatore to …. “let’s make a generic Fantasy game with no real story”. And the name. The name was just horrible.

    Perfect example of flushing potential and resources down the drain. It could have been so much.

    • ichigo2862 says:

      Really? Then I hope you never find yourself without a job because of arbitrary reasons other people deemed worthy of you losing your job. Because losing a job is horrible and I wouldn’t wish that on ANYONE. Except rapists maybe. And Hitler. Yeah, him too.

  35. Ministry says:

    What the hell were they thinking hiring so many employees? They sure took a huge risk in taking that 75 million loan. Did they expect KOA to sell 5 million?

  36. Secundus says:

    kingdoms of amalooking for a new job

  37. LifeSuport says:

    The last thing I’m going to say is to those supporting 38 Studios, unless you are making 100k+ a year at which point you are in the “club” and can move when the country/state fails unless you are mortgaged up to your ass living the American Dream, Wake The FUCK UP!

    You are paying for this every-time you pay taxes. And don’t think this won’t be written off and a Federal marker meaning we’ll all pay, again.

    I guess, give me your address and I’ll come and take all your shit since you don’t have a problem just handing it over… ppfff

    • Joshua Northey says:

      I don’t think I have seen a single person here “supporting” 38 studios. Drewski and I have been explaining to people their misconceptions about how businesses work. But you really need to turn down your “activist proletarian” goggles and get in touch with reality.

  38. ichigo2862 says:

    Sad news. Best of luck to all affected.

  39. thebigJ_A says:

    “had Rhode Island governors”?
    “A Rhode Island governor”?

    A governor is the head of a state. There’s only one Rhode Island governor.

    Silly foreigners. And after us Americans go to the trouble of making sure we know everything about you guys. ; )

  40. kebabmanlyman says:

    Well, there goes my hope for an Amalur Patch…

  41. jhng says:

    That’s really sad news for all the 38/Big Huge folk and their families — I will be keeping my fingers crossed that they all find other, better work quickly.

    This also highlights to me how weirdly topsy-turvy our world has become. At root, a company is a group of people coming together to leverage their collective abilities and be more economically powerful in aggregate than they could be individually.

    It’s quite bizarre, when you think about it, that we have come so far since the development of corporate legal personality in the C18th that not only is it now meaningful to talk of a company laying off ‘all’ its staff but also totally accepted as part of the natural order.

  42. Gongsun Zan says:

    I wonder how much better the game would have been *without* Salvatore and McFarlane (and presumably their fat celebrity paychecks). Salvatore hasn’t been relevant since like the nineties, and his inability to move beyond cookie-cutter fantasy tropes shows in spades.

    My only knowledge of McFarlane is that he did Spawn, and as a result I would have expected the world to be a lot darker at the least. Instead it looked just like Fable, with none of the character or monster designs standing out in the slightest.

    In the end, I can’t really justify having the creative input of either when the end result is so generic.

  43. MythArcana says:

    Unfortunately, we’ll be seeing a LOT more of this happen with current PC gaming trends in the following year or two. You can’t even make a false move with your business model with the economy the way it is. Pumping out console-streamlined titles ain’t the answer; the market is saturated with them as it is. Then go to a console-streamlined MMO afterward, though? *shakes head*

  44. phr0stbyt3 says: