In a shocking development, Microsoft’s Xbox Game Studios announced the closure of four studios under the Bethesda Softworks umbrella. The most prominent studios on the chopping block are Arkane Austin, responsible for critically acclaimed games like Prey, and Tango Gameworks, known for The Evil Within series and the recent hit Hi-Fi Rush.

The news comes just a few months after Microsoft implemented significant layoffs across its gaming division, primarily targeting recently acquired Activision Blizzard.

This latest decision has many questioning Microsoft’s long-term strategy for its gaming business, particularly considering the positive reception for Hi-Fi Rush, which many consider Xbox’s strongest recent release.

Studios Affected

• Arkane Austin (Prey, Redfall): Despite critical praise for Prey, Arkane Austin’s recent title, Redfall, fell short of expectations. The studio’s closure signifies the cancellation of promised post-launch content for Redfall, including additional heroes as part of the game’s Hero Pass.
• Tango Gameworks (The Evil Within, Hi-Fi Rush): Founded by industry legend Shinji Mikami, Tango Gameworks consistently delivered critically acclaimed titles. The studio’s closure is particularly surprising given the recent success of Hi-Fi Rush.
• Alpha Dog Games (The Mighty Doom): This mobile game developer is known for The Mighty Doom.
• Roundhouse Studios: Originally formed from part of Human Head Studios, Roundhouse Studios will be absorbed by ZeniMax Online Studios to work on The Elder Scrolls Online.

Reasoning and Repercussions

In a letter to staff, Xbox Game Studios head Matt Booty cited “reprioritization of titles and resources” as the reason for the closures. The goal, according to Booty, is to “invest more deeply in our portfolio of games and new IP.”

However, this justification clashes with the recent closures and layoffs, leaving many sceptical about Microsoft’s commitment to fostering creative diversity within its studios.

The closures have sparked outrage from developers and gamers alike. Dinga Bakaba, creative head of Arkane Lyon, expressed his disappointment on social media, urging Microsoft to prioritize the well-being of its developers and foster a more creative environment.

Shinji Mikami, founder of Tango Gameworks, has also announced his departure from the studio just before the news broke out.

What it Means for the Future

The decision to close these studios raises questions about the future of Arkane as a whole. While the studio has produced critically acclaimed titles, including the GOTY-winning Deathloop, commercial success has remained elusive.

This situation has led some to believe that Microsoft’s gaming division is increasingly resembling Activision, prioritizing blockbuster titles over creative risks.

The future of Xbox Game Studios’ strategy remains unclear. While recent studio acquisitions demonstrate a commitment to expanding their portfolio, the closure of studios with passionate followings paints a different picture.

Only time will tell how these decisions will impact the Xbox brand and the gaming landscape as a whole.