The Xbox division of Microsoft has declared the shutdown of four Bethesda studios under the strategic repositioning plan, emphasizing only the titles with high impact and investing in key franchises. The decision was exposed through internal communications via a mail which indicates a change in the resourcing policy within the biggest gaming giants.

Studio closures and game impact

Among those studios that are the victims of the reorganization is Arkane Austin, which is known for games such as Redfall. The closure of Arkane Austin has occurred right after the unsatisfying failure of ‘Redfall’ and Microsoft canceled the additional work on it. The company will compensate players who already bought the content for ‘Redfall’.

Tango Gameworks, the Japanese studio praised for their releases ‘Hi-Fi Rush’ and ‘The Evil Within,’ will be shutting down as well. This is an illustration of Microsoft’s decision to optimize the use of resources and concentrate only on high priority projects. Moreover, Alpha Dog Studios, which developed the ‘Mighty Doom’ game, and Roundhouse Games will close as their team is transferred to ZeniMax Online Studios to contribute for ‘The Elder Scrolls Online’.

The head of Xbox Game Studios, Matt Booty, presented the genuine background of these closures in an email which stated that the decisions were based on a need to “reprioritize titles and resources”. A large part of employees are expected to get fired as a consequence of these closures. Booty highlighted the future of Bethesda by showcasing Microsoft’s dedication to investing in the company’s established brands with the aim of generating fresh intellectual properties.

Outlook and Xbox future plans

Microsoft reaffirms its dedication to Bethesda as the pillar of Xbox ecosystem despite these closures. Future plans for ‘Starfield’ and ‘The Elder Scrolls Online’ expansions, as well as the ‘Indiana Jones and The Great Circle’ from Machine Games that is about to be released, show that the company remains focused on the future. Microsoft seeks to rely on the knowledge of retained studios like Arkane Lyon and id Software to diversify their gaming assortment and look into new ideas. 

This re-alignment highlights the fluidity of the gaming sector and therefore strategic adjustments are necessary to enable the ecosystem to sustain competition by locking in to core areas of development. While these closures impact employees and business operations, the brand aims to cut redundancies and attract returning customers through the existing brand names in a plan to generate future growth.

Source: X (formerly Twitter)

Xbox is poised for further developments in 2024, including the release of Starfield: Shattered Space and add-ons for Fallout 76 and The Elder Scrolls Online which shows that the company is dedicated to providing enjoyable experiences. Microsoft’s recent strategic moves follow a wider trend to keep up with the latest industry trends and remain relevant for a long time.

The cessation of these studios by Microsoft is evidence of a tactic that targets bringing the resources together and plowing them into the production of highly effective games only. While the job reductions are still there, the emphasis on innovation and providing different gaming experiences in a global audience is preserved by Microsoft.

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