Microsoft announced a new wave of Xbox reboots this week, and it also made some interesting announcements. In particular, it was announced that Rare and World’s Edge will become part of Activision Blizzard, while Obsidian will fall under the control of Bethesda. Several Xbox Game Studios teams have merged, and some have been significantly reduced or separated.
Posted by renowned analyst Christopher Dring on gaming business He talks about stuff that’s going on with the Xbox team.
- Double Fine, Compulsion Games and Undead Labs. Xbox ditched the three studios, returning them to independence. For its part, Undead Labs had previously discussed selling UK-based Splash Damage, but the deal never materialized.
Xbox dropped Double Fine (Psycho), Compulsion (South of Midnight), and Undead Labs (South of Midnight), which have all returned to standalone titles. At some point, Undead Labs should move to British developer Splash Damage (Gears Tactics), which is backed by Emona Capital. However, the deal never came to fruition.
- Ninja theory. They tried to sell the studio twice, but both deals fell through. Potential buyers were scared away by the high cost. Employees are currently negotiating, and Xbox expects to find a new owner for the studio in about six weeks.
Ninja Theory also had two buyers at one point, but both deals fell through. I know two investors who are looking at Ninja Theory, and both told me that the cost of the team was high, which ultimately put them off. UK law dictates that Ninja Theory will not close today. However, staff are undergoing consultation and it will take around six weeks for Xbox to find a new home for the Cambridge team. I’ve heard that its next game, Senua, is a “significant improvement over Hellblade 2,” so here’s hoping it finds a new owner.
- Akane Lyon. Xbox also abandoned the studio. Negotiations with Arkane Lyon employees will continue until the end of 2026.
The fifth studio Xbox abandoned was Arkane Lyon. Consultations with the studio will continue until the end of the year.
- Rare. After the cancellation of Everwild and layoffs, the studio was able to retain some employees by reducing outsourcing and moving developers to Sea of Thieves. However, she is now working on other projects as well. Derling also recalled that Activision had wanted to acquire the team.
Rare is the company behind Sea of Thieves, a successful pirate game whose numbers have been declining over the past few years. […] As a result of the move to Activision, Rare’s core team underwent multiple layoffs. The studio is also working on other projects. In 2002, Nintendo owned 49% of the studio, with the option to purchase the remaining 51%. She refused to do so, sparking a debate over the purchase. Eventually, only two companies were left vying for Rare. Of course, one of them is Xbox. other? Activision Blizzard.
As for Obsidian, people are unhappy with it being part of Bethesda. Some employees feel they have lost the autonomy and freedom they were promised. But the games the studio released last year, while of high quality, didn’t perform as expected. Over time, the opportunity to co-develop a major franchise like Fallout may be seen as a positive outcome.
Of course, the biggest news is that Activision is taking over Halo. This isn’t about cost-cutting, it’s about getting Halo running again. Halo was once one of the world’s leading shooter series. The release of Halo 3 in 2007 was the largest launch in entertainment history at the time. Today, only the remnants of that success remain.
Let’s remember that Halo Studios hasn’t been dissolved yet, but it’s already had massive layoffs.