The full cost of Microsoft’s most recent round of layoffs is becoming clear, as Rare loses one of its most experienced developers.
The sweeping job cuts at Microsoft might not have been a surprise but a day after it happened, we still have little in terms of confirmed details. Although the company in general has laid off around 9,100 people worldwide there’s no official confirmation of how many roles have gone at Xbox (although we do know that Xbox figurehead Phil Spencer is not leaving).
All Microsoft has said, in a comment to Game File, is that less than half of the company’s overall layoffs were at Xbox. That would seem to put the figure at around 4,000 – as Microsoft’s gaming division bears the brunt of the job cuts.
What makes that figure even worse is that Microsoft already laid off 650 Xbox staff in September last year and 1,900 a few months before that. That puts the total number of job losses at over 6,000 people.
It was always guaranteed that there would be layoffs as a result of the acquisition of Activision Blizzard, and Bethesda before that, with the business average being around 5 to 20% of the workforce, as companies look to cut costs and remove people with similar roles.
Activision Blizzard had around 13,000 employees as of 2022 – which would equal 2,600 job cuts at the maximum of 20% – so what’s going on here is far more than just eliminating duplicate roles.
Microsoft’s games business is being downsized and reconfigured, although it’s unclear exactly what their goals are now or what Xbox is going to look like when all the dust has settled.
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The upcoming new generation of hardware, which Microsoft has already started hinting at plans for, will complicate things further, while many suspect that this week’s new round of layoffs will lead to an increasing reliance on AI tools.
In recent years, Microsoft has been pushing AI throughout its business and CEO Satya Nadella is known to be a keen advocate of the technology, even if it’s still unclear exactly how it will be used for gaming.
It’s not certain that Microsoft will ever go into detail about what has happened this week, and who exactly has been laid off, which means at the moment most of the information is entirely unofficial.
Nevertheless, VGC reports that veteran Rare developer Gregg Mayles has left the company, in part because he was director of the now cancelled Everwild. Mayles has been at the company since the late 80s, and worked on Donkey Kong Country, Banjo-Kazooie, Viva Piñata, and Sea Of Thieves.
Many other staff have reportedly left at the same time, leaving few from Rare’s heyday in the 80s and 90s. Microsoft also cancelled the reboot of Perfect Dark, as part of the layoffs, but although the original was a Rare game the reboot was being made in the US by The Initiative – which has now been shuttered completely.
ZeniMax Online Studios, the makers of The Elder Scrolls Online, have not been shut down but a new, unannounced project, that’s been in development since 2018, has. This has led to Matt Firor stepping down as head of the studio.
More details will surely come out in the coming days and weeks but after contacting Microsoft they stated they have nothing to share beyond this brief statement: ‘We continue to implement organisational and workforce changes that are necessary to position the company and teams for success in a dynamic marketplace.’
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