Many studios that contracted with Xbox or were engaged in outsourcing for major projects have suddenly lost orders and investments — now they will have to urgently pivot.
The information comes from Irish journalist Lex Luddy on the Rewinder podcast, based on insider reports from industry colleagues.
“The point is that the layoffs are far more extensive than the number reported by Microsoft, because far more indirect cuts go unnoticed. People are saying: folks are in a panic.”
According to her, contract development studios have proven particularly vulnerable: for instance, Iron Galaxy, which worked on Tony Hawk, or Virtuos, involved in the Oblivion remake. Their contracts were pulled en masse and funding was withdrawn, which inevitably leads to layoffs.
Among the confirmed cases is the cancellation of funding for Romero Games. Meanwhile, critics warn that the worsening situation will impact the future of Game Pass.
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Cover author: Cover source: TheGamer