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Reckoning dev lays off entire staff - Report

[UPDATE]: Source says beleaguered 38 Studios and Big Huge Games sent out pink slips to all employees, believed to number close to 400. Rhode Island governor calls Kingdoms of Amalur a "failure."

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It appears 38 Studios and its subsidiary Big Huge Games are no more. The Verge and Joystiq heard from sources today that all employees at Curt Schilling's Providence, Rhode Island-based and Maryland-based development studios have been let go. The company put out just one game in its lifetime, February's well-received role-playing game Kingdoms of Amalur: Reckoning.

All 38 Studios staffers are out of work, according to the report.
All 38 Studios staffers are out of work, according to the report.

38 Studios employed 379 employees full-time as of mid-March, according to a report from last week. Employees at the company had not been paid since May 1 and lost health care benefits today, according to Joystiq. As of press time, 38 Studios had not responded to GameSpot's request for comment on the matter.

Troubles at 38 Studios first came to light earlier this month, when reports from the Rhode Island government indicated that the company had failed to make a $1.125 million loan payment to the state's Economic Development Corporation. The studio eventually made the payment, but it also enacted a round of unspecified layoffs. The company's CEO, Jen MacLean, left the studio in March, with senior vice president of product development John Blakely heading out just this month.

The fate of 38 Studios' massively multiplayer online role-playing game Project Copernicus is unknown. Rhode Island governor Lincoln Chafee recently revealed the title was being readied to ship in June 2013. If 38 Studios decides to sell its Amalur intellectual property, it can expect to get $20 million for it, according to one industry analyst.

38 Studios purchased Big Huge Games from THQ in 2009. It is unclear what will happen to the Kingdoms of Amalur: Reckoning sequel that Schilling confirmed was in the works earlier this year. The original sold 1.2 million copies during its first 90 days, outperforming publisher Electronic Arts' estimates, according to Schilling.

[UPDATE]: In a press conference this afternoon, Governor Chafee explained that the state had not been informed of the pending layoff of 38 Studios' entire staff. In explaining how the studio hit the skids seemingly overnight, Chafee explained, "The game failed. The game failed." He added that Kingdoms of Amalur: Reckoning would have needed to sell 3 million copies just to break even.

Additionally, Rhode Island's WPRI has a copy of the mass layoff email that was sent to 38 Studios employees. It reads:

The Company is experiencing an economic downturn. To avoid further losses and possibility of retrenchment, the Company has decided that a companywide lay off is absolutely necessary.

These layoffs are non-voluntary and non-disciplinary.

This is your official notice of lay off, effective today, Thursday, May 24th, 2012.

Got a news tip or want to contact us directly? Email news@gamespot.com

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gtadude26

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Edited By gtadude26

i thought kingdom of amalur was a good game it was big, it was long and it's combat system was better than skyrim

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Astarsis

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Edited By Astarsis

I don't get it, 3 million copies would be 1000 peoples for one year with salaries at 100K$ - I doubt they paid that much. I got an impression someone left with a big stack of money in their pockets, just because they could. I hope the matter will be investigated.

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strayfies

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Edited By strayfies

They overcooked a turkey, then fired the kitchenware. I sincerely hope the governor, taxpayers and now out-of-work staffers can find some kind of justice from these toxic decisions.

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KTfreak4Jesus2

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Edited By KTfreak4Jesus2

It's like pandemic studios all over again :(

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jakesnakeel

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Edited By jakesnakeel

Such a talented team. This is a board room failure.

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SadPSPAddict

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Edited By SadPSPAddict

Never good to hear

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2x4b96123

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Edited By 2x4b96123

putting all the resources into the The Kingdoms of Amalur MMO was a fail. Who the hell made the decision that they'd roll it all out instead of just putting out the small rpg first to see how it went without putting all the eggs in the MMO basket!?

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soulless4now

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Edited By soulless4now

Shame that all of them are out of a job. :(

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uglypinkmoose

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Edited By uglypinkmoose

depress!

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Takeno456

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Edited By Takeno456

Regardless if one liked the game or not it is still sad to see a new company who took a chance on a brand new IP fail. With all of the 3s 4s 5s and 6s we see tacked onto our games and all of the remakes coming out it really is sad to see new talent die. Also when did getting 1.3 million copies become a failure? Man money really has skewed how we view success now. Anyway good luck to all the 38 studio workers.

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Shantmaster_K

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Edited By Shantmaster_K

I havn't played this game, but I want too. It looks good. Sad day for 38 Studios. Hopefully they can find a way to come back.

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vadagar1

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Edited By vadagar1

btw I think the "politicians" and the big bosses got off rich and fat, as usual, hope they save up that 30 silver because they sure gonna need it soon.

and yah sure the governor was "shocked" *rolls eyes*

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vadagar1

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Edited By vadagar1

hmm maybe they should have started small .....

I mean I don't know...

at least they have their life and that's whats important, everything will be alright in the end.

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ClaudiusCaesar

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Edited By ClaudiusCaesar

This developers are losing their jobs and right now some people are buying this game used.

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cowkiller321

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Edited By cowkiller321

Didn't like the game at all. It looked to me like some offline mediocre MMO. Sad story though :/

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4quarters

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Edited By 4quarters

3 million copies to break even....crazy numbers.

The next gen of systems is doomed as costs rise...

379 employees for a new company first game....crazy

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Letho3334

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Edited By Letho3334

Time to move from Rhode island.

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DeadrisingX1

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Edited By DeadrisingX1

That's just saddening.

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xMoonDevilx

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Edited By xMoonDevilx

Game wasn't for me...talented workers though, definitely give them that for first out of the gates game release. Hate they have to suffer from it. I think they will get absorbed into other companies though...hopefully..as their work can and should be considered high value and development.

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rasputin177

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Edited By rasputin177

If they would have made a patch to fix the game before rushing out new DLC I might still be playing the game along with others. So much went wrong here its a shame because the people who actually made the game are the ones who did things right and they got screwed by the higher ups. Schilling is such a bitch. The sad thing is other then maybe a hurt ego he escapes unscathed.

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Buzduganjr

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Edited By Buzduganjr

Holly molly! this is sad very sad for the game developers...now who's gonna update the bug and fixes we reported??

Oh man i really enjoyed the game :) and is sad to see this news.

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Henninger

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Edited By Henninger

That sucks.

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JoshX042

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Edited By JoshX042

Sad story

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rasputin177

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Edited By rasputin177

The game did not fail. You failed gov Chafee you failed and so did Schilling.

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nyran125

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Edited By nyran125

what a joke...

lesson, dont make something you cant afford and if you do..pay the friggin workers and if you cant, go to prison.

I think workers of the game industry should call for a new way of paying them. half up front and half when its over. A game developer makes what $45'000-$80'000 a year or something? its not as much as you think. They needed to come up with around 18 million to pay 300 workers, $60 x 1.2 million copies sold is $72million , they SHOULD of been paid. This is grose.

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andizzlee

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Edited By andizzlee

wow this is fucking sad.

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rarson

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Edited By rarson

This sucks, but it's a great example of why the government should have no business investing other people's money into things that they have no clue about.

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dmdavenport

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Edited By dmdavenport

Why couldn't the terms of the loan be re-worked to save the company? I'm sure the citizens of Maine would've preferred that to more people on unemployment.

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rcarp711

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Edited By rcarp711

KoA:R was far more arcadey than I had hoped, so I was quite disappointed. Just wasn't my cup of tea. Still, how do you sell 1.2-million copies of your first game in the first 90-days and go belly up? You hire talent like Salvatore and McFarlane and spit out a simplistic, button-mashing, half-hearted facsimile of an RPG, I guess.

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jbahari

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Edited By jbahari

Unfortunate. Hopefully the folks laid off can bounce back and find work quickly and sure they will. What this means for the world of Amalur, it seems no ones for certain. It is really scary how the game studios are here one minute and gone the next. Harsh business.

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FreedomPrime

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Edited By FreedomPrime

wow, what a shame. that was such a good game and you can tell that studio had something special on their hands.

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JimmeyBurrows

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Edited By JimmeyBurrows

Once again I'd say that relocation loan killed them off... Why the hell did they take it and where did the money go... If they'd stayed where they were and made the game they'd probably still be in business.

Must be some really shitty people in high up places, all staff layed off and no one payed so they could pay off a tiny part of the loan... Lame.

Best of luck to everyone who lost their jobs.

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TriumphantToad

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Edited By TriumphantToad

I feel like they'd just make more money if the games weren't $60. I mean...if it was $30 or even $40, I (and I'm sure many others) would probably never buy a used game again. 100 x $40 > 50 x $60...

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CTR360

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Edited By CTR360

amalur its good game

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TriumphantToad

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Edited By TriumphantToad

I don't get it...the game didn't do amazing, but I thought it did relatively well...tons of games do way worse and their companies stay in business...

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Grbonjic

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Edited By Grbonjic

Too bad ... Not that I'm a fan, but it's a sad thing that a good game like that gets such a bad rep.

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Ford_Cruller

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Edited By Ford_Cruller

That's unfortunate news - my thoughts go out to the former employees. I thought the game was pretty fun, just tough timing with so many people experiencing rpg fatigue after Skyrim.

On a side note, it's sad to see a new IP manage to sell over a million copies and still not be profitable. Sounds a bit like mismanagement.

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topsemag55

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Edited By topsemag55

If 38 Studios had just patched the level cap, I would have purchased the latest DLC. As it is, you reach the level cap before the game finishes. Becomes pointless to play a RPG when the XPs stop.

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kattamuuran

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Edited By kattamuuran

leave it to a jock to run a video game company and this is what you get.

but seriously, too bad for the workers, and despite what the legion of trolls say, i thought the game was super fun.

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--Rob--

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Edited By --Rob--

Tell ya who I really feel sorry for... the taxpayers of RI.

I hear Schilling got his 30 mil back though.

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ticklemekruger

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Edited By ticklemekruger

@--Rob-- No brains, but a lot of shet!

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Bozanimal

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Edited By Bozanimal

@--Rob-- According to Governor Chafee, Schilling invested every last dime into the company. Schilling was all-in, according to current reports.

Source: http://www.boston.com/businessupdates/2012/05/24/curt-schilling-studios-lays-off-all-staff/Oz242vVpcy6FLRwegTtkOP/story.html

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ggregd

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Edited By ggregd

@Bozanimal @--Rob--

"Rhode Island has already provided the company about $49 million of the $75 million loan to 38 Studios."

So 38 Studios was burning through money with no end in sight and the state panicked because of the missed payment and cut off the rest of the loan. End of story for 38 Studios. Either things were REALLY bad at the company or "loan guarantees" don't mean the same thing in RI as they do everywhere else.

I don't think Reckoning needed 3 million sales to be profitable, I think it needed them to keep the whole 38 Studios ship afloat. How much mismanagement does it take to spend all that money, plus all the money Schilling and the investors put in with nothing to show for it, as far as potential investors are concerned? 6 years seems like long enough time for 300+ people to develop even an MMO if you have even rudimentary project management skills.

It'll be interesting to see what the truth was.

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revs0up

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Edited By revs0up

something's funky here. RI didn't even deliver all the money yet and they freak out over one 'missed payment '. then suddenly the relocation loan turns off and the entire bloody company gets laid off . i aint buyin' it . not on how it sold /is selling.

first thought that comes to mind is - RI freaks and pulls the relocation loan , the studio replies in kind with their own F U ,and re-relocates (i.e. goes back where the climate suits their clothes )

this game can make money for a few years easy on its own.not to mention add- ons , MMO etc. seems all too quick, slick and clean.

along with nobodies asking for money . not RI ,not the employees ,Salador ,EDC, etc....lol

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ggregd

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Edited By ggregd

I find it inconceivable that the state and the company couldn't have worked something out to keep them afloat until the money started coming in. It really seems like there was a generous helping of incompetence in the leadership on all sides here. Considering it's Rhode Island I wouldn't be surprised if political corruption wasn't involved somehow. I want to hear details from the execs who left.

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Bozanimal

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Edited By Bozanimal

If you're looking for background on this sad story, you can view the summary here: http://l.gamespot.com/JIrXqy

You can also follow Rhode Island reporter Ted Nesi on Twitter @tednesi , who has been the primary source of information on this developing story for the rest of the media.

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onemeg

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Edited By onemeg

Wow, laid everyone off via email...that is a new low.

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nburdine

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Edited By nburdine

That was certainly a twist of fate.

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