Brad Hilderbrand explains the reason behind the recent Xbox studio closures

There are two reasons why all those Bethesda studios closed, and neither of them have anything to do with Bethesda (directly)...

Game Pass and Activision.

[Christopher]

The guy confirming what we've all (well, most of us) been saying since the latest purchase.

[crazyCoconuts]

Remember the relatively common counter that went something like "I'm sure you arm-chair CEOs know better how to run a company than the biggest company in the world"?

I mean - there's a lot to running a company for sure, but on this topic it's hard to understand how Phil and team didn't see this coming.

[RNTody]

Phil and team knew it was coming and planned for it. It's not even a conspiracy, it's simply the business of cutting costs and superfluous studios after a major acquisition. They don't give a damn about Tango Gameworks or other small creative studios that won't recoup their losses. They don't care about investing in this industry. They have no interest in risky and expensive new IP. They are only interested in profiting off ownership of Bethesda IP, Call of Duty and Candy Crush.

I guarantee you that not one single game under their banner will improve or become bigger and better.

Welcome to the Xbox family, what a pathetic joke.

Anyone who continues to support this, enjoy your future, because this is it. Ninja Theory is next, and Perfect Dark after that.

[Christopher]

Especially not with the evidence of tons of existing movie streaming subs out there and how they fail to make a profit with over 100m users each quarter.

[fr0sty]

Xbox releases more first party studios than first party games.

[Crows90]

It's actually really simple. CEO don't have it hard at all...they make decisions that everyone else has to accomplish. It's the actual low level employee leadership that makes things work well.

Besides that it is obvious when you use simple math that something was going to break.

[Lightning77]

Apparently they're debating if they wanna put the new Cod on Gamepass or not.

Either grow GP with Cod or don't put it on GP and grow the revenue the traditional way while GP will suffer.

The mess that MS puts themselves in.

[badz149]

LOL the cheerleaders for the ABK acquisition were all cheering for CoD to be on GP day 1 and they were adamant that Jim Ryan was scared because of THAT and was fighting for the survival of the PS brand if CoD is taken away or given day 1 on GP. hahaha...now suddenly MS is unsure if they wanna put CoD on GP day 1??

isn't this false marketing? they said ALL (not some) 1st party xbox games will be released on GP day 1 and CoD is now 1st party starting last year! it's right there still on their website.

https://www.xbox.com/en-US/...

lawsuit time??

[Outside_ofthe_Box]

@badz149

People were being blind fans. Things is if you look at things objectively and logically since inception, gamepass from a business perspective was never going to be good idea unless you had hundreds of millions subscribed, which Microsoft was never going to get in a timely manner.

People kept pointing out the cons and people kept having their hands over their ears. I wonder how guys like Orchard and Septic who were rooting for the acquisition to go through like people do when their team makes it to the Superbowl are receiving this news lol

[ziggyzinfirion]

@badz149

Looks like MS removed the page.

[VariantAEC]

@badz149
And it's gone now... that was fast.
Maybe quote it next time?

[mkis007]

Just think its a bit insane to close their ?only? Good japanese studio...so much for caring for that market.

[Crows90]

And a great studio too....love evil within...still have ghost wire Tokyo in my backlog but will get to it soon enough.

[XiNatsuDragnel]

I'm not surprised Microsoft guys are crock nuff said

[isarai]

Honestly i think Bethesda needs to buy themselves out of zenimax/MSs hands and do their own thing, i honestly think that would fix a lot of issues and save them from a potential closure.

[Zeref]

There's a reason they sold in the first place. And Bethesda is not closing anytime soon lol. As much as I hate the studio closures. They were all small studios 2 of them were mobile studios.

I think these are growing pains and Xbox will get back on track. But they're not getting any more passes.

[jwillj2k4]

I’d like to see your reaction to being growing pained out of your job after the launch of a successful product.

[Mr_cheese]

Excuses, Excuses, excuses.

If growing pains have been happening for the best part of a decade, they're not growth.

[XiNatsuDragnel]

Zeref nii San
I'm sorry but xbox has been rightfully bashed due to constant incompetence

[romulus23]

Yet you literally just gave them a pass, being "small studios" or "mobile studios" is irrelevant. There's no excsue for closing Tango, none. They praise the game, they PR talk about it's the kind of game the company needs and yet they shutter the developer, that's foul on every level.

[Chevalier]

Ah Zeref head in the sand like a idiot. Gamepass is a absolute failure like we all told you. Nothing at this point will turn this around. It's not growing pains, the growth is done. Even streaming with 100 million subscribers can't turn a profit and you think Xbox with Gamepass will turn it around? Lol.

It's not a coincidence that Xbox stopped announcing Xbox Gamepass numbers just like they stopped announcing Xbox One hardware numbers and no Series S/X numbers which are behind the Xbox One even.

Remember when we said Xbox customers don't buy games?! Lol. Well this confirmed literally everything we told Xbox fans that said Gamepass was very profitable? Sorry revenues and lack of profit suggest otherwise

Can't wait to see your reaction when their 2nd round of closures happens. Perfect Dark studio and Ninja Theory will next.

[Barlos]

No, this isn't growing pains. Xbox has been on the scene for over 20 years.

This is Microsoft not being content with competing, they want to own and control the industry. Buy out as many major devs/publishers as possible so that they own all the IPs. It's only the IPs they care about. Not the Studio's, not the people. They're an insidious, cancerous company and are the worst thing to ever happen to the gaming industry.

[shinoff2183]

There's no getting back on track. Their releasing games on ps5. That's a wrap.

[Tacoboto]

Bethesda greenlit Redfall, launched Fallout 76 in the condition it was in (and the fiasco with the bonus bag), and spent all that time on Starfield finishing it as it was with that same engine. Wolfenstein Youngblood exists because of them too, not Microsoft.

Are you *sure* leaving them alone would actually result in a better outcome, not just a different one?

[isarai]

A lot of this excessive monetization, and GAAS crap started when Zenimax decided to start looking for a buyer. Not a coincidence that there was a sudden shift in prioritizing profits above quality or even coherence at the same time. They wanted big numbers to attract buyers, now that they've been bought, MS wants exactly what they were baited with.

However even under Zenimax they made enough to self publish sometimes, so i would imagine it's not too far fetched that they could pay their way into independence if they REALLY wanted to.

Also even people at Bethesda and Arkane were hoping MS would cancel the game as again, they were forced to make something they didn't want to make.

[mkis007]

Havent seen any decisions since the buyout that lead me to believe MS knows what to do with them either . Easiest one would have to be the fallout 4 upgrade...with minimal effort it could have been a big win for leadership...but nope we got a standard Bethesda release for a patch.

[shinoff2183]

Tacoboto. Bethesda greenest it to be made. Ms greenest the release. Remember phil telling us he don't know what happened because it polled well behind closed doors. Nice try on that one with redfall. In the end it was on Ms not Bethesda

[Einhander1972]

Ah, we can see how the Microsoft media machine works.

Every article I read now is some kind of attempt to shift the blame off Microsoft and paint them as the victims or convince people that Microsoft mistakes were just some kind unforeseeable unfortunate twist of fate.

The shills are out in full force today.

[Christopher]

This is not at all what this article is saying. It's saying that honest and useful studios are getting closed because of big money deals elsewhere and the faults with game pass as a model.

[Einhander1972]

I understand what the article is about.

It's a deflection, it's a putting the cart before the horse article.

Let me tell you how this problem wouldn't have existed in the first place.

Microsoft not creating a service funded by subsidization and having the foresight to see that it would disrupt consumer spending habit to begin with. Then not buying Bethesda and undertaking costs for a service that was already failing to pay for itself because their own expectations of Game Pass having "billions" of subscribers was unobtainable from the very start.

And if you don't think that was the case go back to the article on the day Game Pass launched and read the comments from people from day one who foresaw that this would be an unsustainable model and would cause people to stop spending in the same way.

[Christopher]

***Microsoft not creating a service funded by subsidization and having the foresight to see that it would disrupt consumer spending habit to begin with.***

This article literally supports this opinion. He's not praising Game Pass or the ABK purchase.

[Einhander1972]

This is an explanation of why it failed, there is zero blame put onto Microsoft itself.

Yes, it talks about what went wrong, but it doesn't say Microsoft shouldn't have done it. It doesn't say Phil should have foreseen this outcome and stopped before it got to this point.

"convince people that Microsoft mistakes were just some kind unforeseeable unfortunate twist of fate"

[shinoff2183]

Thats what I took from the article. Maybe we're mistaken Christopher lol

It saying why it failed puts enough blame on Ms imo. Eben if they didn't come put and say fk Ms etc.

[Christopher]

***but you're seeing the impact; all those smaller studios making really interesting games are going to fall away, simply because as good as games like Hi-Fi Rush are, they're never going to make enough money to make up that $70B hole that Xbox now has to dig itself out of.***

If you see that as support or you explicitly just want people to end their argument with "and, in conclusion, Microsoft bad" then that's on you. This article does not support Microsoft's choices and highlights the faults. Nothing it says is good about these choices, even saying that putting CoD on Game Pass would be money losing for them because they've set themselves up for failure (and not putting it on there will drop subscriber numbers like crazy, meaning their Game Pass plans were shit to begin with).

No matter how you look at it, they're saying Microsoft made decisions that hurt the bottom line, force closures, and leave Game Pass in a situation where they lose no matter what they do. It's all negative.

[Einhander1972]

Christopher, if Microsoft hadn't made Game Pass and bought a bunch of publishers would this article even need to exist?

[Christopher]

***Christopher, if Microsoft hadn't made Game Pass and bought a bunch of publishers would this article even need to exist? ***

How is this an argument to anything being discussed? This is just as valuable of an argument as "if fish had stayed in deeper waters, they wouldn't have evolved to tetrapods, adapted to shallow water and then to land, and we wouldn't even exist and have to worry about game pass at all."

You're bringing nothing to this argument and then complaining that other people are highlighting the issues with Game Pass and spending tens of billions on studios because what we should be discussing is what it would be like if Microsoft hadn't done any of that.

Well, they did do it. Now pull up your big boy pants and join in on the discussion of what that has meant for the industry since then and, especially right now, how that is affecting the industry and game studios under Microsoft. None of us are able to go back in time and change what was done.

[Einhander1972]

Christopher, this isn't me not understanding what the article is about, it's you not understanding what I am saying.

If you want me to make excuses for Microsoft's bad decisions you're not going to get that or just agree with people who are doing that, it's not going to happen, nor are you going to convert me into thinking xbox "needs to exist".

Ya know what, maybe "Microsoft bad".... maybe their decisions ARE having a negative effect on the industry, and instead of deflecting from their actual actions and making excuses for them we stand up and say "no" "Microsoft is hurting the industry"

And maybe, just maybe, it was so obvious that this was going to be the outcome that even nobodies in comment sections on websites were able to easily predict this outcome, yet Microsoft did it anyway then kept doing and even when it became undeniable that it was having a negative impact on their business and and the industry itself, then they knowingly made even bigger purchases and caused more problems.

And the one thing you're right about is that I can't go back in time, but I CAN speak up and try to keep it from happening again...

Maybe if the people who were speaking up 7 years ago were listened too we wouldn't be having this discussion and Tango and Arkane would still be in business along with all the other people who have lost their jobs due to Microsoft's actions.

Do you like analogies?

What you're saying is like an alcoholic crashing their car then trying to explain it by saying it was caused by everything except the fact that they were dunk because they are an alcoholic and don't want to stop drinking.

[Chevalier]

Why the excuses here? Microsoft did one thing no other company can do which is subsidize Xbox with these insane purchases in hopes of suffocating the industry out in hopes to be the last one standing so they can charge whatever they want.

How are you excusing this crap even and putting your head in the sand here? It's pretty clear who is at fault here for the situation they built and put themselves in. It's them trying to push everyone around with cash that no one else can compare.

They knowingly did all that and now are trying to pretend the market is to blame? Lol. That is absolutely rich irony. That you can't see the forest for the trees here too.

[TiredGamer]

The article is essentially focusing the blame on MS. GamePass was a hail mary play to change the gaming paradigm and carve out a special niche for themselves, emulating the Netflix model, that might have led to MS becoming the leader in the long-term. Unfortunately, the subscriber growth isn't really there, and the model isn't really built to weather that lack of revenue. MS is now in a restructure mindset to figure out how they balance out their model in a way that can still make them money.

've always believed that GamePass was a high risk shot that had a very low chance of long-term success. But the problem with it, whether it succeeded or not, is that it accelerated the proverbial "race to zero" consumer expectation that ran its course in the mobile gaming industry in the late 2000s. When consumers start thinking that games should be "cheap" (as in through a $10/month all-you-can-eat subscription model), it turns the narrative against games being priced at realistic levels. So with the GamePass failure, they've not only sabotaged their market share, but they've impacted the entire industry and devalued the cost of game development to the average consumer. So now it's harder to develop mega-big budget games and to earn the revenue needed to pay for them.

[XiNatsuDragnel]

Again terrible excuses in the 1st place

[Christopher]

***If you want me to make excuses for Microsoft's bad decisions you're not going to get that or just agree with people who are doing that, it's not going to happen, nor are you going to convert me into thinking xbox "needs to exist". ***

No one is asking you to make excuses for Microsoft's bad decisions nor is anyone asking you to convert to anything.

***Ya know what, maybe "Microsoft bad".... maybe their decisions ARE having a negative effect on the industry, and instead of deflecting from their actual actions and making excuses for them we stand up and say "no" "Microsoft is hurting the industry" ***

Literally no one here is doing this. They're literally discussing how Microsoft's decisions have hurt the industry. Except you. You're rambling about why people aren't complaining about Microsoft when people are in fact complaining about Microsoft.

*** And the one thing you're right about is that I can't go back in time, but I CAN speak up and try to keep it from happening again... ***

Then perhaps actually add something to the conversation other than calling people shills when people are complaining about the decisions and repercussions of Microsoft's actions.

[Tacoboto]

Christopher, you're fighting a block wall here - Ein will continue twisting and contorting any remark to fit his self-created narrative.

[Einhander1972]

"Then perhaps actually add something to the conversation other than calling people shills when people are complaining about the decisions and repercussions of Microsoft's actions."

Cristopher, in no way is the author of this article complaining, they are explaining what happened it's literally the title. They never once say that Microsoft shouldn't have bought Zenimax or Activision or that Game Pass was a bad idea to begin with. They think the problem with Game Pass is that it didn't grow fast enough, not that it was a bad idea from the get go.

BTW this is his job title.

"Public Relations and Communications Leader"

What do you think a Public Relations and Communications Leader does to make money?

Edit: I have read a dozen of these articles that just started coming out in the last 24 hours that are trying to shift the conversation away from blaming Microsoft, the shift here and in several other articles is trying to say it just didn't gain subscribers fast enough, not that it was a bad idea to begin with that was doomed to fail or placing the blame on anyone.

It was all just an unforeseeable outcome, no one should be held responsible it was just a billion dollar oopsie that's costing thousands of people their jobs and has caused a downturn in the entire industries sustainability.

Oopsie!

[MrDead]

It's greed. MS has the IP's it wants now it's dumping the studios that it's raided, MS will still make money from Tango's games unlike the people that made them. If anyone follows MS outside of gaming you'll see this is what they do, buy companies take what they want consolidate some of the workforce and shut them down. I don't know why people are acting so surprised when this is Microsoft being Microsoft.

MS is a three trillion dollar company, if it enters a market it has no need to compete, they take what they want and with the financial influence it can bypass laws that are meant to protect the consumer and the workforce. Just look at how they are cornering the AI market right now with buyups and investments.

[shinoff2183]

Mr dead spot on as fk. Ms has been doing this it's whole time around.

[jwillj2k4]

he just clarified that game pass is a fucking Ponzi scheme.

[jznrpg]

Yep. Many of us said gamepass is not sustainable.

Something has to give. Quality dropping, studios and employees getting dropped, games with more MTs , battle passes and a price hike(s) are all needed to make Gamepass even have a chance to be sustainable.

[anast]

This

[shinoff2183]

Man we're we ridiculed for this foresight though. Turns out us armchair close weren't all that wrong.

[Petebloodyonion]

I'm sorry but this is a simplistic answer to a complex problem.
for 1 if the problem was purely Gamepass then we wouldn't see massive cuts across the industry.
Last I checked Game Pass is not on PlayStation and they have the biggest player base.

Now the author mentioned that HI-Fi Rush is a flash in the pants on Gamepass because it's played for a month then it drops making it impossible to recoup investment versus 1st day sales.
And I agree with the established IP making no sense in releasing day 1but HIFi Rush isn't an established IP
meaning that it would have failed no matter what

Sony themselves acknowledged this in an investor call when they mentioned that raising the price of AAA games didn't bring new money for the PlayStation brand but made the consumer more selective with their money favoring established IP.
Is Rise of the Ronin selling well?
How did Lord of the Fallen perform?

And that is the sad real truth for why Game Pass exist
because nobody actually buys unknown or less popular games
Sure everybody claims that if the game is good it will succeed but suddenly excuses are always mentioned when the game failed.

Just remember Gamepass wasn't there to explain
Dishonored and Dishonored 2 lack of sales
Evil Within and Evil Within 2
Prey, etc.

[Chevalier]

Many people literally showed with 100 million subscribers on streaming failing to turn a profit and how Xbox would also need 100+ million to even be profitable and you guys kept pushing back. They are no where near 100 million even. It's a giant loss of money. Add in COD and the losses will be insane

[Petebloodyonion]

WTF is the thing with your 100 million subscribers?
MS said they had 34 million subscribers and it's been close to the same for 2 years.
So let me ask you again if Gamepass is not on Playstation 4-5 with the largest user base then why are they having problems?
Why does Square is having problems when they don't care about Xbox?
What's the excuse for Dead Space remake, Alan Wake 2, Rise of Ronin, and countless games not selling on PlayStation?
Gamepass?

[shinoff2183]

This is specifically a Ms problem with buying all those studios and shutting a bunch down. Sony it seems will go more on the pc side but Sony has released anything on Xbox that they weren't forced to do unlike Ms. There's a reason Ms is releasing games on ps and more will come. It's because it's small base cannot sustain all those ips and gamepass has really killed sales. Ms said this themselves

[mastershredder]

...and overspending on aquisition only to find out they cannot aford to keep what they aquired. It's like an idiot winning the lotto and blowing it all on hookers and blow in loosing it in one night (or like Bobby Kotick rolling his bonus in Macau).

[gold_drake]

i think we all knew this qould happen really, after the Activision buyout.

but this is just blame shifting in the end. seen a few of them already

[P_Bomb]

I’m not buying HB2, but I will resub for a month to beat it. Such is the nature of GamePass, I guess.

[RNTody]

I did exactly this, with A Plague Tale: Requiem which is one of my favourite games of last year and despite having bought the first game. That is Game Pass for you. Now I have A Plague Tale: Requiem sitting on my Steam wishlist so that I can buy it on discount and support the developers in some small way.

Ninja Theory is definitely going down after Hellblade 2. They historically have never made games that ship millions and are thus not in MS' future plans.

[shinoff2183]

Theybmight keep em around a few months to get any sort of patches out that may need but after that I think your right

[46player]

Short story - MS sucks, MS is woke. Bought many game developers, ruined them, drove off the talent, lost much money, closed them, made excuses.

[shinoff2183]

I'm just down voting because the politics bs.

[jjb1981]

My perspective over the years is that gaming has become so mainstream that companies looking for profit or new heads trying to make a name for themselves are buying out these gaming companies for profit. They do not care about the vision of the creator anymore. Everything is risky. They want to buy ideas and talent that they never had. Games are barely even on disc's anymore. So many now have to be online. These companies just want to keep selling you stuff as many times and for as long as they can. They want you to act on that dopamine drip. Thank goodness for studios like Larian and From Software. Not even the Big N has stooped this low yet.

[JEECE]

I always like it when an "insider" comes out and confirms an obvious truth that everyone with common sense had been saying for years, and it's treated as big news.

[Abear21]

All is forgotten if you win the game. Show us what’s coming , hype the hell out of all those games on the horizon, and make sure the next big release on Xbox is actually ready to ship and most of these hate articles will go away

[TwoPicklesGood]

Xbox just needs major first party releases on game pass in order for it to grow. I’m not talking about 1 game a year either but 4-5.

[shinoff2183]

Will it though. Phil himself said they lost the worst generation to lose. And they lost it by a fking huge chunk. I wouldn't be surprised if half the Xboxs bought were for a secondary console or people like myself that buy all consoles at some point.

[Einhander1972]

You mean like Starfield?

[Psychonaut85]

I won’t be surprised if we find out that this was the plan all along, buy the parent companies, axe all the small studios and put all the focus on the big IPs and shelve all the small IPs for years until they figure a way to turn them into money machines. Or just let them rot. Fuck Microsoft. Cuz it’s either that, or the biggest case of fucking gross incompetence in like a decade. Either way fuck them.

[Barlos]

Greed. That's it