A star in the games business Twitter circuit, investor and analyst Matthew Ball has made waves in the industry over recent years with his "State of Video Gaming" slideshows, which in some corners have become doctrinal explanations for gaming's 2020s woes.

Now Ball has the chance to put his analysis directly to work at one of the biggest gaming companies on the planet: Xbox CEO Asha Sharma brought him on as chief strategy officer not long before initiating her "Xbox reset," which will result in 3,200 layoffs and see multiple studios cut loose.

Speaking to The Game Business after he was hired (before this week's "reset"), Ball said that step one for Xbox is shoring up its console business. But new Gears of War games are unlikely to achieve Sharma's ambitious goal to entertain "more than a billion people each day." So what's the plan?

The big-picture Xbox strategy hasn't been shared (and is surely still developing), but Ball's history suggests that Tim Sweeney and Roblox will be major inspirations.

Ball is a big believer in "the metaverse." He authored a book on the idea, "The Metaverse: Building The Spatial Internet," which was published in 2022 and revised in 2024, and co-founded the Roundhill Ball Metaverse ETF, an investment fund with stakes in Roblox, Microsoft, Nvidia, cryptocurrency exchange Coinbase, and a variety of major game publishers and tech firms.

Ball also co-founded a "UGC gaming studio" that says it's creating virtual worlds for Fortnite, Roblox, and Minecraft. The company, Prosimetrum, is credited as the creator of Steal the Shark, a Fortnite island developed by Brazilian studio Dojo Maps.

Ball is a passive partner in the business, not a decision-maker, according to a source familiar with the matter. Also associated with Prosimetrum is former Square Enix director of business development Jacob Navok, who currently runs AI company Genvid and has argued that "Gen Z loves AI slop."

The metaverse according to Ball

A universal definition of "metaverse" doesn't really exist, but in his book, Ball describes it as: "A massively scaled and interoperable network of real-time-rendered immersive virtual worlds that can be experienced synchronously and persistently by an effectively unlimited number of users with an individual sense of presence, and with continuity of data, such as identity, history, entitlements, objects, communications, and payments."

Essentially, it's the virtual world described by '90s sci-fi novel Snow Crash, and more recently Ready Player One: A network of immersive virtual worlds in which everyone's identity is persistent.

Ball does not suggest that this sci-fi vision will come to pass without friction—skeptics have had "a real basis for their skepticism," he says in his book—and it's certainly faced a lot of friction this decade.

Facebook's 2021 rebranding as "Meta" and Mark Zuckerberg's goofy VR avatar were mocked rather than embraced, NFTs were written off by many as worthless status symbols for gullible celebs and vectors for outright scams, VR and AR headsets have yet to sweep away old-fashioned screens, and after a metaverse hiring boom, the tech industry shed thousands of workers.

Above: Ball's recent interview with The Game Business

But among metaverse true believers, it's an inevitability, not just a dream. Ball concludes that he is "certain that the future will be increasingly centered around real-time-rendered 3D virtual worlds and networks" and predicts that computers and the internet "will evolve and be redesigned in support of the Metaverse." (A thought that could influence future Xbox hardware.)

Similarly, Epic Games CEO Tim Sweeney said in a 2024 conversation with Ball and Snow Crash author Neal Stephenson that, while a certain social media company's attempt to get everyone working in chic virtual offices was "just totally lame," the metaverse is the "inevitable future of real-time 3D in gaming."

Epic continues to pursue its metaverse vision: The recently announced Unreal Engine 6 is all about helping developers link up their in-game economies and social features so that players can take friends and purchases from one game into another.

Hints at Xbox's future

During his interview with The Game Business, Ball recalled Sharma asking him whether Xbox was "fixable." His response: "I'm a strategic optimist. I think it is incredibly defeatist to think that there is any scenario that you can't do better, that you can't improve."

So far, improvement has meant reduction: Aside from parting with four development studios and laying off thousands, Sharma has announced a desire to simplify Xbox's management structure and to invest "with greater focus, greater discipline, and greater clarity."

But Sharma also says that Microsoft is not reducing investment in Xbox, and there are hints about where the money will go (aside from toward getting The Elder Scrolls 6 out the door). The CEO said, for example, that rather than trying to own all the good indie studios, Xbox "will help independent creators succeed by providing open development tools and audiences to realize their vision." There are echoes of Epic's tools and platforms strategy in that remark.

Ball's interest in the metaverse doesn't necessarily mean that he was hired by Xbox to pivot the publisher toward that medium, but it stands to reason that the subject he dedicated book-length analysis to will feature in his advice. At the least, an increased focus on user generated content feels likely, and Microsoft could strengthen its relationship with Epic Games and Unreal Engine ("Fortnite is the future," Ball wrote in 2019).

Regarding UGC, it is notable that Minecraft developer Mojang will now report directly to Sharma, as it's the closest thing Microsoft has to Roblox.

For now, Ball has not hinted at any radical plans for Xbox's future. He said in his Game Business interview that Xbox's console business is "durable and valuable and important" and that upcoming shooter Gears of War: E-Day "looks terrific."

In his book, however, he predicts that the metaverse will be with us quite soon, suggesting that if Xbox is going to take advantage of such a radical transformation—should it actually come to pass—it ought to get to work on it with urgency.

"Though skeptics will shape the discourse," Ball wrote in his book, "I'd guess that by the end of the current decade many if not most of us will agree that the 'Metaverse' has begun (though even in hindsight, there will be no precise date of its start, nor will we be able to predict when it will arrive in full)."

I've seen a lot of complaints and concerns about the layoffs at Xbox that put 3,200 people out of work and resulted in the spinoff of four studios—eventually five, once the Arkane situation is sorted. One I haven't run across is a claim that it's all part of an effort to take jobs away from Americans and replace them with non-Americans on H-1B visas. That changed today, though, when Microsoft chief communications officer Frank X. Shaw took to social media to deny the claim.

The allegations are apparently rooted in stories like this one from Fox News, with the headline, "Fury erupts as US brand fires 1,600 employees after securing thousands of foreign worker visas."

Fox noted that Microsoft is laying off roughly 4,800 employees in total, the bulk of them from Xbox, while at the same time acquiring authorization "to hire from foreign countries 2,273 employer-sponsored, non-immigrant workers under what is known as the H-1B visa program."

Quoting a series of random people on X, the report states that "furious online critics claim that American jobs are being unfairly handed to foreigners," adding that "some online critics [have] claimed Sharma's Indian heritage played a role in firing the Americans, given the percentage of H-1B workers from India."

The H-1B is a non-immigrant visa that allows US business to hire foreign workers to fill certain speciality occupations. Criticism of the program and its impact on US workers has waxed and waned over the years, but it's taken on particular prominence during the second Trump administration: Earlier this year, Trump attempted to impose a $100,000 application fee for H-1B visas, although that was eventually overturned by courts. The Republican party continues to lean into it as a wedge issue, however: Vice President JD Vance, for instance, said during a recent speech that "American jobs ought to go to American workers and not foreign fraudsters, and the Department of Labor is fighting back against it."

It's the sort of rhetoric that can lead to bad places, and the accusations of H-1B visa abuse, accompanied by plenty of naked racism, has spawned countless posts, re-posts, and likes, particularly on X—enough to prompt Shaw to speak out.

"Lots of bad information out there—let's clear it up," Shaw wrote in his message. "Recent workforce changes were made to restructure the Xbox business because it is not healthy. They were not made to replace employees with foreign workers.

"The H-1B figures being referenced are Microsoft-wide visa renewals and new hire applications. They are not specific to Xbox and represent a small percentage of Microsoft's overall workforce. And the majority of roles impacted were not American roles."

Shaw also made a point of saying that "Xbox is the largest employer of American workers in the gaming industry and the largest American gaming company," and that its CEO is "American born, raised, and educated."

Earlier this week, the US Federal Reserve appointed Sharma to a new Productivity and Jobs task force, where she will help "assess the economic impact of new general-purpose technologies, including artificial intelligence, to inform the Federal Reserve's policy judgments."

Microsoft's cuts across Xbox studios, totaling 3,200 by later this year, included a massive reduction at id Software. The team lost 136 people (over half of the studio) just a day before its Doom: The Dark Ages expansion released, a bloodletting that had remaining and newly laid-off employees seriously concerned about the studio's capacity to make games and update its proprietary engine, id Tech, going forward.

"Nothing says business success like nuking a team into the dirt and relegating them to support studio size while also throwing out massive technological achievements," one impacted worker said.

Today, the official id Software X account made a statement aimed at assuaging these worries.

"While our studio was impacted, those changes were spread across teams. We still have the crew we need to build the games and tech we're known for. The team today is about the same size we were when making DOOM (2016). We have always had a flat studio where everyone is a maker, and we will remain true to that philosophy moving forward," the post reads.

That bit about the current size of the team matches a Windows Central report that also claims the studio is not being forced to move to Unreal Engine in the immediate future, as employees have openly speculated about. The studio's statement also suggests that it will continue work on id Tech.

"We are focused on supporting each other and the team members impacted. We're going to keep building the great games and tech that have defined us for the past 35 years, and we're looking forward to seeing you at QuakeCon this August."

While it's encouraging to learn that id Software won't immediately join a Fallout assembly line, as is Obsidian's new charge, the statement is unlikely to change a growing impression that Microsoft is an unfit steward of the studio synonymous with PC gaming. Personally, knowing that id Software is the same size it was 10 years ago isn't an encouraging sign for its future—it takes more people and more time to make games of Doom's scale and fidelity than it did in the 2010s, hence why the team had grown to 200-plus for The Dark Ages.

Whatever id makes next, it will now do so with an axe hovering over its neck.

Developer Mateo Covic, who went viral for complaining that thousands of people had refunded his game after finishing it in less than two hours, says he's not actually unhappy about the number of refunds or money he lost, or even Steam's policy in general—he was merely expressing frustration with players who "bragged about having a fun time with the game and refunding it after completion."

Covic is the solo dev of Paddle Paddle Paddle, sort of a very-low-budget Split Fiction. He got the ball rolling over the weekend when he shared an image of a one-line Steam review stating, "Great game, finished within 1:40 hrs (refunded)."

Tagging the official Steam account, Covic wrote on X, "This should not be possible. Would be cool if you could finally do something about your refund policy... Got dozens of reviews like that and 21% refund rate even though the reviews are 90% very positive... That's over 55,000 Refunds btw."

The message quickly blew up, and not entirely in good ways. Discussions about the obvious loophole in Steam's refund policy and what might be done about it followed, but so did a brief review bombing of Paddle Paddle Paddle, which holds a "very positive" overall rating on Steam, but is "mixed" in recent reviews. Many of those negative reviews aren't aimed at the game but at Covic himself, for suggesting that playing a game to completion and then refunding might be uncool.

My initial thought was that the numbers—55,000 refunds on a game that, according to SteamDB, hit a peak concurrent player count of 401— seemed a bit funky. I reached out to Mateo about it and he agreed: He's not sure why they're "pretty out of place," as he put it, but he shared his sales data with me to prove they're legit, and speculated that it might be simply because the game has enjoyed slow but steady sales since it launched in July 2025. He previously said Paddle Paddle Paddle had sold 150,000 copies on Steam back in December 2025.

Even the current controversy hasn't really impacted the game's sales trajectory, Covic said: "This discussion and virality right now did not change anything so far except that I'm getting plenty of hateful DMs daily and people review bombing my game."

Covic said the tweet that started all of this was something of a misstatement: The 20% refund rate on Paddle Paddle Paddle is actually pretty normal for a "rage game"—the sort of thing streamers like to play and performatively scream about—he explained, and he wasn't upset about the number of refunds but with people posting gleefully about playing the game from start to finish and then refunding it.

"My tweet phrasing was a complete mistake and I should have definitely not put the refund number in there," Covic said. "This led to a big misunderstanding: I have absolutely no problem with refunds at all and did not care about that before my tweet. The game always had a refund rate of 20% and that's normal.

"I just wanted to say that I think it's wrong to refund a game after having fun with it and completing it. That was my only point."

Covic does take issue with one aspect of Steam refunds: not the system itself, but the way people use it. "I wish that players would write down more useful comments ... many (not all) refund comments are not really helpful," he said.

"People refunded the game with the reason 'game too difficult,' and their comments do not really help me to improve or fix the game. Paddle Paddle Paddle is a rage game, so it was planned to be hard. I would like to read more constructive feedback here."

As for those who liked Paddle Paddle Paddle well enough to play it from beginning to end but then refunded it anyway just because they could, Covic said that's just not a philosophy he can support.

"One of the most common comments under my tweet was that a two-hour game isn't worth paying for and should be free," Covic told me. "Personally, I don't agree with that. Some of the best games I've ever played, such as Fears to Fathom and A Short Hike, are incredible experiences that take less than two hours to finish."

Despite all the kerfuffle, Covic is leaving the troublesome tweet up, saying he's "not gonna hide this mistake." For people who are seriously interested in Steam refund figures, he also recommended Simon Carless' Game Discovery Co. newsletter from February 2025, which dives deep on the topic. (I echo that recommendation, for the record.)

Covic is now working on a roguelite called Rogue Jungle that's expected to be out later this year.

Making a game is hard, or so I've been told by those brave enough to give it a go. Mistakes happen, and sometimes your game just doesn't work. That's what happened to the developer behind Red Flag, a social deduction game about convincing your friends you're fit to survive the apocalypse in a bunker with limited resources.

In a Reddit post last week (spotted by Automaton), the small, first-time team explains that it had unknowingly submitted a broken build of the game to Steam on the day of the deadline to get into June's Next Fest. The review and approval process typically takes five to seven days, the developer explains, so it really was cutting it close.

"It was the weekend. [Steam] Partner Support doesn’t work weekends. We sent a desperate email to regular Steam Support, honestly just screaming into the void."

Steam replied saying the build was sent for urgent review to, hopefully, get it into Next Fest in time. And a few hours later, viola, the Red Flag's demo build had been approved.

"But there was a note: the reviewer couldn't launch the game. We’d messed up the C++ redistributable setup (forgot to use the Steam common redist system, shipped local DLLs instead)."

Instead of rejecting the game and sending it back to the developers to fix (which almost certainly would've caused it to miss the deadline), Steam's reviewer fixed the issue themselves.

"Steam Support actually edited our configuration, sorted the dependencies, and approved the build so we wouldn't miss the fest. We’ve now passed our first day of Next Fest, wishlists nearly doubled, and we’re actually meeting players in our own lobby. All because Steam Support went way above and beyond."

Turns out, this is quite a common issue, with several other indie developers sharing similar experiences in the comments. "They did this for me on my first upload, too. Thought it was very cool.", one commenter wrote. It's apparently just a few clicks on Valve's behalf to fix such an issue, but it no doubt saved a last-minute panic from the game's creators.

Xbox's 'reset' layoffs have hit Bethesda hard, with long-term institutional talent shown the door—Zenimax Online Studios, which is part of the same studio family as Bethesda and works on the Elder Scrolls Online, was also particularly dismantled by Xbox, with over 60% of its staff laid off in the past year.

Understandably, Bethesda developers are irate. Partially because in some studios HR forced them to take down tributes to their laid off colleagues, but also because these layoffs seem to—as the Bethesda Game Studios Union (OneBGS) put it earlier this week—be part of a "stressful annual routine" for Microsoft.

And with 1,600 layoffs yet to come, a sword is left dangling over the rest of Xbox's studios, wondering who's to come next—prompting OneBGS to action. In a statement (shared here by Kotaku), the union said: "The company wants us to accept this as a done deal and quietly disappear. We won’t let that happen. Our next steps are to mobilize. We need every single member visible and unified.

"To that end, we are announcing our Save Our Devs March across all studios on Wednesday July 15th."

The objective, it seems, is to make sure that Microsoft understands it can't just keep doing this without adverse impacts on the developers left, who have the technical power to leave Xbox without one of their flagship studios:

"We need to show management right now that we mean business, so they will properly take care of our fellow co-workers today and think twice before ever attempting something like this again. Stay strong, look out for one another, and we look forward to seeing us all marching together on the 15th."

The scale and damage of these layoffs is yet to be properly tallied, but we know at this point that they include a near-hollowing out of id Software, the aforementioned ransacking of Zenimax Online Studios, and multiple hits to accessibility leadership.

It's a waste of talent and legacy, by all accounts, but not one that's unprecedented, mind. In addition to similar layoffs and project cancellations that occurred last year, Xbox has closed studios that've landed major hits before, including Hi-Fi Rush and Prey.

In 1984, an upstart retail company called Costco had just opened its first handful of voluminous warehouse stores on the west coast of the United States when it decided to try an experiment. It installed a hot dog cart in front of its San Diego store and started selling Hebrew Nationals with a drink for $1.50. People, it turned out, liked the hot dogs. The cart became Cafe 150, named for the combo price.

The company sold 245 million of them last year. When the CEO of the company in the 2010s complained to founder Jim Sinegal "we can't sell this hot dog for a buck fifty. We are losing our rear ends," Sinegal, likely then in his 70s, famously shot back: "If you raise the effing hot dog, I will kill you. Figure it out." A Costco hot dog and a 20 oz soda still costs $1.50.

In 1992, just a year-and-a-half after releasing a cutesy 2D platformer called Commander Keen, a tiny squad of game developers barely out of their teens started a studio called id Software and pioneered the first-person shooter. Then they followed it with Doom, maybe the most important computer game of all time. It was installed on more PCs than Windows. That tiny squad hired more people and then made Quake, maybe the most important 3D computer game of all time.

Decades later, a new generation of people at id dedicated to that legacy defied expectations to make another shooter so good it could proudly stand beside the ones that defined videogames. Then they made an even better one.

On Monday, Microsoft, which owns Xbox, which owns Bethesda, which owns id, laid off 136 developers from the Texas studio, which 12-year art veteran Derek Best described as "nuking a team into the dirt." Neither id Software or Doom were mentioned in CEO Asha Sharma's "Resetting Xbox" announcement. But the studio's new game, released one day after much of the talent behind it were laid off, currently occupies the top banner on Xbox.com.

What does it say about a company when it doesn't understand—or at any real level seem to care about—something it has become the steward of?

Doom, as a series of videogames, has generated hundreds of millions of dollars. But Doom is not just the money it's generated. It's the literally countless mods, maps, and entire games built on its bones; incredible ones are still coming out right now. Doom is the countless people making games today who cut their teeth mapping or had their neural pathways permanently altered the first time they picked up the Super Shotgun. The original game's labyrinthine levels and pulsing music and gory kills were revelatory enough, yet it's literally impossible to overstate its impact on the history of videogames from that moment forward. John Carmack programmed in the network code that enabled multiplayer in one month, in November 1993, and the game came out 10 days later. John Romero called the multiplayer deathmatch, and we're still calling it that today.

id Tech, the studio's ever-evolving engine, is not just a modern marvel that runs like a greased-up bat hurtling out of hell at a time when its competition is leaning on AI upscalers to crack 30 frames per second. It is the origin of yet more careers, thanks to its history of open source releases; one of the best indie games of 2025 uses it. It is a creation that any executive with any amount of vision would see as both a point of pride and an invaluable asset. You bought your way to the inner chamber, the very beating heart, of videogame software. Is that not a thing to revere?

Ahhh, but how much money does id Tech make? How much is it really worth? Xbox, its leadership says, is "not healthy," and as a result hard choices have to be made. That's just sensible business, not a short-sighted attempt to maximize shareholder value this quarter by kneecapping an incredible asset.

How else could this have gone? Last year Costco took home $275 billion in revenue (just $6 billion shy of Microsoft), and its former CEO—the one whose life was threatened over the sanctity of the hot dog—bluntly said "we have never been a company that puts the shareholders on top." A few months ago his successor housed a hot dog in a viral Instagram video before declaring: "The hot dog price will not change as long as I'm around."

He also said, through a mouthful of meat, that it's a good hot dog. And it is a good hot dog! But that's not why people love it.

People love the Costco hot dog because it's a symbol for the whole operation: that you're paying the membership dues because the deals are worth it. That they're going to give you a good value for every goddamn cent you give them. It stopped mattering years ago if the hot dogs themselves made money or not.

Costco's founder Jim Sinegal, who declared the buck fifty frank more valuable than a human life? The hot dog cart wasn't even his thing back in 1984. The idea started at a competing warehouse chain, Price Club, which merged with Costco in the '90s. But Sinegal knew what he had and expanded Cafe 150 into the food court, now one of Costco's biggest draws. That's how you treat a legacy.

The people at id Software—or the people who were at id Software as of four days ago—knew how to treat a legacy. They got it so deeply that it was evident from the very first moments of Doom 2016, as PC Gamer's James Davenport wrote in the very first paragraph of his review 10 years ago:

This thing here? It's important.

How does the company that's for decades been synonymous with the PC—much as we now wish it weren't—end up with its hands on the game studio that's synonymous with the PC, and not see it as a priceless asset?

"Xbox has many of the most beloved franchises in entertainment history," Xbox CEO Asha Sharma wrote on Monday. id wasn't mentioned. What does it say about the people in charge that they paid to get their hands on that kind of legacy, and then gave it less respect than a $1.50 hot dog?

John Carmack has reacted to a major round of layoffs at id Software, the studio that he co-founded in 1991. Microsoft is cutting 136 roles (reports indicate over half of its headcount) at the Doom studio, which just released an expansion for Doom: The Dark Ages this week.

"My 'Microsoft will probably be a good steward of the brand' statement isn't aging well," Carmack wrote on X, "and this is certainly going to dampen the mood of the founder reunion at QuakeCon next month."

Despite what comes across as disapproval of the layoffs, Carmack stops short of criticizing Microsoft's decision.

"I'm saddened, but I can't muster anger or outrage over it. I don't have access to the books, but I suspect that id Software was a marginal business from Microsoft's perspective. I believe the reports that Minecraft revenues have been carrying several other studios."

Carmack is referring to a recent Bloomberg report that claims profits from Minecraft had been redirected toward less financially successful Xbox studios for the past several years.

"To continue being produced long term, games need to succeed, not just be beloved. Games are competing with every other option for spending your leisure time and money, and the competition is brutal. You can't rule out the possibility that executives are idiots, but that shouldn't be your default belief. I don't think there is any obvious path that would have doubled the revenue from id games."

He then went on to offer some hypothetical strategies that could have prevented where we're at now, which is the decimation of the team behind the most critically-acclaimed shooters of the generation.

"Could they have gotten more with a different pricing strategy? Could they have created more things for fans to buy? Could they have cost effectively marketed in a way that reached more players that would have loved and bought the games?

"Could they have changed the game designs and broadened the appeal to more players without alienating existing ones? Could they have produced the games at a lower cost, faster or cheaper?

"I really don’t know."

In his own response earlier this week, id Software co-founder John Romero expressed grief for those suddenly out of a job—an ordeal that he can relate to, considering that Xbox cut funding for his studio's next game this time in 2025.

"I know what it feels like to leave id while id goes on. It's a strange and painful thing to step away from a place that holds so much of your work, friendships and history… Romero Games was there a year ago. I know how devastating it is, and my heart's with all of you."

The Board of Governors of the Federal Reserve, the body overseeing the implementation of United States monetary policy, has announced the creation of five task forces intended to evaluate and improve the Fed's operations. In a press release, Federal Reserve Chairman Kevin Warsh named the "external advisers" who will lead each task force, ranging from economics professors to AI investors and corporate executives—executives like Xbox CEO Asha Sharma, who will preside over a task force on employment and productivity.

Yes, that Asha Sharma. The Asha Sharma who, just three days ago, announced an Xbox "reset" that will see roughly 3,200 of her employees lose their jobs by the end of the 2027 fiscal year—a reorganization that remaining developers are reportedly convinced will cause irreparable damage to some of the company's most valuable brands.

Sharma will be one of three leaders heading up the Productivity and Jobs task force, which will "assess the economic impact of new general-purpose technologies, including artificial intelligence, to inform the Federal Reserve's policy judgments." She'll be joined by Stanford economics professor Charles I. Jones—"currently on leave at Anthropic"—and Marc Andreessen: tech VC, major AI investor, and guy who believes you can improve an LLM's results by simply instructing it to be very, very smart.

"The Federal Reserve's commitment to price stability and maximum employment is unwavering. As is our resolve to pursue our mandate with rigor. The US economy has changed significantly over the last generation, and never more so than right now," Warsh said, deploying a sentence that definitely made sense. "Each task force will carefully consider whether policymakers' means and methods, analytical tools, and policy approaches can be improved upon. I am honored that the best minds from a range of disciplines have agreed to work with us to sharpen our performance as an institution."

Considering Sharma announced that Mojang and King—two of Xbox's most valuable operations—will now report directly to her, I'm impressed that she'll be able to find the time. According to the Fed, we'll be able to follow the task forces' work in updates "posted periodically" on its website.

As reported by MMORPG, we now know the full scope of the layoffs at ZeniMax Online Studios (The Elder Scrolls Online) and ZeniMax Media, parent company of Bethesda Game Studios. A Maryland WARN Act notice shows 213 employees laid off from ZeniMax Online, and 166 from ZeniMax Media, for a total of 379.

ZeniMax Media and Online have two listings at separate offices on the WARN notice. There is no separate WARN notice for Bethesda Game Studios, indicating that the 166 layoffs at ZeniMax include those at BGS⁠—Bethesda and ZeniMax Media share an office address.

Further supporting this, the 136 layoffs at id Software were reported as "ZeniMax Media Inc. (Richardson Texas)" in a separate Texas WARN notice. It is unclear how many of the 166 people laid off from the ZeniMax Rockville office were Bethesda developers, and how many came from the ZeniMax publishing side of the business.

As for ZeniMax Online, we've already heard substantial anecdotal evidence that the studio was devastated by these layoffs, and the numbers add further perspective. Game Developer reported the ZeniMax Online Union as containing 461 members at the end of 2024⁠—mostly based in the Rockville offices, though some were spread across the country.

ZeniMax Online has lost 275 employees between July 2025 and '26⁠—a WARN notice last year for "Zenimax [sic] Media, Inc." using ZeniMax Online's office address put last July's layoff count at 62. Assuming no other significant sources of attrition and that the union accounted for a majority of employees, that means ZeniMax Online now consists of 186 people, or 40% of the manpower it had just a year and a half ago.

A September 2024 Twitter post by user Timur222 shared a since-amended LinkedIn experience entry by former ESO UX lead, Gary Boodhoo. In it, Boodhoo cited ESO as bringing in "$15M in monthly revenue for over 10 years." Now, I'm no businessman, but that sounds like a team you'd want to support, rather than laying off at least 60% of them in a year.

Here's an embarrassing thing to admit on the internet: when I was a teenage subscriber to Nintendo Power magazine, I picked the Donkey Kong 64 soundtrack as my "sign-up gift" because I wanted to be able to listen to the DK Rap on CD. Why I was obsessed with the song I can't say 25 years later, but Donkey Kong 64 is a memorable mess of a game—sprawling, ambitious, funny, inventive, and often infuriating, with a predilection for collectibles so infamous that the developers eventually made fun of themselves for it.

The point is, Donkey Kong 64 is a game that inspires strong feelings in those who've played it. So it seems fitting that members of the DK64 randomizer community, who've dedicated years to picking it apart and putting it back together, would start developing an unofficial PC port with a specific rallying cry:

"Fuck AI vibe coding bullshit."

DK64 Recompiled, announced in a YouTube video in late June, is actually the second project with that exact name, and that's no coincidence. It's the latest example of an increasingly common point of friction in the game emulation and hacking scene, as experienced programmers butt heads with those eager to use new AI tools to spin up new ports of old games in record time. In some cases, ports written with AI tools like Claude are ostracized or ignored. But in the case of Donkey Kong 64, the game's biggest fans weren't about to cede ground.

"The DK64 randomizer dev team is owning this shit now," contributor 2dos wrote in the N64 Recomp Discord server, shortly after the video's debut. "We have decided to take on and own this development due to the poor development direction of another recompilation project of DK64 happening concurrently that is heavily leaning on AI vibe code, and thus is resulting in a poor quality project that will make it progressively harder to manage as time goes on. Our DK64 recompilation project is backed by folks who have worked on and tinkered with the backend of the DK64 code for well over a decade, and do not rely on vibe coding to make code changes."

Static recompilation is a technique that, in short, translates all of a game's code from one system's language to another; unlike emulation, it's not simulating the original hardware holistically. The most prominent hobby project using this technique so far is N64 Recomp, announced just over two years ago, which is a recompilation tool specifically geared towards Nintendo 64 games. Since its debut we've seen modders use it to create PC ports of Banjo-Kazooie, Star Fox 64, Mario Kart 64, and more, while similar projects have sprung up for other consoles like the Xbox 360.

Legally, the freshly written code is clean because these recompiled ports don't contain any of the assets from the original games—players have to provide a ROM file themselves. The porting process has become an ethical, rather than legal, battleground in the last few months, as "vibe coded" projects have begun cropping up practically every day.

One developer has used Claude's AI coding to spin up recompilation tools for the NES, Sega Genesis, PlayStation, Super Nintendo, Game Boy Advance, and Virtual Boy, each with a handful of games at least bootable so far. Another's got GitHub repositories for everything from the PS3 to the ZX Spectrum. Others have used the Xbox 360 recompilation framework ReXGlue to pump out ports at a seemingly astonishing rate—but once you get past the YouTube videos hyping them up, the reality isn't quite so impressive.

"Vibe coding a recomp has started to become significantly more prominent and not in a good way," says Ballaam, a contributor to the DK64 randomizer and now DK64 Recompiled alongside 2dos. "I think GoldenEye was released somewhat recently with being heavily vibe coded and, as a result of that (and probably either dev inexperience or overconfidence in the AI output), it leads to some very critical bugs which make the recomp borderline unplayable. The main N64 recomp server has gone as far as to not promote any recomp which uses AI for a significant portion of it."

That GoldenEye project has also drawn criticism from those who know the game inside and out. The paradox of current tools making it easier than ever to start projects means anyone can vibe code their way to a partially working port, but shaping it into an accurate, crash-free, feature-rich version of a game is a different story.

2dos warns that a big risk with relying on AI is technical debt—a codebase becoming harder to understand and modify as it grows, with maintenance becoming "a nightmare" if you don't put in the work to thoroughly document it. The knock-on effect is that other humans are less likely to want (or even be able) to contribute. If a developer doesn't thoroughly understand the code the AI writes, that will also require them to spend more tokens to fix bugs. Those costs can add up fast, and the AI's "fixes" won't necessarily be good, either.

In the case of the AI-based Donkey Kong 64 recompilation, 2dos discovered that the agentic coding had modified RT64, "the base module that makes the N64 graphics render."

"That would lead to significant management and compatibility issues down the line, and cause other unexpected side effects that are currently visible in preview videos in the other recomp," he says.

Vibes: Questionable

Using AI is attractive because it skips past the slow, manual process of figuring out exactly what every function in a game is doing, which can often take years. Many of the polished recompilation ports available currently are for games that have previously been decompiled, creating fresh, human-readable source code. It's an enormous undertaking even for old games, but understanding what the source code is doing helps enormously when troubleshooting.

Decompilation also makes modding much more viable, which is one of the most attractive features for modern ports of retro games. (DK64: Recompiled's debut trailer touts support for a tag anywhere mod that will let players swap between Kongs on the fly, addressing one of the most common complaints about the game's backtrack-heavy design.)

Developer SrBananaMan64 recently released a PC port of Harvest Moon 64 alongside a range of mods to speed up messages, zoom out the camera, and so on. A completed decompilation by another developer helped make that a reality.

"Recompilation doesn’t actually need a 100% decomp to work, just enough for the symbols to be mapped out to produce a viable .elf file that N64Recomp uses," SrBananaMan64 says. "But this game seemed like it needed the proper enhancements to spruce [it] up… The quality of the game is lacking so it needs the widescreen and high frame rates to compensate for that in my opinion."

He shares the DK team's view that developers "should never let AI take the wheel," even if it can occasionally be an "amazing tool" for specific uses. "Minuscule tasks such as searching through a decomp for a certain function you would like to patch or mod," for example.

Lines for acceptable AI usage are now being drawn across the open source development scene. The maintainers of the Godot engine are now rejecting "substantial pieces" of AI-generated code. A nascent recompilation project for the GameCube & Wii declares "No AI code is used," and that it's a "human hand-made project by a group of passionate developers, who want the best for the Retro Gaming community." So does a solo project tackling recompilation for the PS1.

A port for Sonic Advance also has a "strict no AI policy," championing the endeavor's underlying purpose: "We want humans to use this project to practice their skills. Reverse engineering, documenting, understanding, being part of the process."

Tom, the developer behind ReXGlue, sees the low-effort ports as a "people problem," not an issue with the tool itself. "The real issue is people who don't bother to understand what they're posting," he says. "They're using a powerful tool without putting in the work to actually learn what it does, and then wondering why their project falls apart, performs poorly, or has nothing genuinely new to bring to the table. It's like riding a motorcycle before you can even ride a bike."

One common defense for vibe coding ports boil down to "this is just my hobby project, so ignore it if you don't like it." One counter-argument to that point is ethical. Even setting aside the broader environmental impact and stolen training data of generative AI models, there's an argument that even a fan-made port should endeavor to do justice to the original work—to honor the game's original creators by representing it as accuracy as possible. Another is that a vibe coded port that's likely to have those long-term maintenance issues 2dos warned about could pull interest away from a human-coded project that's more likely to be perfected in the long run. The existence of a half-assed project could even turn another developer away from putting months or years of their work into a game at all.

"That’s a big risk," SrBananaMan64 says. For example the Smash Bros. Battleship project which was completely AI generated will take away from the release of mine." (He's currently working on his own recompilation of the N64 fighter).

Another common defense from those simply eager to play a game they love—that anything is better than nothing—also doesn't necessarily hold up beyond the initial burst of excitement.

"I think there is some sentiment from those who haven't experienced a vibe coded recomp that 'who cares if its vibe coded as long as it works," says Ballaam, "when they don't fully realize that for the most part, they really really don't.

"LLMs nowadays have lowered the skill floor of producing a functioning piece of code that those who are technologically curious but don't have the patience or passion to fully learn a language can feel like they're coding. They scale up their projects but don't scale up their learning to accommodate their desires because they rely too much on the AI crutch."

Perhaps someday, as agentic coding continues to advance, vibe coded ports really will be sufficient. Perhaps a small portion of this initial wave of vibe coders will even pick up enough interest in the process to learn to do the programming themselves. Or maybe the rising costs of AI models will dissuade casual hobbyists from burning tokens on projects that are hard to see through to completion.

For now we're in the thick of it, and we're sure to see more competing projects like Donkey Kong 64 Recompiled before we come out the other side.

The full scale of Xbox's rash of layoffs is still to be properly tallied up—partially because CEO Asha Sharma is yet to announce a further 1,600 axed roles. One particularly harsh casualty is id Software, which has taken around 136 job losses on the chin. A move that one employee described this week as reducing it to the size of a "support studio".

We're just now learning about the projects that the developer, which had just released a large DLC for Doom: The Dark Ages, was cooking—courtesy of Gamesbeat. The report states that id Software was looking to pitch a Perfect Dark reboot:

"The team was also considering doing a game based on Perfect Dark, the franchise that hasn’t had a new addition since Perfect Dark Zero in 2005 on the Xbox 360 game console … Concept art was in the works."

And, listen—it's not confirmed this pitch hasn't been picked up, or even that it's been impacted the layoffs. But I think we can all take a deeply educated guess that it's unlikely id Software is going to have the resources to make it. It's a studio whose majority of staff has been shown the door, forced off its homegrown game engine and forced to work in Unreal. Chances of it happening are microscopically slim.

Which wouldn't be the first time Microsoft has killed a Perfect Dark reboot in the past five years. Back in 2025, a staggering 9,000 layoffs saw developer The Initiative closed, and their version of the game—which had an impressive gameplay demo in 2024—tossed into Microsoft's growing landfill of shuttered projects.

Another project from the hollowed-out studio that likely won't see the light of day is a John Wick-inspired game dubbed "Fury", says the Gamesbeat report:

"It had elements of sci-fi, noir, and Louisiana and Chicago gangsters. It had a modern, cyberpunk-like feel. It had a concept called Gun Fu, which combined gunplay with martial arts. The game was supposed to feel a lot like a John Wick movie, but it was not formally greenlit for production."

Sounds awesome, and I figure if anyone could've pulled it off, it would've been id Software, progenitors of Doom—shooter experts in their own right. Will it ever see the light of day? Well, Microsoft would have to restore an estimated 3/4ths of its staff, first. I legitimately can't think of a game that a studio who has lost that much talent could even make. When your co-founder's mourning their own former studio, you're probably in trouble.

The scale of Microsoft's brutal Xbox layoffs become clearer by the day. Among the studios that Xbox hasn't decided to dump from its portfolio entirely, we now know one of the outfits hit hardest by CEO Asha Sharma's "Xbox reset" was id Software.

The Doom studio, which just released a massive expansion for Doom: The Dark Ages this week, will lose 136 roles, according to WARN notices. It's a substantial downsizing that, according to laid-off VFX artist Derek Best (as spotted by VGC), has diminished the PC gaming institution to a "support studio size" overnight.

"I'm still in shock at how brutal the layoff cuts were," Best wrote on LinkedIn. "Collectively decades of knowledge was wiped out of the studio. The VFX team was eliminated down to one single artist with no lead or producer. The engine programmer responsible for the massive gains in VFX pipeline improvements (like all the particle editor work) was let go as well.

"Great job Microsoft. Nothing says business success like nuking a team into the dirt and relegating them to support studio size while also throwing out massive technological achievements."

It's a particularly painful pill to swallow around these parts, not just because the modern Doom series is the greatest singleplayer FPS effort happening at a large scale, but because the story of id Software is integral to PC gaming itself.

In a follow-up comment, Best says the "engine team was decimated," which could indicate Microsoft will no longer invest in idTech, the studio's in-house engine with roots in just about every FPS worth talking about.

"Writing on the wall is getting relegated to support studio size and moving to Unreal, based on internal email and the roles you can see clearly got impacted," Best wrote.

Todd Boyce, a lead VFX artist at id, also chimed in on the same thread.

"This is what insanity and despicable corporate greed looks like. What a complete disregard for people who spent months working unpaid overtime to make the DLC, and for an engine that has consistently been the industry standard for performance. It is pretty insulting how it was done, when it was done, and what it will do to the id brand and those who are still employed (for now.)"

PC Gamer has reached out to Bethesda for comment on id's future and will update if a reply comes in.

Bethesda Game Studios reportedly suffered "significant" cuts during this week's Xbox layoffs, which put 1,600 employees out of work across Microsoft's gaming division as the initial wave of a sweeping reorganization scheme aiming to achieve 3,800 layoffs by the end of the company's 2027 fiscal year.

In the aftermath of Xbox's bloodletting, the Bethesda Game Studios Union says staff at the studio's Rockville, Maryland office assembled a "Celebration of Service" display honoring their laid off colleagues—a display that employees were "almost immediately" forced to remove by the company's human resources department, the union says.

Unfortunately, HR made our office manager take this down almost immediately. They said because it's in a common area, it had to be removed. We've used common areas for many things as a team, including fan works, but HR seems to believe that a Celebration of Service is inappropriate.

— @bethesdaunion.bsky.social (@bethesdaunion.bsky.social.bsky.social) 2026-07-08T20:10:38.427Z

The BGSU first shared images of the Rockville display on Bluesky this morning, saying the Maryland office had been inspired by a similar display that had been organized by employees at Bethesda's Dallas offices. A follow-up post, however, indicated that the display had been short-lived.

"Unfortunately, HR made our office manager take this down almost immediately," the BGS Union said. "They said because it's in a common area, it had to be removed."

According to the union, staff had previously used common areas like the one hosting the memorial display without issue for purposes like displaying fan works, "but HR seems to believe that a Celebration of Service is inappropriate."

Now—while I'd never suggest that you have to hand it to the HR department of a Microsoft subsidiary—I will admit that the framed photos and solemn floral arrangement shown in the union's images did lend the display a certain funereal air. But if HR didn't allow staff an opportunity to alter the display to look less like it was mourning a more permanent sort of tragedy, tamping down on employee commiseration after watching hundreds of colleagues and peers lose their livelihoods isn't a great look.

The extent of the layoffs is striking: Among those who lost their jobs this week were Bethesda Games Studios staff like Christiane Meister, a senior character artist who oversaw character art asset creation from every Elder Scrolls game from Morrowind to Skyrim during her 27-year tenure at the studio.

"We lost dozens of programmers, artists, designers, and testers. Many of whom worked at BGS for decades," the BGS Union said in another Bluesky post earlier this week. "If Bethesda fans are worried this will harm the quality of future games, like The Elder Scrolls 6, let Microsoft know!"

PC Gamer has contacted Bethesda for comment and will update this story if we receive a response.

Yesterday's 1,600 layoffs at Xbox—just half of the 3,200 job cuts Microsoft intends to inflict on its gaming division by the end of its 2027 fiscal year—seem to have taken a heavy toll on the company's celebrated accessibility efforts.

In the 24 hours since CEO Asha Sharma pronounced Xbox's "reset," senior and lead accessibility specialists have confirmed that they've been affected by the associated layoffs, casting into doubt how committed the company will be to championing accessibility initiatives like it has in recent years.

The first indication that accessibility efforts weren't coming away unscathed from Microsoft's cost-cutting emerged in mid-June, when an accessibility program manager working on contract said in a LinkedIn post that he was "unfortunately part of the incoming Xbox layoffs." Beginning last week, those job cuts seemingly began to accelerate, as an accessibility test lead for the Microsoft Gaming Accessibility Testing Service made a similar post saying he was seeking work after almost three years of Xbox accessibility consulting and organizing accessibility testing on over 1,000 Xbox Store titles.

Following yesterday's announcement, the scope of the layoffs had expanded to include accessibility leads like Kaitlyn Jones, who in five years at Microsoft had led projects like the Xbox Adaptive Joystick and the company's publicly-available training program on gaming accessibility fundamentals. Elsewhere, Elisabeth Whyte—an award-winning senior user researcher for accessibility who had spent seven years at ZeniMax—made her own open-for-work posting, indicating that accessibility specialists at Xbox's game development studios were affected, too.

Xbox's accessibility initiatives have been one of its few unequivocal achievements in an era of pervasive dysfunction: By investing in the development of peripherals like the landmark Xbox Adaptive Controller and the creation of accessibility guidelines in collaboration with industry and disability specialists, Microsoft has been a driving force in promoting the gaming industry's recently-increasing implementation and normalization of accessibility and disability-conscious options.

Xbox, however, says its cuts don't mean it's retreating from those initiatives.

"Accessibility remains a priority for Xbox," a Microsoft spokesperson said in a statement provided to GameSpot. "While we’ve made changes across the team, creating more accessible gaming experiences for players has not changed."

We'll have to wait and see how accurate that commitment proves to be. If Xbox is truly hoping to entertain "more than a billion people each day," cutting the employees who helped ensure its games are playable by as many people as possible seems like a strange way to go about it.

US senator Bernie Sanders is famous as not-exactly-a-friend of powerful corporations: He's previously called for OpenAI to be broken up, for instance, and earlier this year announced a bill that would pause the construction of data centers in the US, to give lawmakers a chance to catch up with, and regulate, AI companies.

But AI isn't Sanders' only PC-centric bugaboo: He's also pretty pissed off about the Xbox situation.

"Last year, Microsoft made $101 billion in profits, got a $12.5 billion tax break from Trump and paid its CEO $96 million," Sanders blasted out on X, not long after the announcement of sweeping layoffs at Xbox.

"This year, it’s raising the price of an Xbox by $150 and eliminating 3,200 jobs. Please don’t tell me corporate tax breaks create jobs. It never trickles down."

The concern is clearly more about the deeply unfair and unhealthy oligarchy we're living in, and not how much Sanders has to pay for the next Xbox, but I find it interesting that the relatively mundane dealings of a game company are enough to attract the attention of such a high-profile politician.

Of course, this isn't ol' Bernardo's first bit of Xbox-related criticism: In 2022, he joined with fellow senators Elizabeth Warren, Cory Booker, and Sheldon Whitehouse in calling out Bobby Kotick's golden parachute following Activision Blizzard's acquisition by Microsoft.

That, sadly, might lead to a certain amount of cynicism about what Sanders and other lawmakers can actually do here, aside from posting about it. The US Federal Trade Commission actively opposed Activision Blizzard's buyout, but its efforts to halt the deal, or even just pause it while legal challenges worked their way through the system, were repeatedly thwarted. Former FTC chair Lina Khan, who headed up the agency during the acquisition, pointed out in 2025 that Microsoft's actions since the merger are pretty much exactly what she tried to warn everyone about.

Xbox CEO Asha Sharma has made a number of big changes since taking over from former chief Phil Spencer. Some of them—dialling back Game Pass, leaning into exclusives—collectively represent a pretty clear repudiation of Xbox's choices under Spencer. In a new interview with Fortune (via Game Developer), Sharma said that Xbox spread itself too thin under its previous strategy.

"In order to grow, we made a bunch of bets ... and as we did that, we inherently didn’t focus on the core business," Sharma said. "The number one measure of your strategy is what you put your resources behind, and we simply spread ourselves too thin."

The Fortune interview was published on the same day that Sharma announced 3,200 layoffs at Xbox, and the spinoff of four of its studios.

Sharma also returned to one of her key points in that layoff announcement: That the Xbox business is not "healthy."

"A healthy Xbox could weather the shock of the hardware crisis," Sharma said in the interview. "With an unhealthy Xbox, it becomes really challenging, and it accelerates a lot of the changes we need to make."

The reference to "health" presumably means that, with better profit margins, Xbox would be able to better absorb the hit of the rampocalypse (that Microsoft, ironically, is helping make happen) because it would have more flexibility when responding to price hikes: Profits might go down in order to keep retail prices palatable, but there's more room for them to shrink without actually causing losses.

Regardless of the "health" of the Xbox, component prices are astronomically high and likely to get worse, and that impacts everyone. Materials costs alone for the next PlayStation console are currently estimated to exceed $900, and the cheapest Steam Machine you can buy is $1,049.

That's an enormous amount of money for a game console. True Xbox optimists might imagine that Microsoft could use those wider profit margins Sharma aspires to in order to bring prices down to a less eye-watering level, and sure, it could. I wouldn't hold my breath.

Sharma said Xbox executives are also experimenting with new business models, such as "buy now, pay later" financing program, which will nominally reduce the barrier to entry but—speaking as someone with a bit of experience in the retail electronics field—may also leave customers who don't read the fine print and sufficiently mind their money burdened with far heavier debt than they expected.

However it shakes out, Sharma said the process is going to take time, and hinted at the possibility of more unpleasantness ahead: "I think our core has to be healthy, and that will be necessary but not sufficient."

New CEO Asha Sharma hit the reset button on Xbox yesterday, taking out 1,600 jobs at once with another 1,600 cuts still to come before the end of the year. Very few studios escaped the scythe: even id Software's legendary name did not save it, and it quickly became clear the studio had been swept up in the bloodletting.

Now, anonymous sources tell Game Developer that the losses at id amount to around half the studio, and that the QA department in particular has been heavily affected. Meanwhile, id co-founder John Romero has taken to social media to express his grief at the cuts.

"I'm so sorry for everyone at id Software affected by these layoffs," wrote Romero. "I know what it feels like to leave id while id goes on. It's a strange and painful thing to step away from a place that holds so much of your work, friendships and history." Romero, famously, was forced to resign from id in the mid-'90s after clashing with fellow co-founder John Carmack (they're on better terms now).

Romero, for his part, is pretty chuffed with how id's current devs have continued the studio's legacy. "Doom, Quake, and Wolfenstein are not easy names to carry on, especially in today's industry," he wrote. "The last few games showed real care, skill and respect for what those worlds mean to people."

Touching on an issue with particular salience in the wake of Sony's announcement that it will be ditching physical PlayStation discs in 2028, Romero professed hope that someone is doing the work to preserve "the company's ongoing legacy (the work, code, assets, stories and the people behind them).

"id's history is critically important to the history of games. I've preserved id's complete early history from our start at Softdisk through to August 6, 1996, including materials and assets that, as far as I know, id itself no longer has." In a follow-up post, Romero added that "For those asking, it's in my will to donate everything to the Strong Museum of Play, including all digital assets."

Regardless, Romero's heart goes out to the studio's current and (now) former devs: "I'm thinking of everyone at id today, and everyone else affected by yesterday's layoffs. Romero Games was there a year ago. I know how devastating it is, and my heart's with all of you."

Hitman and 007 First Light developer IO Interactive announced last week that it had lost funding for Project Fantasy, an "online fantasy RPG" first announced in 2023, and that as a result, "we have to adapt to this new reality and its short-term consequences, including staffing decisions." That sure sounded like layoffs were incoming, and today, the studio confirmed it, saying that it is closing its studio in Istanbul and beginning the layoff process for an unspecified number of employees.

"Following the end of our external finance partnership on Project Fantasy, IOI has regained full ownership of the project and our IP," the studio wrote on X. "We will continue to develop and fund it independently amongst our other projects.

"With this context, we had to find a new balance for the long-term future of the studio, focused on the success of our main internal core titles instead of external projects and potential mobile game derivatives. This has meant making changes as well as proposed changes across our studios: the closure of our Istanbul studio and starting a process to part ways with colleagues who have been a meaningful part of what makes IOI what it is."

Prior to the announcement, IOI maintained five studios, thanks to significant expansion in recent years: It opened a new studio in Malmö in 2019, one in Barcelona in 2021, and two more, in Istanbul and Brighton, in 2023.

IO Interactive didn't say who its external partner was when the end of funding was revealed last week but we assumed—and Bloomberg later stated—that it was Microsoft. The move came a week in advance of sweeping cuts at Microsoft's Xbox division, which announced yesterday that 3,200 employees are being put out of work. Xbox is also spinning off four of its studios: Compulsion Games, Double Fine Productions, Ninja Theory, and Undead Labs.

It's been an awful week for layoffs, and Lemon, it's only Tuesday, but the IO Interactive situation stands out as particularly awful and baffling because the studio released one of the biggest games of the year so far, 007 First Light, just over a month ago. A well-received, multi-million-selling game based on one of pop culture's most lucrative licenses should've been cause for celebration.

Instead, it's been mostly the opposite: Shortly after launch Amazon, which owns the license, refused to commit to bringing IOI back for future 007 games, and now this. Rubbing a bit of salt in that wound, the Hitman television series announced in 2017 was pronounced dead in March.

"These are hard, but necessary decisions, in order to retain the long-term future of IO Interactive as one of the very few fully independent AAA developers and publishers, as well as to give Project Fantasy the best possible foundation to succeed under our own passion and direction," the studio wrote. "Project Fantasy is a game, a world, and an IP that we are wholly committed to, and we cannot wait to share the love with you."

IO Interactive said that because the process is still ongoing, it doesn't have further information to share on the number of people losing their jobs.

The Xbox reset is afoot, and while there aren't strictly speaking any studio closures yet, with multiple developers in the process of moving elsewhere, the shockwaves from its impact are still being felt across Xbox's continually-shrinking staff. All in the service of a mathematically improbable 1 billion daily player count, or something. It's hard to keep track.

Anyway, given Blizzard was namedropped in the announcement post as a target that'd be experiencing "reductions" and "shifting investment", one might wonder if the developer—which Microsoft acquired for an eyewatering $68.7 billion—was on the chopping block.

The evidence points towards Blizzard escaping the reaper's scythe, for now. First up is this Windows Central article, which both quotes anonymous sources to the affirmative and has an email from Blizzard President Johanna Faires that reads: "While you can expect to hear more details regarding the day's events and what they mean for Blizzard in further communications."

Then, there's narrative designer and union member Benjamin Wagner, who wrote: "No union employees at Blizzard were impacted by today’s bloodbath—and I sincerely doubt that was because the powers that be think that we’re all vital. Odds are, they wanted easy cuts. Status Quo makes you not easy."

Not every worker at Blizzard is unionised, but there's also this statement from the World of Warcraft Gamemakers Guild-CWA, posted here by the union's Reddit account to the r/WoW subreddit. In it, the union expresses solidarity with "all other affected studios" which, by process of elimination (and the other posts above) suggests a relatively near-miss.

Lastly, Bloomberg's Jason Schreier writes: "The staff of Blizzard Entertainment were told today that they won't hear how the reorganisation impacts them until 'further communications'."

That last bit is, indeed, what I can imagine feels like a great sword dangling over the heads of every Blizzard developer. Not only because this isn't the first time Microsoft has made cuts to the studio—an acquisition-led bloodbath immediately after its purchase, for instance, saw many developers left in precarious situations by the unfeeling corporate growth machine.

But also because, as stated in that announcement post, Xbox is far from finished. Around 1,600 roles have been removed, but by 2027 another 1,600 jobs will be lost. Which I'm sure is absolutely splendid for morale, and won't have any deleterious effects on an already-terrified workforce. You simply have to give it up for Microsoft. Is it clear I'm gritting my teeth, yet?

The maddening thing here is that I cannot genuinely think of a world in which Blizzard's games aren't raking in cash. We're talking about World of Warcraft here. Overwatch seems like a free money printer with its season passes and cosmetics—the same for Diablo 4. If there's a world in which Blizzard somehow isn't profitable enough, then I'm starting to think there's no corner executives won't plunder for a shareholder bump.

It could be worse, though—Zenimax Online Studios has been hit far harder, with the Elder Scrolls Online developer suffering major cuts despite a fierce effort to bring the MMO back into the spotlight and bright plans for the future.

The latest mass layoff at Xbox will see roughly 3,200 people lose their jobs—1,600 today, and 1,600 more over the next fiscal year—and four game studios turned loose into the forest: Compulsion and Double Fine as independents, Ninja Theory and Undead Labs under new ownership. It's bad no matter how you look at it, a reflection of flailing leadership at Microsoft and a dreadful state of affairs for the game industry as a whole.

The bloodletting has inspired a range of reactions across the internet—and yes, there is a small subset of the gaming population celebrating what it sees as a victory of 'real gamers' over some imaginary ideology that holds too many game studios in its grasp.

For the most part, though, the responses are shocked, sorrowful, angry, and even among those who insist these cuts were necessary, filled with regret.

Griffin DeClaire, who was laid off from Bethesda Game Studios today, said the cut came as a complete surprise because he was just told he'd be getting a raise. "I really don't know what my next steps are," DeClaire wrote on LinkedIn.

Arkane founder Raphael Colantonio, who left the company in 2017 and now heads up WolfEye Studios, embraced a bit of dark humor in response to Sharma's statement:

We initially thought that Obsidian, which isn't mentioned in Sharma's announcement, had escaped the axe, but that later proved to be false: Narrative lead Kate Dollarhyde said on Bluesky that the studio "lost many excellent developers and wonderful people" in the layoffs.

Among those let go was Daniel Alpert, who joined the studio in 2005—just two years after it was founded—and most recently served as art director on The Outer Worlds games.

Alpert said he was grateful for having spent more than two decades at Obsidian but added, "We are clearly at a turning point in the games industry. These past months have been difficult for so many talented people, and unfortunately, it seems the challenges aren't over yet."

Larian's publishing head Michael Douse was as surprised as any of us to discover that through all these years, Xbox did not have a chief operating officer.

Gloomwood developer Dillon Rogers pointed out the incongruity between Sharma's stated commitment to Bethesda's biggest franchises, and gutting the studios that make them:

Mike Kern, who was laid off after nearly 14 years at ZeniMax Online Studios, noted the obvious difficulty that many in his position don't talk about publicly: The videogame industry simply cannot reabsorb all these people. Talent is going to be lost on a massive scale.

Dan Callan, a former designer who was let go amidst last week's layoffs at that company, reflected on the deep and inescapable shittiness of pre-announcing 1,600 layoffs that will happen over the next fiscal year.

This was the best part about the last year of Bungie, through multiple layoff cycles it was a daily battle between survivor’s guilt and waiting for the other shoe to dropI would reiterate people will not make a good video game under these conditions but that assumes any of these ghouls care

— @danjamin.bsky.social (@danjamin.bsky.social.bsky.social) 2026-07-06T22:08:18.292Z

Jason Schreier of Bloomberg shared the same sentiment, saying that Blizzard employees are being left hanging until further notice.

Case in point: the staff of Blizzard Entertainment were told today that they won't hear how the reorganization impacts them until "further communications"

— @jasonschreier.bsky.social (@jasonschreier.bsky.social.bsky.social) 2026-07-06T22:08:18.063Z

Others pointed out that the cuts come as Microsoft continues to pour billions of dollars into a pursuit of AI that seems to be growing increasingly desperate, including notable AI industry critic Ed Zitron, who had some harsh words for all involved:

This sounds insane until you remember that Microsoft is ALL IN on Ai. These folks believe most of us will be out of work in the next 5 years, drawing from UBI. What will we do with all that time? XBox hopes we'll spend our time & money with them. Dystopian thinking.www.pcgamer.com/gaming-indus...

— @crobertcargill.bsky.social (@crobertcargill.bsky.social.bsky.social) 2026-07-06T22:08:18.814Z

Sure Microsoft may have fired thousands of people and gutted its games division but at least it had more money to pour into Copilot, the 4th most popular AI, a product nobody wants or likes except rich executives, that is constantly losing horrendous amounts of money

— @oldpappythomas.bsky.social (@oldpappythomas.bsky.social.bsky.social) 2026-07-06T22:08:18.503Z

But AI-focused employees aren't immune: Kevin Flynn, a commerce growth and AI product manager who said he'd increased "PM AI adoption from 12% to 91% in 3 months by building a PM specific AI harness," revealed on LinkedIn that he'd been let go.

"The last four years have been brutal in the industry," Epic Games lead level designer Scott Maclean said in his own post about the layoffs. " I’ve not seen anything like this in my 25 year career. I keep expecting it to normalize, to balance out, but that seems to not be the case."

Keith D. Boney, a former user researcher at Bethesda whose entire team was impacted by today's layoffs, shared a similar thought, writing that "this recurring trend in the Games industry is one that is extremely detrimental to psychological safety, let alone fiscal stability."

There's more, of course, but the inherent absurdity of supposedly serious executives talking nonsense about entertaining "more than a billion people each day," which PC Gamer's Harvey Randall aptly described as "delusional," has a way of making it all feel a bit futile.

Layoffs like this, which have become par for the course since Microsoft swallowed up Activision Blizzard in 2024, are outrageous and heartbreaking, and there has to be a better way. But as we careen from "never looked stronger" to "our business today is not healthy" over the course of a single year—both of them resulting in layoffs—I find myself wondering if we're ever going to find it, or if we're just going to keep howling into the social media void until there's nothing left.

FromSoftware president and game director Hidetaka Miyazaki is one of the most revered names in today's games industry. Even figures like legendary former Tekken boss Katsuhiro Harada hold him in high esteem: Recently asked on X about his opinion of Miyazaki, Harada said the Dark Souls creator is a "rather unique, yet extremely serious game developer."

But while he called Miyazaki's career "remarkable," Harada said it's one that isn't fully appreciated by those touting FromSoft's achievements, because more attention is paid to the breakout sales successes of the Souls games than the gradual growth of the developers that made it possible.

What makes Miyazaki's career "so unique," Harada said, is that the FromSoft director was a relative latecomer to game development. After working as an Oracle account manager, Miyazaki made an abrupt decision to pursue a game dev career at age 29 after becoming enraptured with Ico on a friend's suggestion. Given his lack of industry experience, few companies were willing to consider his application—but FromSoft did.

"It's remarkable that someone who wasn't even a game developer during the dawn of the polygon era eventually became one of Japan's most representative game creators," Harada said. "In other words, compared to the rest of us from the same generation—including myself—his career path is exceptionally unusual. Most notably, unlike many of us, he was not working at one of the major development studios that held a significant technological advantage during the early polygon era."

First working as a designer on Armored Core: Last Raven, Miyazaki would later shift into a director role on Armored Core 4 and For Answer—and eventually, Demon's Souls and Dark Souls. While Dark Souls' ascendance as a global phenomenon might have seemed like it emerged out of nowhere, Harada said his tenure as Bandai Namco producer and marketing general manager—a tenure that overlapped with the Souls series and Elden Ring development—allowed him to appreciate how FromSoft had honed its craft as a studio.

"From that perspective, I can say that Dark Souls didn't suddenly become a massive success overnight," Harada said. "It was the result of everything Miyazaki and his team had built up through their previous titles."

According to Harada, the acclaim that FromSoft enjoys feels like "almost complete reversals in attitude" compared to "the days when [Miyazaki] and his team were struggling the most." It was a contributing factor to his own exhaustion with people who he says can only judge a game's merits "by saying things like, 'That title cost X billion yen to make and sold Y million copies.'"

"There were so many people who couldn't appreciate the journey or the growth of the developers themselves," Harada said, expressing surprise that "even if people couldn't properly evaluate that journey, nobody seemed interested in trying to understand the process of how those developers gradually reached where they are today."

He made sure to clarify that he wasn't talking about fans, indicating that there may have been some on the business side at Bandai Namco who didn't have much patience for game devs' long-term professional development. (Given today's wide-ranging Xbox layoffs, that's evidently an international issue.)

As for Miyazaki himself, Harada says the FromSoft director seems to have a pervasive case of impostor syndrome. According to Harada, Miyazaki's discomfort with appearing in video interviews is due, in part, to a feeling that his own understanding of game development "is still shallow" and that he's not in a position to speak about the discipline authoritatively—a notion that the Tekken boss thinks is absurd.

"It's common for well-known developers to say, 'I still have a long way to go,'" Harada said, "But whenever someone like him says that, my reaction is always, 'Come on, if you say you're still not there yet, then the rest of us won't feel qualified to talk about games at all.'"

Original story: Curiously absent from today's mass layoff announcement at Microsoft was legendary RPG studio Obsidian Entertainment, which thus far had navigated Xbox's 2020s layoff waves unscathed. Not anymore: An indeterminate number of developers has been laid off from the company, according to social media posts from current and former employees. I have reached out to Obsidian for comment, and will update this story if I hear back.

Rebs Gaming on Twitter documented four developers who shared their own experiences on LinkedIn, and I was shocked to see artist Daniel Alpert among those laid off. Alpert has been with the company for 21 years, with credits on Neverwinter Nights 2, Fallout: New Vegas' DLC, Alpha Protocol, and most recently The Outer Worlds 2. On the opposite end of the spectrum, engineer Wenzheng Huang had only just started at the company in May.

In addition to Huang, Alpert, area designer Tyler McCombs, and communications producer Geoffrey Fogle, writer Jay Turner has shared that he was laid off from Obsidian. Turner's only credit with Obsidian was Avowed, but his industry experience stretches back to the golden age of BioWare: Turner is credited on Jade Empire, Dragon Age: Origins, Mass Effect 2, and many more games.

Pentiment artist Soojin Paek, Avowed narrative designers A.K. Fedeau and Katie Tenney, as well as Avowed area designer Bre Seale also number among those affected by today's layoffs. That brings the total count to nine at the time of writing. Both Turner and Obsidian narrative lead Kate Dollarhyde (who remains at the company) characterize the layoffs as significant in scope.

As a company of over 100 employees (285 in 2025), Obsidian is obligated by the WARN Act to provide advance notice of layoffs in excess of 50 employees. The California WARN Act Tracker does not show Obsidian as having reported its layoffs. This would have put today's count at between nine and 49 people, though Kotaku reports that the final count is 60-70 employees laid off.

Numerically a drop in the bucket compared to the 1,600 laid off across the entirety of Xbox, with 1,600 more in the next 12 months, but every one of those figures is a life that's been upturned. What's more, Obsidian is a legendary RPG studio, one with four games in our 2025 Top 100 list (Pentiment, Knights of the Old Republic 2, Deadfire, and New Vegas). In recent years, the studio has gone from strength to strength with the heartbreaking Pentiment, breakout Grounded series, as well as the criminally underrated Avowed and Outer Worlds 2.

Obsidian followed Xbox's presumed previous mandate, to release a high volume of quality games to support Game Pass, to a T, pushing a pace largely unheard of in the modern industry: Five games in five years, from 2020 to 2025. Its developers have been punished in spite of that success.

With Xbox floundering and 1,600 more layoffs expected at the gaming division in the next 12 months, I've never been less secure in Obsidian's future⁠—and let me tell you, I'm rooting for its 100-year plan. Obsidian reached its 25th anniversary despite almost going under multiple times in its history.

It would be criminal to lose the studio in the coming years because Xbox was not profitable enough, and Satya Nadella needs to fish more change out of the couch cushions to throw at AI datacenters and Copilot, the fourth most popular chatbot that lies to you.

The latest double whammy that both Grand Theft Auto 6 and PlayStation will soon be ditching disks and going digital has angered fans and roused old discussions of what ownership of videogames and players rights will look like in a digital future. Spoiler alert: it's not great, that's if Hideo Kojima's preminitions are anything to go by. But there are some who are willing to put up a fight.

One such person is none other than La France Insoumise leader Jean-Luc Mélenchon, who recently took to social media to say the following: "With GTA 6 without a disc in 2026 and Sony's announcement of the end of physical disc sales for games in 2028, the question arises of how we view these products.

"You will pay without ever owning anything. No loan, no resale, no guarantee of keeping what we've paid for. Videogames are not mere merchandise—they are cultural assets, and the law in force must apply to them."

As it turns out, Mélenchon is sharing a petition to save physical videogames in hopes of combatting a future where game ownership doesn't actually exist. "With the end of physical games, the videogame industry wants to impose a fully digital model on us, where access will be conditional and time-limited," he continues. "The buyer's rights will be denied. This is the triumph of total commodification: you pay full price for nothing more than a simple revocable right of access."

Mélenchon is right, and he's saying what we're all thinking. If ownership rights of digital media aren't expanded upon then mediums such as games will suffer for it. With no control over how we preserve the games we buy and cherish, we run the risk of losing older games that serve as the foundation for our industry and all the rest that follow suit, or as Mélenchon puts it, "our cultural heritage".

Today's Xbox layoffs may have hit Bethesda and ZeniMax particularly hard, as reports of "significant" cuts have begun to surface and the Bethesda Game Workers Union says that "many" employees at Bethesda Game Studios have been let go.

Today's announcement of major layoffs at Xbox and the spinoff of four studios—Compulsion Games, Double Fine, Ninja Theory, and Undead Labs—also included word from CEO Asha Sharma that company is "making reductions across other units, and in some cases, shifting investment to focus on higher priority projects. These changes vary in size across Activision, Bethesda/ZeniMax, Blizzard, King, Mojang, and Xbox Game Studios."

Details on studio-specific cuts haven't been announced, but Bloomberg's Jason Schreier said on Bluesky that ZeniMax Media, the parent of id Software, Bethesda Softworks, ZeniMax Online Studios, and others, "will be impacted significantly by the reorganization," although he added that Bethesda will not be pared down to just Fallout and The Elder Scrolls teams, as some reports have claimed: "The publisher will also still work on Wolfenstein, Doom and Quake."

But some of the studios responsible for those games are also reportedly being hit hard: "Studios in the Bethesda organization like id Software (Doom) and ZeniMax Online Studios (Elder Scrolls Online) are not shutting down but are cutting a significant number of staff this morning, per sources," Schreier added in a subsequent post.

A separate statement from the Bethesda Game Workers Union, the "wall to wall" union that formed in 2024, also indicated that the cuts run deep.

In what is becoming a stressful annual routine, Microsoft has decided to lay off thousands, including MANY of us at Bethesda Games Studios. With over 10k developers already cut from previous rounds, those at the top have deemed that insufficient in fixing their mistakes.

— @bethesdaunion.bsky.social (@bethesdaunion.bsky.social.bsky.social) 2026-07-06T16:29:42.450Z

"In what is becoming a stressful annual routine, Microsoft has decided to lay off thousands, including MANY of us at Bethesda Games Studios," the union wrote on Bluesky. "With over 10k developers already cut from previous rounds, those at the top have deemed that insufficient in fixing their mistakes.

"Today we say goodbye to many of our friends and colleagues and to hundreds more across Xbox, including folks that have worked at Bethesda Games Studios for decades. When will this cycle of cuts in pursuit of ever-greater profits end?"

I've reached out to Bethesda and the Bethesda Game Workers Union for more information and will update if I receive a reply.

In today's announcement of a staggering 3,200 layoffs at Xbox, the fate of one fan (and PC Gamer) favorite studio was left up in the air. Arkane Lyon, the remaining half of the modern immersive sim maestros, appears to be entering negotiations for an indie exit similar to other former Xbox studios.

"In France, Arkane's management is beginning required consultation with its Works Council to review potential strategic options," Xbox CEO Asha Sharma wrote in her missive on the mass layoffs. Former Kotaku editor Stephen Totilo has more context in his newsletter, Game File.

According to Totilo, Arkane is "also slated for an exit" similar to Double Fine, Undead Labs, Compulsion Games, and Ninja Theory. "Given local laws, though, Microsoft has been unable to explore its future—ranging from sale, to management buyout to shutdown—until today," Totilo wrote. "The fate of the Blade game is contingent on the studio’s future."

On Bluesky, Totilo wrote that Arkane's negotiations with Microsoft could lead to "100+" layoffs at the studio, depending on what form its future takes. Similar to the UK, which mandates a month-long redundancy process in the event of layoffs, muscular French labor laws prevent the sort of abrupt, day-and-date layoffs we're used to seeing in the United States.

You can see the contrast most clearly with the fate of Arkane Lyon's dearly-departed, Texas-based twin. Arkane Austin was shut down by Microsoft in 2024, one of the first casualties of Xbox's ongoing disintegration.

Arkane Lyon's most recent game was 2021's Deathloop, the excellent Groundhog Day time loop immersive sim. Arkane announced an adaptation of Marvel's Blade in the summer of 2023, and we've heard little since⁠—though Blade has consistently remained one of our most-wanted games.

Previously, Arkane Lyon developed our 2016 game of the year, Dishonored 2, and Arkane Lyon level designer Romain Barrilliot was lead designer of Thief: The Black Parade, ModDB's 2023 mod of the year and a modern triumph of the immersive sim genre.

As for those affected, I've only seen a telling non-comment from Arkane level design director, author, and Through The Looking Glass forum co-founder Dana Nightingale. "All I know is I'm really excited for everyone to read and love my upcoming book," she wrote.

Arkane founder Raphael Colantonio, who left to start Weird West developer WolfEye Studios, had a cheeky response to Asha Sharma's layoff announcement post on Twitter: "Regarding Arkane… how much? I’m asking for a friend." Colantonio was likely joking, but stranger things have happened, and I think we're all waiting on a hero here.

You can imagine the golden path: Minimal layoffs and an independent Arkane, or maybe ownership by an eccentric-yet-benevolent French billionaire who loves immersive sims. But that's far from certain, and like many immsim fans, I'll be contributing spirit bomb energy in hopes of a happy outcome. All I know is that Arkane has a design pedigree stretching all the way back to Origin Systems and Looking Glass Studios in the early '90s, and it would be a tragedy to have that ended by feckless corporate spreadsheet thinking.

The time has finally come for Xbox's massive reset—in a statement on the official Xbox site today, recently-minted CEO Asha Sharma revealed the fate of several studios. I won't be focusing on them in this article (although you can read the words of my fellow PCG writer Andy Chalk first, if you'd like).

Instead I want to highlight (with the deserved scrutiny of a post announcing the threatened livelihoods of thousands and people) Sharma's closing paragraph, because it's borderline delusional.

"I want XBOX to be one of the few companies that entertains more than a billion people each day and gives everyone the opportunity to create and connect. I know we can achieve this goal. XBOX has many of the most beloved franchises in entertainment history, talented studios around the world, and we will return to growth in 2027."

A billion, need I remind you, is a thousand million—to give you a sense of scale, a million seconds is 11.5 days. A billion seconds is 31.7 years. A grain of sand is around 0.4mm in diameter. If you made a chain of them, a million grains would get you 0.2 miles, a distance you can walk in about five minutes. A billion grains would get you 248.5 miles, which'd get me, in the UK's south, halfway up to the top of Scotland.

Or, hell—let's talk about videogame subscribers as a metric. World of Warcraft, a videogame Microsoft currently owns, hit a peak of 12 million subscribers during Cataclysm. 12 million players, the absolute highest point of one of the most popular MMORPGs ever created, the literal biggest fish in the genre? That is 1.2% of a billion.

And we're just talking about subscribers, not daily players. Sharma wants a daily playerbase that is the equivalent of 83 World of Warcrafts at their highest peak, all logged in at the same time. Counter-Strike, the most popular game on Steam, had an all-time peak of 1.8 million. She wants 555 Counter-Strikes every day.

Speaking of Steam, the platform hit 41 million concurrent users last year. Sharma wants 24 Steams at their all-time record heights. 24 of them. Even if we're a bit more charitable and assume that, say, Steam hitting a peak of 41 million means 60 million players logged into it on that day. That's still 16 Steams.

It's a quite frankly delusional figure that's nonetheless a perfect encapsulation of the runaway irresponsibility of Microsoft in the past few years. Multiple promising studios shut down, huge acquisitions, rampant AI spending—all of which, you might think, would make the executive class wonder if they were maybe aiming a little too high.

But not Sharma, no no no. We must entertain a billion people each day, she bravely shouts, we must be 24 Steams, and we can be 24 Steams.

And, naturally, we must do so by demanding that fewer people do more work. Sharma says she wants all of this with the same breath in which she announces Xbox will have 3,200 fewer people working for it by 2027.

The quite frankly insulting final paragraph of Sharma's corporate diatribe is an example of the exact plague that's boiling the videogame industry alive. There is no room for humility or self-reflection. Sharma must promise the mathematically impossible to save face, or, I can only assume, violate some arcane dogma and burst into flames. Microsoft's year of shame is getting a sequel.

Today, Xbox announced what it calls "the most significant restructure in Xbox history": Part of a larger downsizing at Microsoft that's putting 4,800 employees out of work, the reorganization will eliminate 1,600 Xbox roles today, with the division aiming to reduce its headcount by 3,200 throughout the 2027 financial year.

Alongside the layoffs, four game development studios are leaving Microsoft ownership for new management, including South of Midnight and We Happy Few developer Compulsion Games. Previously reported as facing imminent closure, the award-winning Montreal-based developer is instead returning to independent studio status and maintaining ownership of its IP and games catalog.

An important update from Compulsion Games.

— @compulsiongames.bsky.social (@compulsiongames.bsky.social.bsky.social) 2026-07-06T15:50:11.169Z

"Today, we're sharing that Compulsion Games will return to independent management following our time as part of Xbox. As part of this transition, we will retain the rights to Contrast, We Happy Few, and our award-winning South of Midnight," Compulsion Games said in a statement on Bluesky. "We're grateful for the years we spent with Xbox, for the support they provided our team, and for the opportunity to bring these games to players around the world."

While the studio says it's "excited to continue building the distinctive games that define Compulsion," its first steps with its newly-regained independence will be focused on its staff.

"Our immediate priority is to support our team throughout this transition period," Compulsion said.

Last month, reports suggested that Xbox's looming reorganization has placed Compulsion at imminent risk of closure—a suggestion made more credible by Compulsion employees who had posted on LinkedIn and other platforms indicating they were seeking work. The status of those employees, and whether Compulsion can be expected to make further cuts to account for the financial pressures of transitioning to independent management, is currently unclear.

"We are confident in the future of Compulsion Games and look forward to this next chapter where one thing will remain constant: We will create unique games that tell important stories, all with the goal of touching the hearts and minds of our players."

The axe has fallen on Xbox, which announced another major round of layoffs that will see approximately 3,200 people put out of work, with 1,600 losing their jobs today and another 1,600 to follow over the course of the company's fiscal year. Four studios—Compulsion Games, Double Fine, Ninja Theory, and Undead Labs—will also "leave Xbox to new management," as CEO Asha Sharma put it.

None of those studios will close as a result of today's cuts, which is the only upside to the whole thing: Compulsion and Double Fine will go independent again, "with their IP, catalog, and runway for their next games," Sharma said, while Ninja Theory and Undead Labs are being sold to unnamed new owners.

The situation may be grimmer for Arkane, where "management is beginning required consultation with its Works Council to review potential strategic options." Further details aren't provided but in France, where Arkane is based, and other EU nations, employee consultations are a mandatory part of the layoff process. There's no mention of the Blade game Arkane is currently working on.

Xbox is also "making reductions across other units," including Activision, Bethesda/ZeniMax, Blizzard, King, Mojang, and Xbox Game Studios, although Sharma said no ongoing projects will be cancelled. Minecraft studio Mojang and the mobile studio King will also now report directly to Sharma.

Sharma declared that "our business today is not healthy" as a prelude to the cuts, a statement made almost exactly one year after her predecessor, Phil Spencer, declared that "our platform, hardware, and game roadmap have never looked stronger" as he imposed mass layoffs of his own in 2025. Sharma also repudiated Spencer's all-in bet on Game Pass and multi-platform releases, saying that while they "created meaningful value, they did not grow at the pace we expected."

We've watched the slow death of physical games media for a decade now, whether it be discs costing more, digital-only consoles, or the recent revelation from PlayStation that come 2028 it will cease productions of videogame discs. It's nerve-wracking for videogame conservationists, player's rights advocates, fans of the hobby, and even Hideo Kojima himself.

Kojima already used his wicked foresight to predict the conundrum we find ourselves in today, but now he's discussed the current state of videogame affairs, and he seems just as worried as he was years ago.

"Since [disc] production is ending in 2028, this is about videogames, but I grew up with physical media, so I find it really sad," Kojima explained during a panel at the Il Cinema in Piazza film festival (via Genki). "Currently, I've been buying up a lot of Blu-rays, such as various movies, and CDs too."

I'm no Nostradamus, but the fact that Kojima is currently stockpiling physical media probably isn't a good sign. Game preservations seem to be at such a dead end right now that one leader went as far as to claim the only option for preservation in a discless future is piracy.

"The situation is different for games, as they are downloaded to the hard drive, that means the game data remains on your own hardware," Kojima continues. "However, if thing shift to streaming in the future, that won't be the case anymore.

"With streaming subscription services, like Netflix or Amazon, there is a server somewhere, and you essentially just have the right to turn the tap, and when you do, the data flows out. That's how movies work on these platforms, right? You don't download the data, you access it directly through a subscription. And the consequence of that is that you don't actually possess the data yourself."

The activist group Stop Killing Games has been hard at work for years now lobbying government officials and industry leaders in an effort to get better consumer rights laws for those who own digital media. One way in which the group has attempted to improve circumstances is to advocate for better end of life planning for games.

"There are companies that own these servers and let you 'turn the tap' for a monthly fee," Kojima adds. "However, with nations, politics, and various ways of thinking, one naturally has to consider the possibility that if there is a change, the data inside will stop being distributed. And if that happens you won't be able to watch or play the movies and games you like. That is what is frightening."

As a final warning to attendees, Kojima explains how what is currently happening in the games industry is like a warning light for the rest of the media landscape: "What is happening to videogames in 2028, might also happen to movies. I'd like everyone to keep that in mind."

Watch Dogs 2 is currently $2.50 on Steam. It's hardly a classic, but it's not terrible either. At one cent per 10 minutes of content, how can you resist? It's only five pleasantly tactile mouse clicks away.

Maybe you can't resist. During Steam's seasonal sales it's possible to scoop up dozens of games for less than $5 a pop. Ted Litchfield found 31, many of which could individually keep you occupied for weeks. The temptation to splurge is probably irresistible, especially if you've been bitten by some of Steam's incentives to hoard: maybe you love to customise your profile using Steam points, for example. Or maybe you love trading cards. Or maybe you just find pleasure in watching your library grow.

Or maybe, one day, you really will find the time to play through Dead Island 2, even though you don't like zombie games, or first-person games, or games set in Los Angeles. For $5, it's an investment in case you change your mind about all of those things. I'm assuming that was the logic which led to the mysterious appearance of Gotham Knights in my library: I don't like Batman, I loath superheroes, and I can't stand grindy, icon strewn open world games.

As Mashable reports, Korea has a cost-free answer to the dopamine hit that comes with impulsive online purchases. FoodNeverComes is an app that simulates the shambling, shallow pleasure that comes with making an online transaction, except you spend no money. The user can browse a list of restaurants, select from dozens of menus, take pleasure in pressing "purchase", and then watch a fake GPS delivery tracker transport goods that never come. That's just one example of a growing number of these fake purchase sites, dubbed 'dopamine sites'.

As psychologist Dr. Gabrielle Schreyer-Hoffman tells Mashable, "We do see people use social media, shopping, and buying food to fill voids and avoid being present. Maybe you don't spend the money, but you're not really dealing with the core issue, which is: Why are we going to these websites to do this?"

Is it sometimes more pleasurable to buy games than to play them? I'm no psychologist, but reading about these Korean dopamine sites immediately puts me in mind of my Steam backlog. I wasn't surprised to find that someone has made a dopamine hit website themed around the current Steam summer sale.

At steamsalesimulator.com, developer Mike Wing has replicated Steam pretty much exactly. You can click "add to cart" on everything, add endless thousands of dollars to your wallet, and then hit that blessed "continue to purchase" button which triggers a succession of melodious, life affirming, congratulatory, slot machine-style chimes. Occasionally, Gabe Newell himself sends you a randomised gift. (Thank you, fake Gabe for gifting me fake Wall World). There's even a community market where you can buy fake cosmetics: for $0.09, I copped a Distinguished Antique Endtable for Don't Starve Together. Feels good, man.

After around ten minutes spent on that website I accrued 49 games, reached Steam level 51, and saved a total of $977.73. And I still feel barren inside.

The rise of these dopamine sites reminds me a little of the birth of modern idle games. When incremental games like Candies and Cookie Clicker appeared on the scene in the early 2010s, most people received them as a joke. I remember the widespread expression of bemusement on social media as people acknowledged the genre's satirisation of RPG levelling up mechanics. I remember droves of people—including myself—realising they were, by accident, fixated on these exquisitely meaningless toys, these lizard-brain feeders. Now there are hundreds of clicker games on Steam: it's a legitimate genre that people pay money to play.

So while I absent-mindedly click around Steam Sale Simulator, purchasing Russian Life Simulator, Lords Mobile and Sword and Fairy 7 because why the heck not, I wonder how many weeks will pass before everyone's wasting precious minutes of their life interfacing with fantasy ecommerce storefronts.

Top Steam games by revenue (June 23 - 30)

Steam releases its top sellers charts on Wednesdays, so the below chart doesn't factor in some late week releases. Not that anything of any particular interest released: it's extremely quiet out there.

Meccha Chameleon has now sold 15 million copies, so it's unsurprising that it topped last week's revenue chart. Cyberpunk 2077 held its spot at No 4 thanks to its current all-time low 75 percent discount.

Significantly, The Binding of Isaac: Rebirth hit a new concurrent player count record last week (130,954) thanks to its all-time low 90 percent discount, which also applies to the Afterbirth+ bundle. Modern Warfare 2 also saw a huge spike due to its 90 percent discount—it's extremely rare for COD games to go that cheap.

Dota 2 got a new event in late June, which explains its appearance last week.

Last week's Steam deep cuts

Steam review of the week

"It's okay to kill people and throw them into an eldritch flesh-pit as long as they deserve it.

Is it a game about materialism? Is it about found family?

All I know is, it feels super cathartic to finally tackle and stab someone 58 times after being chased by a giant tree."

Failgirl69, ruminating rather disturbingly on Feed the Pit.

Thick as Thieves developer OtherSide Entertainment has laid off 18 employees, according to a Game Developer report, a move that comes just two weeks after the studio laid off 17 people following the cancellation of a new game it had in development. A studio rep told the site that following this round of cuts, "fewer than 10" people remain employed at OtherSide, working on updates for Thick as Thieves, and that there are "currently no plans for the studio to work on any future games."

"OtherSide’s DNA is built on immersive sim games that have lengthy development cycles," the rep said. "This, unfortunately, has been an increasingly challenging space to occupy in recent years. Despite the encouraging response to the launch of Thick as Thieves' introductory campaign, it has become clear that the continuation of the studio in its current shape is no longer a commercially viable path."

It's true that immersive sims have a hard time in the modern game market. As Nightdive CEO Stephen Kick said earlier this year, they generally appeal to "a very small, niche group," and thus tend not to be huge sellers. This limits the appeal of the genre to developers and publishers alike, especially in the current era of 'make a huge hit or immediately go out of business.'

But Thick as Thieves made some misplays, too. After being announced and promoted as a PvPvE game, Otherside announced a new direction shortly before launch as a singleplayer/two-player co-op game. It was pretty good when it came out and had plenty of room to grow, but some of the game's mechanics—particularly the mission time limit and exit countdown—were, and are, grating. For people looking for a modern Thief-like experience, Thick as Thieves just wasn't quite it.

Thick as Thieves was also relatively tiny, offering an estimated four hours of gameplay out of the box. To compensate, Otherside priced it at just $5/£5/€5, which it hoped would be low enough to attract a sizable audience of players and "give the team the flexibility to develop additional content informed by how players engage with the game." Judging by the player counts on Steam, though, that's not really happening.

As a fan of immersive sims, and Thief in particular, I hate to see this outcome. Thick as Thieves wasn't quite what I was hoping for in the way of a proper Dark Project follow-up, but I wanted it to succeed so OtherSide could continue to work on bigger and better things in the field. The world needs more immersive sims! I need more immersive sims! Underworld Ascendant was an extremely unfortunate misfire, yes, but I was really holding out hope that a new Thiefly game from two of the OG immsim guys would have the juice. Alas.

There's no official indication at this point that OtherSide will close, but with the cancellation of the project codenamed Argos in June and this latest round of cuts leaving such a small number of employees at the studio, it's hard to imagine where else it might go from here. I've reached out to OtherSide for more information and will update if I receive a reply.

Former Call of Duty strategist Robert Bowlling, whose ill-fated venture with Midnight Society came to an end in 2025, is taking another shot at the game business. In a message posted to LinkedIn, Bowling said he's co-founded a new studio with "a killer team," and while nothing was said about what it's currently working on, the studio is called //18.bravo and that sure sounds like something to me.

The something in question, in case I'm being too cryptic here, is an utterance by someone in the Captain Price mold as he prepares to unleash havoc upon the foes of freedom and democracy—which in turn leads me to assume a shooter is on the way, likely of the modern military sort.

Bowling's CV would suggest the same: He's been in the game industry for a long time and held numerous positions at various studios, but is best known for his years at Infinity Ward, where he became the community face of the Modern Warfare games as "fourzerotwo" until his departure in 2012.

Today's announcement, though, is all about the studio itself: Bowling said the new outfit "ties leadership compensation to employee success," has a royalty program for employees, and will share profits with "external talents" like voice actors and contractors.

He also said the new studio is "not supporting live service" with its debut project, and maybe even more notably given the growing pushback against game shutdowns, said it is being built with a focus on enabling "forever play": Dedicated servers will be supported when the game goes live, but it will also incorporate "optimized P2P architecture that allows the community to play together even if the company moves on."

Bowling also committed to open-sourcing code, assets, "and everything required to extend the game (except 3rd party integrations and licensed music)" if the new studio goes under. "Most importantly," he wrote, "we will be releasing all the legal paperwork and processes that make this possible publicly so the model can be replicated easily and at low cost to those who decide to mimic the model."

That's easy to say and perhaps a bit trickier to do—follow-through is the real tale of the tape—but even so, Bowling's declaration is notable in the current industry environment. Online gaming is tremendously popular, but games that are dependent on external servers for functionality are also very delicate: When a company shuts down—or merely decides that it's not making enough money—they're effectively lost, with no recourse for players.

Consumer movements like Stop Killing Games have begun to push back on that behaviour, although with limited effectiveness thus far. So while committing to building a game that won't immediately die if it fails to achieve arbitrary revenue numbers shouldn't be a big deal, right now it kind of is.

Amazon Game Studios boss Christoph Hartmann left the company earlier this year amidst its move away from big-budget game development and embrace of AI-powered slop. There was no indication at the time as to what he'd get up to next (in fact, I don't think his departure was ever publicly confirmed by Amazon), but now we know: He's signed up with Ubisoft.

Hartmann, who prior to joining Amazon had a long run at Take-Two including 14 years as president of its 2K Games publishing label, will head up Ubisoft's still-needs-a-proper-name Creative House 2, one of five "creative houses" that emerged from the company's recent restructuring.

That will put him in charge of Tom Clancy franchises The Division, Ghost Recon, and Splinter Cell—although the premier Tom Clancy game, Rainbow Six Siege, will remain with Vantage Studios, formerly known as Creative House One—as well as the March of Giants MOBA Ubisoft acquired from Amazon in 2025.

"Christoph is exactly the kind of leader we needed for Creative House 2—a passionate gamer with a proven ability to bring out the best in creative teams and build franchises that last," Ubisoft CEO Yves Guillemot said.

"His experience across development and publishing as well as his management style give him a rare understanding of what it takes to make great games. I am confident Christoph will elevate our teams and brands to new heights and deepen their connection with the dedicated players who love these franchises."

In his own message on LinkedIn, Hartmann said he's "excited to get started" with his new gig.

"For nearly four decades, Ubisoft has created some of the industry’s most iconic franchises and earned a reputation for building ambitious AAA experiences that have entertained millions of players around the world," Hartmann wrote. "It has long been a company I’ve admired for its creativity, the strength of its franchises, and, above all, the talented people behind them.

"My goal is simple: create an environment where talented teams can do their best work and continue building games that players love."

While Hartmann is a significant addition to Ubisoft's executive lineup, the company's seemingly endless thrashing in the water has also cost it some notable names with serious institutional knowledge, including former Assassin's Creed franchise boss Marc-Alexis Côté, former Assassin's Creed Hexe creative director Clint Hocking, and former Assassin's Creed Hexe game director Benoit Richer, all of whom have departed the company in recent months. In June, Ubisoft closed two studios, in Winnipeg and Belgrade, and laid off hundreds of employees; a report at the time by French site LesEchos claimed that further cuts at Ubisoft's American operations are expected, although those cuts have not yet materialized.

We have unfortunately been barrelling towards a digitised future for some time now, but Sony's latest news that PlayStation will be fully digital by 2028 has heightened fears that players have about ownership and the inability to preserve art. The fear is so palpable that people are looking back on Hideo Kojima's old take on the situation.

"Eventually, even digital data will no longer be owned by individuals on their own initiative," Kojima says in a social media post. "Whenever there is a major change or accident in the world, in a country, in a government, in an idea, in a trend, access to it may suddenly be cut off."

This has been a very real fear for quite some time now, with the Stop Killing Games being one group to lead the charge against a lack of consumer protections, although its latest bid for rule changes unfortunately fell flat in front of the European Commission:

"The Commission considers that at this stage it cannot propose a legal obligation to keep videogames playable after they stop being provided commercially. This is due, also, to existing intellectual property rights. Under EU copyright law, rights holders enjoy exclusive rights over their creations."

Players are (quite rightly) worried that without physical media their beloved games, or any kind of art, can be ripped away from them at a moment's notice. "We will not be able to freely access the movies, books, and music that we have loved," Kojima adds. "I would be a have-not. That's what I'm afraid of. This is not greed."

Unfortunately, it's not uncommon nowadays for a fairly popular game to go the way of the dodo and kick the bucket while still having somewhat of a dedicated fanbase. Late last year Amazon cancelled MMO New World despite it having concurrent player peaks of 60,000 strong.

More recently, we've watched that sad demise of Destiny 2, as Bungie announced its decade-long story would be wrapped up in its biggest ever quality-of-life update which was released at the start of last month. Servers are still up, but with no future updates, the cheating and matchmaking will only get worse from here.

We're certainly walking into unstable and under-legislated ground, and PlayStation's latest decision furthers that uncertainty by removing the choice of physical games players used to have. Perhaps the Video Game History Foundation is right, maybe the only way forward for true ownership and preservation of videogames is piracy.

Rockstar's a big company—and while we're excited for Grand Theft Auto 6, that doesn't sideline the studio's potential for cruddiness. Both from a consumer-facing point of view (like GTA 6 being fully digital) or an employee-facing one, with union-busting allegations in the UK still ongoing.

It looks like, even outside of that dispute, there are still problems. Union members who aren't embroiled in the current legal quagmire spoke to GameDeveloper about their experience with the studio, and it's not looking particularly solid there, either.

The developers, which the report states "chose to remain anonymous for fear of reprisal"—already a bad sign—go into a trio of problems with the company that's making things difficult. Namely bonuses, gender pay gaps, and crunch.

Firstly, that the lack of transparency around those bonuses makes it a useful carrot on the stick for leadership—and a mental nightmare of invisible chess for employees, given they've got no idea whether their bonuses will be good or not, or what even goes into one:

"The reasoning given for this is often nebulous," GameDeveloper is told, "Inconsistent between departments, even inconsistent between team members within the same department, and sometimes hinges on completely subjective or retroactive criticisms.

"They are under no obligation to show their working. Employees want good pay, and if literally anything they do that year could affect it, they will naturally feel they have to be as pliable as possible to their boss's whims."

The report also states that initiatives to address gender pay gaps were scrapped, and that night workers were no longer given extra compensation for their hours. It doesn't help that there's still reportedly an attempt to normalise crunch within the company.

In the UK, labour laws have a baked-in maximum working time of 48 hours a week unless workers opt-out. These employees claim that not only had Rockstar baked in that opting-out into their contracts, but that the steps towards opting back into the regulations (which every employee has a right to do) were obfuscated by the company, requiring a union campaign to inform them they had the choice.

"The union successfully ran a campaign to inform people they could opt back in to the regulations at any time, which resulted in Rockstar management simplifying the process and removing the obligation to meet with HR.

"Part of the problem with crunch is that there is not an agreed definition, and now it seems the company thinks that offering specific and limited compensation as an incentive for overtime means it no longer qualifies as crunch."

The employees claim, also, that this crunch is applied inconsistently across teams, with some who "seem to never get out of it—and often colleagues do not realize the opposite group exists".

Take-Two's response to GameDeveloper's request for comment is mostly boilerplate corporate stuff, but it's only fair I include it here, too: "We strive to make the best games possible by giving our talented teams world-class work environments and ongoing career opportunities. We have fostered a culture which is focused on teamwork, excellence, and kindness, and where we support and reward the team across all levels of the business through competitive compensation and benefits policies.

"We are proud that as a result, our employee retention is well above the industry standard. We have received a request from a union seeking to discuss voluntary recognition. We value an open and constructive dialogue with all stakeholders and will arrange to meet."

And hey, at least Take-Two's meeting with them—a low bar, but it's at least being crawled over. It might be that Rockstar's deciding not to get in hot water again while it's still legally tangled in another union-busting accusation.

Sony drove another nail into the coffin of physical videogames today, announcing that it'd cease production of PS5 discs in 2028. The future of the leading videogame console is total digital licensing, and according to the director of the Video Game History Foundation, that means the future of preservation, for the moment, must be piracy.

Responding to a Bluesky post calling piracy the "only extant form of media preservation that exists in games right now", VGHF director Frank Cifaldi agreed.

"As the director of a historical video game preservation institution, and someone who has dedicated his entire adult life to this cause, this is accurate," Cifaldi wrote. "We have attempted to work with the industry's trade organization to find a legal path forward, but they refuse to offer a meaningful alternative."

In a later statement from the VGHF, Cifaldi expanded on his criticism of the industry working against legal means of preserving its own works, while also noting that today's development is hardly a surprise.

"Museums and archives have been preparing for this future for a while, with the expectation that putting discs on a shelf isn't going to be a long-term solution for preserving new games.

As the director of a historical video game preservation institution, and someone who has dedicated his entire adult life to this cause, this is accurate. We have attempted to work with the industry's trade organization to find a legal path forward, but they refuse to offer a meaningful alternative.

— @frankcifaldi.bsky.social (@frankcifaldi.bsky.social.bsky.social) 2026-07-01T22:40:26.096Z

"What continues to baffle us is what the industry expects institutions like ours to do about it. If platform owners are deciding to eliminate physical media and older digital storefronts, then we'd also like to see trade groups like the Entertainment Software Association offer meaningful solutions for archives and museums to legally preserve digital-only content and make it accessible for research. Everyone agrees this is a serious problem, but the ESA has repeatedly opposed the efforts of cultural heritage institutions to reform digital copy protection laws to make it easier to do this work."

Some hay has been made about the inevitability of Sony's decision, and how PC gamers readily adapted to the temporary, conditional ownership of digital libraries, but it's worth noting that the death of physical PC games was a painful transition blunted only by preservation efforts both official and grassroots.

Statement from VGHF director Frank Cifaldi on the discontinuation of physical PlayStation media, and the closure of the PS3 and PSP digital storefronts.

— @gamehistoryorg.bsky.social (@gamehistoryorg.bsky.social.bsky.social) 2026-07-01T22:40:26.113Z

The PC is a perennially backwards compatible platform—flexible and open enough that game preservation is a matter of will, not way. Classics persist both legally and dubiously, and function on the same machine you play new releases on. There is no PlayStation GOG, nor a formal plan from Sony to address its scheduled abandonware (the closure of the PS3 and PS Vita digital stores were part of today's unpopular announcements).

So the task will fall, as usual, to unofficial efforts.

Six years ago, PC Gamer's Evan Lahti wrote a headline that captured the feeling of the moment, when PlayStation announced it would be bringing more of its exclusive games to Steam: Well, I guess we won the console war.

The walls between platforms had crumbled. Everything but Nintendo was or would soon be playable on PC. Steam, not Xbox Live or PSN, was the kingmaker for new indie games, and the best place for devs to keep steadily selling their back catalog.

Things feel a lot different half a decade later, as AI wreaks havoc with hardware prices, Xbox panics about all the money it's spent on acquisitions, and Sony retreats from the PC—and physical media—back to its exclusive digital garden. And yet it still seems like the PC won the console war.

Because what are Xbox and PlayStation at this point other than PCs, but worse?

Sony's dual announcements—that it will cease producing physical discs in 2028 and also shut down the older PlayStation 3 and Vita online stores next year—seem to have been published simultaneously with a ripping-the-band-aid-off PR mentality. People are going to be mad, so get all the bad news out at once and hope you didn't remove too much flesh with the band-aid in the process. The takeaway of those two announcements landing simultaneously, though, is highlighting that you can only buy games on the PlayStation how and where Sony says you can. The executives have already literally said they want to wring more money out of every PlayStation owner; clearly cutting the Walmarts and GameStops of the world out of the equation is one way for them to do that.

Obviously the games industry has been trending towards digital-only releases for years; to the spreadsheet-brained it was just a matter of time until the cost of manufacturing and shipping of physical discs no longer made sense. The PC even led the charge on that front, meaning consoles clinging to the option of buying physical releases was one of their last true differentiators. Microsoft gave up on Xbox exclusivity, bringing all of its games to its own Windows Store and then to Steam. But those were just digital releases. If you really wanted to own a disc with Halo Infinite printed on it, you still needed an Xbox.

In 2020, Sony killed Microsoft's entry level Xbox Series S, an underpowered $300 machine, by selling its discless but otherwise fully capable PS5 at just $400. In the midst of the crypto mining craze making graphics cards unobtainable, the PS5 was a great console for the price. Today it costs $250 more, and Sony has also started raising prices for its PlayStation Plus subscription service needed to play games online.

Even with the painful prices of storage and memory hitting PC gaming hard, the consoles seem to be pricing themselves into irrelevancy. In the six years since the PS5 launched, Sony has produced so few of its once-system-selling blockbuster exclusives that it's hard to imagine spending close to $1,000 to play one new Naughty Dog game, one new Insomniac game, and a new God of War. The prestige just isn't prestiging as hard as it was on the PS4. Add to that the uncomfortable reminder that Sony can revoke the licenses to stuff you've bought on its platform, and that it will inevitably stop selling old games whenever it becomes too much work to bother maintaining an aging digital store, all while you pay it $80 a year just to play games on the internet, and you've gotta ask what the point of that device really is.

I guess it makes a nice sound when you turn it on.

Okay, less sarcastically—the system is designed to work nicely on a TV. The user interface is relatively easy to navigate. It's got apps. Those old chestnuts have been used to defend consoles against the scawwy computer for as long as I can remember. It was true in, like, 2004. But console interfaces get more annoying and ad-infested every year, while their games now offer multiple performance options to pick from in a shallow approximation of the PC experience. Valve's SteamOS, meanwhile, has made tremendous strides towards a controller-friendly interface without sacrificing the flexibility that has always been the PC's core identity.

Install SteamOS on a giant tower PC or a tiny box built from the guts of a PS5! Use whatever controller you want! Buy your games on Steam (the prices are always better) or get them DRM-free on GOG, or grab them from a legally questionable "abandonware" website if they're no longer on sale. Still have a soft spot for physical discs (or disks) and want to do everything on the up-and-up? A USB drive will cost you all of 20 bucks, and decades of PC games remain available on Ebay. There are probably even cool mods or fan projects that make them play nice with modern hardware.

The PC may have led the charge on digital games years ago, but the thing is: anyone can still make, sell, or play physical PC games if they want to. The only person who can take away your PC disc drive is you.

To sum it all up:

• The last PlayStation and Xbox that were meaningfully different from PCs under the hood came out in 2005 and 2006.
• Price was once their biggest asset—AI has killed that.
• Simplicity was their second biggest, but while they've been making that experience worse for years, Valve (and the open source developers behind great initiatives like Bazzite) have been making the PC's better.
• Genuinely compelling exclusives other than Nintendo's are anomalies, and it's hard to be heartbroken over missing one or two given the number of interesting games hitting Steam every single week.

Sony now sells an overpriced entry ticket to a walled garden that kinda looks worse than the forest just outside it, while Xbox is actively lighting its own grounds on fire. Simpler and cheaper used to be worth the price of admission for a lot of people. But the way things are going, by the time the PS6 arrives anyone who buys it will just be paying more for worse.

Culminating a messy, year-long legal spat, Krafton has agreed to pay bonuses to the studio staff of Subnautica 2 developer Unknown Worlds Entertainment, having reached a settlement with the studio's leadership—including ousted-and-subsequently reinstated-by-court-order CEO, Ted Gill.

In an interview with Bloomberg, Gill said he has voluntarily resigned as studio executive, having "mutually agreed to part ways" following the settlement agreement.

Additionally, Gill said Unknown Worlds staff will be "compensated significantly more" than originally specified in the studio's initial bonus terms, and that all Unknown Worlds employees—not just those who were employed at the time of the Krafton's acquisition of the studio—would receive bonus payouts in three annual installments.

Krafton purchased Unknown Worlds in 2021 for $500 million, agreeing to pay the studio a further $250 million if it achieved certain financial goals—particularly, delivering successful Subnautica 2 sales performance. In 2025, as Subnautica 2's original release window neared, Krafton fired Gill and Unknown Worlds co-founders Charlie Cleveland before delaying Subnautica 2's early access launch into 2026.

The three ousted studio executives responded with a lawsuit, alleging the firings and delay were a ploy intended to allow Krafton to dodge having to fulfill the agreed bonus payouts. Ultimately, a Delaware judge ordered Krafton to reinstate Gill and extend the bonus earnout period to accommodate Subnautica 2's delayed launch—but not before it was revealed that Krafton CEO Changhan Kim had sought ChatGPT's advice when formulating plans for stiffing the studio.

That's what experts in corporate law call "a bad move." Particularly when it could cost your company the equivalent of one-third of its 2025 annual profit.

"We're all super excited about Subnautica 2 and its tremendous success," Gill said, presumably moments before doing one of those heel click jumps on his way out the door.

Former Unreal Engine director and longtime Epic engineer Nicholas Penwarden is stepping away from the company after 15 years.

"I'm proud of the part I was able to play in Unreal Engine's evolution from UE3 to where it stands today," the Epic veteran wrote in a post yesterday on LinkedIn "It's remarkable to see how far the engine has come, how much the community has grown, and all the incredible games and experiences developers have created with it."

Penwarden has been one of the faces of Unreal Engine for a while, popping up every now and then to give talks and take questions on the technical particulars of its tools and tout just how many complicated triangles devs will be able to insert into, well, whatever they like. In his time at Tim Sweeney's house, he's been an engine and graphics programmer on UE4, director of engineering on UE as a whole, VP of engineering, and engineering fellow.

He is not the only Unreal Engine bigwig to hang up his spurs in recent months. UE lost its former "chief evangelist", Sjoerd De Jong, when he left the company a few weeks ago after a 12-year stint.

"The games industry has always been an industry where change is relentless and inevitable, but it feels like we are reaching a pivotal point now and a potent mix of things," De Jong wrote.

Penwarden did not write anything quite so ominous. "Most of all, I'm proud of the team we built: the most talented, passionate, and extraordinary group of engine and game developers I could have hoped to work alongside. I wish Epic and the team all the best, and I look forward to seeing what they build next!" he concluded.

Nevertheless, it's another high-level departure from an Unreal Engine old-hand, just as Epic gears up for its 2027 release of Unreal Engine 6. Rather than focusing on new graphical achievements, Epic is positioning UE6 as a unifying force for game developers that will enable "content, code, and economies to become portable and interoperable across games."

Microsoft has been extremely busy lately, taking a well-earned break from polluting the world with AI to eviscerate the videogame industry. The reports of potential layoffs and closures—coupled with the short-sighted strategies of other publishers, including main rival Sony—are devastating. And the bad news just keeps coming.

According to The Verge, Arkane's Blade is now on the chopping block as well. This wasn't entirely unexpected, granted. While Arkane's games tend to be critically acclaimed, immersive sims continue to be a hard sell. Dishonored 2 and Prey didn't meet Bethesda's sales expectations, and Redfall was just a complete mess.

Now, a vampire-hunting dhampir stalking the streets of Paris sounds like a pretty good setup for an Arkane romp, but while Blade is highly anticipated, we've heard so little about it since the reveal that there have been concerns that development isn't going smoothly.

Todd Howard recently attempted to put these concerns to rest only last week, saying Arkane was "doing a really, really good job" on Blade. This vote of confidence, coupled with Arkane art director Jean-Luc Monnet saying the game wasn't being cancelled and that fans need to let Arkane cook, seemed like good news.

But Todd Howard ain't in charge now—he might have confidence in Arkane, but that doesn't mean Microsoft and Xbox's leadership feel the same way.

The Verge reports that Arkane is one of at least five studios being considered for closure as part of a cost-cutting strategy. Blade was meant to arrive this year, the report says, but the unannounced release date has since moved to late 2027. Coupled with it running over budget, this has given Xbox the fear.

Arkane's death would be tragic—the immersive sim genre is not a large one, and Arkane's one of the few major studios still making this type of game. Arkane's also been around for a whopping 26 years. It's got an important legacy.

However! There might be light at the end of the tunnel. Microsoft is apparently considering selling Arkane off, a move that would salvage the studio—and hopefully the talent. Though the latter is far from guaranteed. Still, Arkane escaping Xbox might actually be a good thing. Bethesda really didn't get Arkane, and Xbox hasn't shown much more understanding. This is a studio that likes to take risks, working for a publisher that's terrified of them.

Certainly, things aren't going to improve at Xbox. AI-loving CEO Asha Sharma's big Xbox reset will gut Microsoft's gaming division, with at least 1,000 jobs rumoured to be at risk, and that's not including the layoffs due the reportedly impending studio closures.

Basically: Xbox is digging its grave, but there's still hope for Arkane.

The Entertainment Software Association, in an ongoing attempt to slow the roll of the games conservation movement Stop Killing Games, made a baffling statement at a recent California State Senate hearing over a proposed Protect Our Games Act that goes as follows:

"[Private servers are] illegal. They are not in any way affiliated with Microsoft. Microsoft, for Minecraft, has gotten a lot of criticism because of those community servers not employing the same safety standards that Microsoft does on their Minecraft servers."

Now, you can read our very own Joshua Wolens' article on the foible yourself, but I'll repeat what he said back then in that the words of ESA vice president Jennifer Gibbons are basically nonsense. More on that in a moment.

In a statement provided to PC Gamer, the ESA wrote: "Private servers infringe on the intellectual property (IP) rights of game publishers. Publishers reserve the right to exercise their rights against them. The provision in CA AB 1921 that proposed these servers as a legitimate alternative to keep games running raises concerns about a publisher's ability to enforce their IP rights.

"In addition, private servers operate with no oversight from the publisher and do not uphold the same trust and safety standards. This could create an unsafe environment for players and be counter to the industry's commitment to fostering safe and fun game play for all players."

The ESA has since sent us another statement for what it calls "additional clarity", I'm not all that convinced we aren't looking at a backpedal, here. You can read the full updated statement in the screenshot below, but for the sake of in-article brevity, here are the key differences:

• Narrowing the scope of what private servers cause trouble, specifically, ones that "host or distribute copyrighted game content."
• A "without authorization" was snuck in there, too.
• "While publishers may take different approaches," was added to the statement that publishers "reserve the right to exercise their rights against them".

Basically, it's a softening of the deeply condemning statements the ESA made both during that hearing and in their original statement to our publication. And hey, it makes sense that some things are being walked back: Plenty of games have officially-permitted private servers or private server functionality without incident.

There are, of course, exceptions—like MMOs. There are World of Warcraft private servers that give access to the game without a subscription while also making money via in-game cash shops, which is legally indefensible, no matter how interesting their own spins on the games are.

But there are also exceptions to those exceptions, too. A City of Heroes' private server, Homecoming, was given official permission by its IP owners to keep operating on account of its good, non-profit focused behaviour.

And no matter which way you slice it, Minecraft isn't coming under fire for its community servers in any statistically significant way. As Josh pointed out, there's a literal part of the official website that lets you download a server, and in doing so, agree to the EULA.

While it's true in theory that Microsoft doesn't have a say in what people do on their own private servers… I mean, good? I'm stating the obvious here, but I don't think we should live in a world where the only online interactions we can have are the ones pre-approved by companies nobody voted for. That's how you get nonsense like credit card companies muscling in on itch.io.

It's a world I get the sneaking suspicion the ESA would like very much, however. This is the same lobby group that stopped libraries and museums from obtaining a DMCA allowance to provide remote access to games.

And while the ESA is technically correct in that private servers aren't 100% safe, neither is crossing the street, or taking a shower, or going outside. I'd be skeptical about its assertions that it's just trying to make the internet safe and cushy for everybody. We've seen how the UK's attempts to do so have gone awry.

Microsoft's likely got another wave of layoffs and studio closures coming, it's my displeasure to say—with multiple studios on the chopping block. It's another pip in a pattern of scattershot project cancellations and studio closures, in the same vein as the company shutting down Project Blackbird despite Phil Spencer loving it, or closing Tango Gameworks despite Hi-Fi Rush being touted as a success.

Basically, for Microsoft (and the wider industry at large) there's no real guarantee that good work will keep you in a job. And union members at the Communications Workers of America (CWA) spoke out in a press call (shared here by GamesBeat).

Morgan Goin, a senior encounter designer at ZeniMax Online—who has been through the wringer already, being caught in the shock closure of Arkane Austin and losing out on a month's employment before finding her feet—says that "there's a clear gap between what we need, how Microsoft talks about us publicly, and how we're being treated across all of their studios."

As a union rep, Goin feels like Microsoft's only talking the talk: "I have been entrusted with the responsibility to advocate for my coworkers. I cannot do my job when Microsoft refuses to do theirs. This isn't just affecting one studio or one department, it's affecting all of us. We refuse to be left in the dark as the company decides to restructure in a way that seriously affects us all.

"We're being treated as expendable, valued one week and cut the next. Why would a game developer bother to put forward their best work under these conditions? Hard work and great games do not save you from layoffs under Microsoft."

Allison Veneto, a senior editor for franchise development at Blizzard, a studio which also endured a game cancellation and a rash of layoffs after being acquired by Microsoft, comments: "Every time these layoffs happen, we lose incredible talent in years of institutional knowledge … We want layoffs to be treated not as a quick fix to a quarterly balance sheet, but only as an absolute last resort."

Senior environment artist at Blizzard Mahreen Fatima points out how little having a full-time job means under Microsoft's layoff-happy business culture: "In this climate of layoffs, it feels like there's really no difference between being contract and being full-time, we're all just as equally dispensable in the eyes of the company.

"Leadership points to revenue margins to justify fighting us. And then this week they raised console prices on players for the third time since 2025. They are not short on money. Look at the billions that they're using to invest in AI. They're just choosing not to protect us."

It's a feeling I generally agree with even as an outsider, and one I won't stop being exhausted by. The videogame industry has been experiencing massive growth, and CEOs like Microsoft's own Satya Nadella take home hundreds of millions of dollars. In fact, Nadella's pay jumped 22% between 2024 and 2025.

Last year, Microsoft made $27.2 billion in three months. It also planned to invest $80 billion in AI infrastructure. For the record, $80 billion is enough to keep a studio of 200 median-salary game designers ($113,000 annually) paid for 3,539 years, for a piece of technology that Nadella has openly said we need to do something useful with. You cannot convince me there isn't the money to keep these studios afloat.

Earlier this month, former SIE Worldwide Studios chairman Shawn Layden said the still-ongoing flailing at Xbox "evince a basic misunderstanding of how the interactive entertainment world moves." Harsh words indeed—but lest you think he's just a partisan hater, he's now taken aim at his former company, Sony, and its pullback from the PC market.

It's been quite a turnaround from Sony. After years of dogged exclusivity, Sony began releasing its games on PC to significant success—to the point that Shuhei Yoshida, also a former SIE Worldwide Studios boss, said it was "almost like printing money."

But earlier this year, Sony began backing away from the strategy, and while no formal announcement was ever made, it soon became clear that a PC pullback is happening.

Layden, who also previously served as president and CEO of Sony Interactive Entertainment America and executive vice president and COO of Sony Network Entertainment International, addressed the shift in a new interview with PSI, beginning by noting that in his mind, at least, bringing Sony games to PC was never about making money—it was about getting Sony properties in front of people who otherwise wouldn't see it.

"Not necessarily because they're going to buy a PlayStation," Layden said. "I wasn't that crazy. I didn't think that was going to happen.

"But as we take our intellectual property across other media, whether it's into films or whether it's in television or in comic books or into merchandise, whatever, you need to have as many eyeballs that are aware of this character, of this story, and just concentrating on the PlayStation population and only telling them these stories, and then try to bring it off of that platform into different media, that's going to be a hell of a jump."

While some have suggested that releasing PlayStation games on PC could "devalue" the brand, Layden says the strategy of holding them back for a year or so effectively addresses that concern: "I think if someone's waiting 18 months for something to come on PC, we didn't lose a sale to them. They weren't going to buy the hardware anyway."

"If it's a way to cover costs or the burden of making a port, there is some money attached to that, or the distraction or whatever," Layden said. "I don't know what they're thinking."

I don't either, but I do think it's interesting that we seem to be moving inexorably into a new round of the console wars: Microsoft has indicated that it's also looking at leaning more heavily on console exclusives in order to resuscitate the flagging Xbox brand. In that case, though, the impact on PC gamers should be minimal: Microsoft chief content officer Matt Booty said earlier this month that Xbox exclusives will "still show up on all the normal places where we sell the PC version."

The material impact of the PlayStation PC pullback is also debatable: PC Gamer's Morgan Park recently reminded that in the short term, at least, we're not likely to miss out on very much.

Here's another fact not to be overlooked: Unlike the ignominious dark days of "PC gaming is dying," PC gaming has never been stronger than it is right now. While year-over-year console revenue growth was close to stagnant, according to a Global Games Market Report published earlier in June, PC revenues leapt by 12%, powering the market past $200 billion in a single year for the first time. Take-Two CEO Strauss Zelnick says PC gamers have to wait for Grand Theft Auto 6 because we're not part of its "core" audience, but he also admits that PC can account for 45-50% of a big game's total sales. I have no idea how to square that either, but I definitely agree with Layden: Bringing Sony games to PC made sense, and taking them away just does not.

Just over a month after the successful launch of 007 First Light, the fastest selling game in its history, IO Interactive has run into some unexpected bad news about another project it's had in development for years. An "external partner" pulled funding from Project Fantasy, an "online fantasy RPG" that IO announced in 2023, and it sounds like layoffs at the studio are imminent as a result.

"For a good while, it has been all positive news from IO Interactive," the studio wrote on X. "However, today we have to share some more downbeat news. A relationship with an external partner on our own IP, Project Fantasy, has come to an end. This means we have to adapt to this new reality and its short-term consequences, including staffing decisions, which is what is happening as we write this update, and we are fully committed to supporting those affected through this challenging transition."

The comment about "staffing decisions" leaps out—it's not a confirmation of layoffs, but it certainly hints at them. IOI did not name the "external partner" in question, but it was widely assumed to be Microsoft, and the company confirmed that it was indeed the partner in question in a statement to Bloomberg, saying it is "taking a fresh look at where we invest so we’re focusing on our highest priorities."

Microsoft's Xbox division is eyeballing major layoffs and possible multiple studio closures as part of its reset, which is expected to begin in early July, and that could also mean ending more publishing partnerships with external studios like IOI. We saw that happen in the wake of major layoffs in 2025: While Microsoft was not named in either case, reports at the time indicated that it had ended funding for projects at both Romero Games and Avalanche Studios, throwing both into turmoil.

Romero Games co-founder John Romero commented on IO Interactive's situation, writing, "As a company, we've been there, and it's extremely difficult."

It's also notable that in 2021, IO Interactive was reportedly working with Microsoft on a fantasy game codenamed Project Dragon. It's not known whether Project Dragon eventually evolved into Project Fantasy, but IO Interactive CEO Hakan Abrak teased at the time that "we have a third universe that we're working actively on, which is a bit different and absolutely a love child," adding, "It is something our core people, our veteran staff, have been dreaming about for some time."

Despite the sudden change, IO Interactive said it remains "100% committed" to Project Fantasy, and promised that "this wonderful world will see the light of day." Given the current state of the videogame industry, which will only get worse if and when the expected axe falls on Xbox, I wouldn't count on that happening anytime soon.

IO Interactive declined to comment.

Godot has been suffering from a slop problem. In February, the maintainers of the open source game engine, which powers games like Slay the Spire 2 and The Case of the Golden Idol, said they were deliberating how to address a rising tide of AI slop pull requests, which had become "increasingly draining and demoralizing" for the project's code reviewers.

Today, after months of discussion, the Godot Foundation and its maintainers are drawing a line in the sand. In a blog post, the Foundation announced that Godot's guidelines for contributors will soon be amended to forbid AI-authored code, pull requests submitted by AI agents, and AI-generated text in human-to-human communication.

"It is time for us to recognize that these problems aren’t going away and therefore we need to take steps to reduce the burden on maintainers while ensuring we still have a pipeline to mentor new contributors to become future maintainers," the Godot Foundation said.

The Foundation says the pileup of Godot pull requests pending review isn't all bad: It's a sign that interest in using and contribution to Godot is increasing. But the influx of contributions authored or submitted by AI is sapping the projects' maintainers of their willingness to confront the "already tedious" work of reviewing pull requests.

"If your feedback on PRs is just being absorbed by a machine and not going towards mentoring a potential future maintainer, it becomes much harder to justify spending your free time on PR review," the Foundation said.

As the problem becomes increasingly unsustainable, the Godot Foundation says it's in the process of updating its contribution policies, focusing on "adding barriers to low-effort slop" contributions, encouraging maintainers to review code, developing new contributors into future maintainers, and crucially, requiring that all contributions come from humans who are accountable for their code—and fixing it if it fails.

"AI cannot take responsibility, and we can't trust heavy users of AI to understand their code enough to fix it," the Foundation said.

The Foundation says we can expect Godot's contributing policy to soon include explicit rejections of AI-authored code, noting that contributors should only use AI assistance for "menial things" and must disclose its use. Additionally, the Foundation will reject any AI-generated text in human-to-human communications, saying it's "a basic principle of respect"—though it says machine translations "are still acceptable" if the original text was human-authored.

"Things change every day with respect to the current suite of AI tools available," the Foundation said. "We will continue taking a conservative approach in our policies towards them, but we will re-evaluate as things evolve."

In a remarkably strange statement at a recent California State Senate hearing over the Protect Our Games Act (AB 1921, California's Stop Killing Games-endorsed bill to compel publishers to provide ways to keep playing discontinued games), a representative of the Entertainment Software Association declared private servers for the likes of Minecraft and Call of Duty "illegal," adding that, so far as the ESA is concerned, "we consider it piracy."

The representative in question was Jennifer Gibbons, the ESA's vice president for state government affairs, and just to clear this up right away: what she said was nonsense. You can, literally right now, head over to the official Minecraft website and download a .jar file to let you run your own private server.

Gibbons was responding to a comment made by California state assemblymember Chris Ward—who introduced the bill—regarding the possibility of keeping games alive with private servers. "Minecraft is currently hosted by community servers, Call of Duty [has] community servers, so it's an option that is out there, in existence here today."

Gibbons cut in: "They're illegal. They are not in any way affiliated with Microsoft. Microsoft, for Minecraft, has gotten a lot of criticism because of those community servers not employing the same safety standards that Microsoft does on their Minecraft servers."

Asked by California state senator Caroline Menjivar as to whether this was "like the black market of videogames?" Gibbons responded "Yes. In fact, we consider it piracy. We have lawsuits, two pending lawsuits, against private servers right now, and the United States Trade Representative (USTR) in their Notorious Markets Reports on counterfeiting and piracy has named some of these big private servers as a notorious market." A notorious market refers to a market where intellectual property infringement is rife—think something like The Pirate Bay.

It is true that the USTR has named particular private servers in its Notorious Markets Reports in years gone by, but not for the simple fact of existing as private servers. To take an example, the 2018 report specifically cited Warmane and Firestorm Servers as examples of notorious markets—two sites which enabled people to play World of Warcraft without paying a subscription to Blizzard. Which is quite a bit different from the private Minecraft server you run with your pals, or a community server for an old COD that no one maintains anymore.

Regardless, the Protect Our Games Act did not make it out of this stage of the legislative process. With four aye votes, three noes, and four abstentions, it failed to accrue the majority of ayes necessary to pass. Nevertheless, it has been granted a reconsideration, so it's not the end.

In a statement to PC Gamer, the ESA wrote that, so far as it's concerned, "Private servers infringe on the intellectual property (IP) rights of game publishers. Publishers reserve the right to exercise their rights against them."

As regards the Protect Our Games act, the ESA went on to say that "The provision in CA AB 1921 that proposed these servers as a legitimate alternative to keep games running raises concerns about a publisher's ability to enforce their IP rights. In addition, private servers operate with no oversight from the publisher and do not uphold the same trust and safety standards. This could create an unsafe environment for players and be counter to the industry's commitment to fostering safe and fun game play for all players."

A Stop Killing Games campaign volunteer has already commented on the hearing's proceedings. In a post on Reddit, they wrote that the ESA's claims, both regarding the supposed illegality of private servers and others, were "designed to scare a busy legislator who does not have time to fact-check a well-dressed lobbyist in real time.

"It worked just well enough this round. It will not work when we are standing in the same room, with developers and players beside us, ready to answer every single claim as it happens. Next session, we come back with an in-person lobbying presence, the funding to do this properly, and a long list of organizations and developers signed on in support.

"We are not limiting this to California. We intend to introduce versions of this in other state legislatures, and we are seriously looking at the federal level. The ESA is about to learn what it is like to fight on many fronts at once."

First shared on Bluesky by Circana analyst Mat Piscatella, Sony has provided a glimpse of PlayStation's future and priorities through a written summary of its Game & Network Services Segment Small Meeting Q&A. Answers were provided by Sony Interactive Entertainment CEO Hideaki Nishino, Studio business CEO Hermen Hulst, and SIE senior vice president of finance and corporate development, Lynn Azar.

The meeting took place on Friday, June 5, a month after Sony revealed it was pulling back from releasing its major singleplayer games on PC, and weeks before the Bungie bloodbath precipitated by the sunsetting of Destiny 2. Speaking as a normal guy who likes games and mostly uses his PS4 to watch Hulu, the "vision" provided during the meeting did not inspire confidence.

In fact, this unvarnished glimpse at the decision making priorities at the heights of the game industry made me actively depressed.

'Focusing more on monetizing our user base'

Responding to a question on how PlayStation will achieve Monthly Active User (MAU) growth in 2027, the group indicated that it's more focused on maximizing profit per customer, assessed through a metric with the unsettling name of Customer Lifetime Value.

As for how that happens, PlayStation's execs explained in a follow-up question: "There are multiple ways to achieve that via recurring revenue such as add-on content revenue," and rather than upping the MAU count, the group is "focusing more on monetizing our user base, which is well reflected in the strong FY2025 financial results." I love being monetized. Were I a PlayStation customer, I'd be thrilled that's such a major priority.

Elsewhere in the Q&A, they reference "record-high PS Plus profitability in FY2025." Between normal use and the streaming PlayStation Portal, the paid premium online service seems to be a key moneymaker for PlayStation. In response to a question about recouping the infrastructure costs of streaming games, the group responded that "We expect to recover the costs associated with investments and operations through revenue generated from PS Plus, which provides the streaming service."

'AI is an exciting long-term opportunity'

"For the next-generation platform, rather than simply serving as an alternative to PCs, we aim to deliver value that is unique to PlayStation.""...we are focusing more on monetizing our user base""We expect to recover the costs... through revenue generated from PS Plus"morganfreeman.gif

— @matpiscatella.bsky.social (@matpiscatella.bsky.social.bsky.social) 2026-06-30T00:22:56.575Z

"We also see AI as an important foundational technology supporting our strategy," said CEO Nishino as part of a message before the Q&A. "AI is already helping us across various fields by improving development efficiency, enhancing the player experience, improving content discovery, and enabling creators to build richer content."

"With our global player base, deep library of IP, and integrated ecosystem, AI is an exciting long-term opportunity for us."

Further into the Q&A, the lone specific example of AI use in development was the classic placeholder assets, something that has gotten studios like Sandfall Interactive and Pearl Abyss in trouble when they make it into a final product.

"This is less about cost efficiency and more about improving quality and development speed, which we see as highly valuable," the execs said. "At the same time, we are experimenting at a more fundamental level with smaller, AI-first initiatives, while remaining realistic about near-term efficiency gains. These efforts position us to stay at the forefront as AI continues to evolve, both in development process and in shaping future player experiences."

'Deliver value that is unique to PlayStation'

As a primarily PC gamer, I found PlayStation leadership's understanding of why players prefer the platform to be illuminating. In response to a question about winning back PC players who switched from PlayStation, the group described it as a matter of form factor.

"PlayStation has long been strongly associated with the idea of playing in the living room. However, in recent years, more users globally have been using personal monitors," said the group. "In response, we are selling peripherals such as monitors and speakers to break away from the fixed perception that 'PlayStation equals the living room' and to broaden usage scenarios.

"For the next-generation platform, rather than simply serving as an alternative to PCs, we aim to deliver value that is unique to PlayStation. This includes not only technological advancements but also an expansion of usage styles, enabling a seamless experience that can be enjoyed naturally beyond the living room."

Much as I love my desk and my high refresh monitor, they're not the main reasons I prefer PC to console: I'm here because of the PC's nature as an open platform, with access to more of gaming history and the frontiers of independent development than any single console or console service like Game Pass or PlayStation Plus.

In 2026, would you rather own a Steam or GOG library that was started in 2014, or a collection of PS4 games from around the same time? How valuable or relevant will a PS5 library look compared to a PC one 12 years from now?

The PC is the only platform where more than 50% of revenue comes from games outside the top 20 best sellers. Sony seems to view its first party lineup as a crown jewel that PC players should be desperate to access, but the reality is that it's just a small subset of a much deeper, more interesting catalogue. There's only one Sony exclusive I've personally held a candle for in the past 20 years, and not even loyal PlayStation customers are getting their Bloodborne fix.

Handheld and small form factor builds can extend the PC's potential past the desk, but PlayStation will always be a closed loop no matter the form factor, one that requires users to maintain a premium online subscription to fully utilize the electronics they already purchased, all on top of the internet access they pay for.

This disconnect may help explain why SIE pulled back from PC despite its ports raking in major profits: The company's leadership thinks converting PC players into PlayStation owners is a matter of form factor and quality exclusives. It isn't, and with yet more AI-induced hardware price increases on the horizon, I think that reality will hit SIE's bottom line sooner rather than later.

Less than two months after the release of its latest game, Directive 8020, Supermassive Games CEO Robert Henrysson has announced that he is stepping down from the position as well as his role at parent company Nordisk Games.

"As the CEO of Supermassive Games, I was honoured to guide the studio through intense industry change, broadening its client base and establishing a culture of consistent quality across all aspects of the game development process," Henrysson wrote in a farewell message posted on LinkedIn (via Game Developer).

"Leading a studio is never a one-man job—it is the entire team's effort. Our commitment to continuous improvement was, and continues to be, central to everything we do. To everyone at Supermassive Games, I am so grateful for everything I’ve learnt and experienced with all of you. You are the greatest storytelling game studio on earth, you rock! And I wish you all the best in the future."

A separate message posted by Nordisk credits Henrysson for taking on "a broad operational role, supporting existing portfolio companies through a period of considerable change, including serving as the Chairman and Interim CEO of Avalanche Studios Group." He was appointed as CEO of Supermassive "with a clear mandate: to lead Supermassive Games through the successful delivery of Directive 8020. During his time, he rebuilt the studio's leadership team, sharpened its strategy and oversaw the completion and launch of Directive 8020, the latest instalment in the Dark Pictures series."

And in that role, he was seemingly successful: Directive 8020 holds a "mixed" user rating on Steam and a relatively small number of user reviews compared to other Dark Pictures games. But we liked it quite a bit, calling it "unmissable adventure for any fan of sci-fi horror" in our 85% review, and Nordisk praised Directive 8020 for earning "the strongest critical reception in the series to date," reflecting "the hard work and commitment of the entire Supermassive Games team, supported by Robert's leadership throughout this important period."

It also bears noting that Henrysson led Supermassive through two rounds of layoffs in the leadup to Directive 8020, in February 2024—shortly after he took over from departing founders Pete and Joe Samuels—and then again in July 2025. Supermassive was hardly alone in that, though: The games industry has been rocked by thousands of layoffs over the past few years, as the heady stuck-at-home days of the Covid-19 pandemic gave way to the harsh light of reality, which apparently just about no executive in the videogame business was able to foresee.

Henrysson said he's going to spend the summer with his family, but left the door open to new roles: "Fundamentally I love the games industry and the people in it, so I’ll be open to taking on selected advisory roles and exploring what comes next."

I confess, even after several years writing about videogames for money, I still have to pause sometimes and remember which CD Projekt is which. I use this handy mnemonic rhyme: If CD Projekt Red you see, that's the folks who made The Witcher 3. If CD Projekt alone you view, that's the parent company. Doo bee doo.

But I guess it's time for me to throw that rhyme out, because CD Projekt is rebranding itself as CD Projekt Red, bringing the whole enchilada under the same brand. "In the opinion of the Management Board, the new company name will ensure full brand consistency and facilitate the identification of the Company with its products on the global market," quoth the company in the relevant resolution.

Which does mean that, in the future, I will now have an even harder time distinguishing between actions undertaken by CD Projekt Red (née CD Projekt) and, uh, CD Projekt Red (the games people). See? It's already happening. How could Marcin Iwiński do this to me?

I grudgingly admit it makes sense, though. To many of us, CD Projekt is CD Projekt Red. I am a lot more concerned with Cyberpunk 2 and The Witcher 4—both operations that fall under the company's game-dev rubric—than I am with the wider company's broad corporate machinations. To the public, this company is a game-development studio with some other stuff attached, even if the nitty-gritty of its corporate structure is the reverse.

So, hey, makes sense. But I need a new rhyme. If broader corporate decisions they're making, that's the corporate arm that used to be CD Projekt, and no mistaking. If designing Geralt's new beard they be, that's the game-dev arm. Fiddle de dee.