Microsoft adds to lay off count with announcement of multiple Xbox studio closure

Four more video game studios under Microsoft’s Xbox are reportedly being shut down as part of the company’s cost-cutting and further focus on larger titles. The affected studios include Arkane Austin, Tango Gameworks, Alpha Dog Games, and Roundhouse Games.

In a mail to IGN, the head of Xbox Game Studios, Matt Booty wrote, “Today I'm sharing changes we are making to our Bethesda and ZeniMax teams. These changes are grounded in prioritising high-impact titles and further investing in Bethesda's portfolio of blockbuster games and beloved worlds, which you have nurtured over many decades.”

“To double down on these franchises and invest to build new ones requires us to look across the business to identify the opportunities that are best positioned for success. This reprioritization of titles and resources means a few teams will be realigned to others and that some of our colleagues will be leaving us.”

Studios shuttered despite creating some of the all-time hits

Arkane Austin is known for PREY, one of the most popular sci-fi psychological horror games. Their most recent game, Redfall saw heavy criticism due to a broken launch leaving it unplayable as a single-player live service game.

However, this doesn’t seem to be the reason the studio is being dissolved as Tango Gameworks which also has a history of making super hit games like Evil Within 1 & 2 alongside Ghostwire: Tokyo and Hi-Fi Rush is also being axed.

Developers across the board from other studios are also shocked by this news, with many wondering the reason behind the decision. Game Director for Alan Wake 2, Kyle Rowley, extended position from devs at Tango Gameworks.

We took a lot of inspiration from both Evil Within and Evil Within 2 when developing Alan Wake 2. They are both excellent horror games and I'm very sad we will not get to see a continuation of the franchise from @TangoGameworks . We have open positions at @remedygames so please…

— Kyle Rowley (@TimePirateNinja) May 7, 2024

CEO of Arrowhead Studios said, "I don't understand the closure of Tango Gameworks, I mean... Why close instead of divest? Surely the team would easily have been able to find a new home", which is quite true. While publishing director at Larian Studios also spoke on the matter, saying, “I cannot imagine hearing you’re being let go because of prioritisation of another developer.”