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Microsoft's Xbox announces studio closures in cost-cutting move; KNOW everything about future of gaming industry
Xbox shuts down studios like Arkane Austin in a strategic move. Microsoft reallocates resources for innovation despite the gaming industry's slowdown.
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Microsoft's Xbox division closes studios to refocus resources on game portfolio
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Take-Two Interactive also announces studio shutdowns
Just recently, the Xbox division of Microsoft caused a stir in the gaming industry by announcing that it would shut down some game development studios, including the venerable Arkane Austin. The decision by Microsoft is strategic and indicates a wider wave of publishers reshuffling their structures in response to signs of sluggishness in-game sales.
Studio closures and a shift in focus
Some entities earmarked for closure include Tango Gameworks, creator of Hi-Fi Rush based in Tokyo and Alpha Dog based in Canada. Matt Booty, Head of Xbox Game Studios, let this information out through an internal memo obtained by Reuters. However, he did not disclose how many employees would be affected or provide more details about the scale of cuts.
Booty said that this decision aimed at streamlining operations and shutting down specific studios to help reallocate resources towards strengthening Xbox’s game portfolio as well as creating new intellectual property. In other words, it is clear that this company is committed to innovation and future growth plans within the gaming industry.
These closures come after Microsoft acquired ZeniMax Media alongside Bethesda last year for $7.5 billion but Activision Blizzard’s takeover significantly boosted its Q3 revenue by 62%.
Industry-wide impact
According to Bloomberg News, studio closures have also been put into effect by Take-Two Interactive which announced plans to close two smaller subsidiaries amid wider restructuring efforts. Earlier this year, there were massive retrenchments with 1900 staff laid off from Activision Blizzard and Xbox.
But then again some developers from Arkane Austin will move on to other studios under the Bethesda ecosystem contributing towards ongoing projects such as The Elder Scrolls and Fallout franchises This means that Redfall; an Arkane-developed video game will remain functional thus avoiding any interruptions while players continue participating.
Microsoft's decision to close several gaming studios, including Arkane Austin signals a major shift in the gaming industry landscape. However, this drastic action is in line with Microsoft’s broader strategy of resource optimization and focus on future growth opportunities in the gaming industry.
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