Update []: Windows Central journalist Jez Corden has corroborated Games Beat’s report about Undead Labs facing the axe from Xbox and looking for alternative funding.
He says “Xbox Games Studios’ teams are working seven day weeks to meet Microsoft’s cutbacks and save studios with potential sales to third-party suitors”.
Bloomberg’s Jason Schreier, writing on ResetEra, wouldn’t confirm or deny anything in regards to the State of Decay 3 dev, saying he wants to be “100% certain”.
He did add, however, that studios may not necessarily require a sale to survive. He said that “some of the studios that are lined up for closure will be spun out and taken independent again by their management, potentially saving some jobs”.
Original Story: As part of a wider report by Games Beat delving deeper into the union response to the impending Xbox layoffs, it sounds like a fourth studio is searching for external investment.
State of Decay 3 dev Undead Labs allegedly faces a fight for funding, despite confirming its sandbox survival game for the PS5 at the Xbox Showcase just weeks ago.
This follows Ninja Theory’s announcement of Senua, which was supposedly used by Microsoft to drum up interest in the studio as it looks to either offload it or shut it down.
Previous reporting from Bloomberg had mentioned Double Fine, Compulsion Games, and the aforementioned Ninja Theory were all searching for alternative funding – but there had been some whispers over the weekend that Undead Labs may also be in the mix.
“Bloomberg reported earlier that Microsoft is preparing to close multiple game studios if there are no buyers found. And we hear that Microsoft is preparing to take action in early July, just after the close of the financial quarter on June 30.
It’s possible some of the studio jobs will be saved if a buyer is found for any one of the four studios: Double Fine Productions (Kiln, Keeper), Undead Labs (State of Decay), Compulsion (South of Midnight), and Ninja Theory (Hellblade/Senua).”
I actually think Undead Labs could be best placed to find a publisher, because State of Decay 3 looks somewhat close to completion and clearly has a compelling premise that could prove popular in the current market.
What’s insane here is that the studio has been sharing exclusive pre-alpha gameplay footage with YouTubers which has been stirring up quite a lot of online enthusiasm. We even reported on it a few days ago through here.
Games Beat’s article continues that even studios unlikely to be sold or closed will face heavy layoffs, as Xbox wrestles with the weight of its bloated business. The company, for the record, is yet to comment on any of the reports.
But in a staggering statement earlier this month, Microsoft CEO Satya Nadella jibed that “there’s more monetisation of Xbox games happening on YouTube than at Microsoft”, while incoming Xbox boss Asha Sharma has warned that the division is in need of a reset.