38 Studios Lays Off Entire Staff

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Not only are tax payers still on the hook for this (original story), it seems that all three hundred and seventy full-time employees have now been laid off too. :(

"The Company is experiencing an economic downturn. To avoid further losses and possibility of retrenchment, the Company has decided that a companywide lay off is absolutely necessary. These layoffs are non-voluntary and non-disciplinary.

This is your official notice of lay off, effective today, Thursday, May 24th, 2012."
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While sad, it's not entirely too surprising. Video games are a horrible market to actually try to make a profit on. Most games fail to break even, and only survive by relying upon previous glories. Then, throw in creative accounting, and you have a bigger problem.
 
That sucks for the employees, especially given that 38 studios made good with the last back owed payment by using their payroll. I'd guess that the employees likely are not getting a severance package.

I guess there will not be any future support for Kingdoms of Amalur.
 
Viper16 said:
Were there games any good to begin with?
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Game. The only game 38 Studios ever made was Kingdom of Amalur: The Reckoning or whatever. It needed to sell 3 million copies to make a profit, and the sold like, 1.2 million or something.
 
ballistic90 said:
Game. The only game 38 Studios ever made was Kingdom of Amalur: The Reckoning or whatever. It needed to sell 3 million copies to make a profit, and the sold like, 1.2 million or something.
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That game wasn't good enough to sell half that many copies.
 
I strongly believe the problem was not making three million sales, but instead about the time and the money it took to get the game out.
 
The people that made monetary decisions deserve this fate. No one else.

Disgusting.
 
I feel bad for the staff who have not been paid in the last week or so. Then there is the guy who's wife is pregnant. She found out she did not have health coverage at the hospital.

They did not even have the decency to tell their staff they lost their health insurance and oh those last two checks we owe you... forget about being paid.

While I still have family back in RI, thank god I moved 7 years ago
 
rudedog said:
I feel bad for the staff who have not been paid in the last week or so. Then there is the guy who's wife is pregnant. She found out she did not have health coverage at the hospital.

They did not even have the decency to tell their staff they lost their health insurance and oh those last two checks we owe you... forget about being paid.

While I still have family back in RI, thank god I moved 7 years ago
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You're only kidding yourself if you don't think this is how it is in the entire country by and large.

And I don't give a rats ass which politician says what or what meaningless letter is front of their names, either.
 
Q-BZ said:
The people that made monetary decisions deserve this fate. No one else.

Disgusting.
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This unfortunately is a tricky issue. Software development is a pretty expensive endeavor, and either most people would need to halve their salaries (at minimum), we could go back to the days of not having professional voice actors (see early FMV games), or games could just quadrouple in price. Any of the above happens, and gaming itself will become less prevalant than it is today. Heck, many indie games today have budgets which far exceed those of mainstream games 20 years ago, including inflation.

Yeah, it's annoying that the tax payers are going to be stuck with the bill, but this is actually one case where a company was providing and creating jobs for people when they went to get the loan.
 
See this is where I think a lot of game studios are failing. They develop only large games and ignore smaller games. Smaller Games can bring in cash flow to any game studio and you use that to fund your larger game titles.
Unless you are a company like Nintendo or Valve, you need to focus on bringing out smaller games first and work towards larger games as you go on.
 
as a Rhode Islander...and a small business owner...I am so f*ing pissed it's not even funny. This deal was snuck in and then pushed through when people started hearing about it. There was NO WAY this deal should have gone through...that money could have helped any number of small businesses that would have paid it back in full w/ interest. It's a friggin crime and the Caceiri (former governor) should be forced to pay it back out of his pocket because he pushed it through.

If 1000 small businesses has been given $100,000 each it would have benefited a MINIMUM of 1000 people and there was a MUCH higher chance it would have been paid back

DISGUSTED.
 
Dan_D said:
That game wasn't good enough to sell half that many copies.
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The game was "ok." It was a one trick pony that I simply lost interest in after a point. It became very repetitive. The characters looked like PlayStation 1 cast offs but the overall art direction was nice.
 
Q-BZ said:
You're only kidding yourself if you don't think this is how it is in the entire country by and large.

And I don't give a rats ass which politician says what or what meaningless letter is front of their names, either.
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Amen on that. All of these politicians are a waste.
 
politicians need to be shot for shit like this, its the only thing that will ever stop them
 
Dan_D said:
That game wasn't good enough to sell half that many copies.
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Word. Most boring damn thing I think I've ever played. Game should have had half the content they put in it, then they might have made a profit, and I may not have quit half way through.
 
Q-BZ said:
The game was "ok." It was a one trick pony that I simply lost interest in after a point. It became very repetitive. The characters looked like PlayStation 1 cast offs but the overall art direction was nice.
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I think "competant" sums up the entire game. It felt put together and had polish, but never really stood out. It's like they had a bunch of ideas they wanted to put in, but pulled back and polished what they had really well.

It was mediocre, but it was a POLISHED mediocre.
 
I should ask Indiana for a $5 million loan and then lay off my staff. Seems the quickest way to get rich.

I bet the CEO of 38 Studio made off like a bandit.
 
Bug Huge Games was going to be closed before 38 Studios bought them years ago.

They got to make 1 last game, luckily. However, what a mismanagement fiasco.
 
38 Studios whole business model hinged on milking RI for as much tax money as possible.
1. Loan Guarantee by the state.
2. Use loan to create product that qualifies for tax credits in RI.
3. Sell Tax Credits to other RI businesses to pay back loan from RI.
4. Rinse and repeat.

Only after the RI Gov said he would do everything in his power to block the company qualifying for tax credits did schilling pull the plug.
 
Azhar said:
I bet the CEO of 38 Studio made off like a bandit.
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The CEO was Kurt Shilling, former pitcher for the Red Sox (pitched when they won the world series I think, famous for the "bloody sock)...he was already a millionaire, and he got his 4 million dollar investment back before sacking everyone.

Criminal charges. I have written to every elected official in this state asking for that.
 
bearax said:
The CEO was Kurt Shilling, former pitcher for the Red Sox (pitched when they won the world series I think, famous for the "bloody sock)...he was already a millionaire, and he got his 4 million dollar investment back before sacking everyone.

Criminal charges. I have written to every elected official in this state asking for that.
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Then what I suspected stands. He made off like a bandit.
 
Where are you guys getting this information? The articles I have read mention that Curt has personally lost over 20 million in the venture.
 
trk2 said:
Where are you guys getting this information? The articles I have read mention that Curt has personally lost over 20 million in the venture.
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Perhaps the money he "lost" are the loans Bash mentioned. Just speculating.
 
trk2 said:
Where are you guys getting this information? The articles I have read mention that Curt has personally lost over 20 million in the venture.
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"There can be no question our country is in the worst economic crisis of our lifetimes. I also think there can be no question that it falls on us, the individuals, to find a way out of our own personal crisis." -- Curt Schilling, February 2011
 
Spire3660 said:
"There can be no question our country is in the worst economic crisis of our lifetimes. I also think there can be no question that it falls on us, the individuals, to find a way out of our own personal crisis." -- Curt Schilling, February 2011
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This guy sure was the embodiment of the entrepreneurial spirit. :rolleyes:
 
Everything I'm reading is starting he lost a grip of personal money trying to do this, there wa no mention of loaned money, where are you people seeing that he had a return in anything of this?
 
Q-BZ said:
Exactly. Lots of potential there but it just didn't get "bumped over the hump" for me.



http://articles.boston.com/2012-05-18/business/31749752_1_loan-guarantees-curt-schilling-studios
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When I read that article, it made me laugh at Schilling's stupidity. I hate it when entreprenuers like him say that they don't look for the government to take care of them, when that's exactly what they do. Ever wonder what happens when a company files for bankruptcy? The government bails them out, that's what.

I don't neccesarily think that states shouldn't be loaning money to companies to get them started, since that can sometimes help get the unemployment level down, but you can't just toss this kind of money around at a single venture. And even still, the company's financial plans weren't very smart. It looks like the best way to go now is to start small, making either Android/iOS games or independant games first, and then when you make money from those use it to fund a bigger project while still keeping on with the smaller games as your bread and butter.
 
Trimlock said:
Everything I'm reading is starting he lost a grip of personal money trying to do this, there wa no mention of loaned money, where are you people seeing that he had a return in anything of this?
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He borrowed 75 million, backed by the state of Rhode Island. If he defaults, RI taxpayers are left holding the bag. $112 million when you include interest.
 
Dan_D said:
That game wasn't good enough to sell half that many copies.
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Agreed. I felt it was bland , had an older design "feel" to it that while ambitious in its scope just didn't work in practice. Flawed game with great potential but in the end in my opinion a mediocre RPG that just couldn't quite catch on.
 
Spire3660 said:
"There can be no question our country is in the worst economic crisis of our lifetimes. I also think there can be no question that it falls on us, the individuals, to find a way out of our own personal crisis." -- Curt Schilling, February 2011
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I remember watching an interview with him on 60 minutes and when he mentioned something similar to this I just groaned.

Grow the fuck up and please stop giving out bad investment advice. I'm sick of listening to entrepreneurial's drone on about what they feel responsible for and how anyone should invest their money.

Life is luck. There is maybe one person I would absolutely trust with investment advice and that is Warren Buffet , everyone else can shut the fuck up.
 
Spire3660 said:
He borrowed 75 million, backed by the state of Rhode Island. If he defaults, RI taxpayers are left holding the bag. $112 million when you include interest.
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He had a loan approved for 75 million but only borrowed 49 million. Furthermore Rhode Island promised the 75 million in return for Schilling moving the company to Rhode Island.

Look, I'm pissed off as well that the taxpayers have apparently lost 49 million but the facts are apparently Schilling himself has lost 30 million (source) trying to build this company. Portraying him, as others have done, as someone who stole taxpayer money seems irresponsible. The way I look at it, both RI and Schilling gambled on the company being successful and they both lost.
 
trk2 said:
He had a loan approved for 75 million but only borrowed 49 million. Furthermore Rhode Island promised the 75 million in return for Schilling moving the company to Rhode Island.

Look, I'm pissed off as well that the taxpayers have apparently lost 49 million but the facts are apparently Schilling himself has lost 30 million (source) trying to build this company. Portraying him, as others have done, as someone who stole taxpayer money seems irresponsible. The way I look at it, both RI and Schilling gambled on the company being successful and they both lost.
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This was generally the impression I had gotten. What ended up being the big problem however is that they basically had most of the funding towards their MMO they were creating, and that was a year or so away.
 
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