If This Game Studio Collapses, Taxpayers Will Owe $112.6M

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There seriously needs to be some ass kicking going on here...starting with the governor. :mad:

With Rhode Island politicians and 38 Studios silent on the precarious financial condition of the developer, the potential cost of the doomsday scenario to taxpayers has come to light. WPRI reports that if 38 Studios can't pay the bonds it received from the state, taxpayers will actually be responsible for paying back $112.6 million through 2020.
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At first I supported 38 Studios. After I saw how generic and uninspired their first game was, I finally realized they were nothing but another big budget studio looking to maximize profit. I thought that with the writing and art talent that they had, that their games would be something truly special. I was wrong.
 
tax payer bailout again. I think the US should keep no less than 25% of all the stock we keep from these companies that we bail out. Make an example out of them.
 
Eh, such is the case with all types of bond measures, however at least in the case of voter approved bonds (aka FREE MONEY YAY!!!!! *frown*) at least the voters need to OK the bonds. You would think that if the private company can't get funding from private investors that the government sure as fuck shouldn't go to those same investors and basically be the collateral.
 
For the lazy, this is Curt Shilling's studio and Kingdoms of Amalur.

The other article states that as of March 15, 38 Studios employed 701 people.

Losing 700 jobs would not be good, but neither is forcing the taxpayers to gamble on game development.
 
WTF is the government doing investing in Game Studio's ?
 
EchoMatrix said:
tax payer bailout again. I think the US should keep no less than 25% of all the stock we keep from these companies that we bail out. Make an example out of them.
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or here is a novel idea, let the company fail. its not the goverment's mandate to bailout a private company. can anyone not see that the government can barely run itself and if a company failed without the governments help, who in their right mind thinks it would with it.
 
haha their MMO better be one hell of a good game or they are up shit creek
 
I'm playing through KoA now, and it feels like it was meant to be an MMO, they just forgot to add the extra players. It plays just like a fantasy MMO, but with some twists to the combat and stat system.

That is quite an investment for a government to make into the games sector, especially as they are such a gamble. Unless you already have a proven formula you know people will gobble up, any game is a huge risk. Even great games can be overlooked and bring companies crashing down.
 
General rule, big studio falls apart, employees make another studio..well until the state got involved in keeping this one game wonder alive. Heck if this company gets a bail out don't be surprised to see EA pull the same stunt, they keep complaining about being borderline broke, and still pushing games for the full price.
 
J Macker said:
For the lazy, this is Curt Shilling's studio and Kingdoms of Amalur.

The other article states that as of March 15, 38 Studios employed 701 people.

Losing 700 jobs would not be good, but neither is forcing the taxpayers to gamble on game development.
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being from ma, i hate curt shilling!! this guy is the big ass and now he is hanging a state out to dry. such a loser!
 
pstang said:
or here is a novel idea, let the company fail. its not the goverment's mandate to bailout a private company. can anyone not see that the government can barely run itself and if a company failed without the governments help, who in their right mind thinks it would with it.
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This. If the company can't float, let it sink.
 
This is why you can't have public financed ventures - politicians will not hesitate to risk other peoples money if they can be shown to be "creating jobs" or whatever nonsense they used to get this through.

It's called a moral hazard - I keep what I win, you cover what I lose.

Caution, meet Wind...
 
Government needs to stay out of business. Especially non essential businesses like game companies. An argument can be made for Solyndra or Tesla Motors but goddamn 38 Studios????
 
I want to know how it takes $75 million and 701 employees to release one mediocre game...
 
Things are not that simple anymore. Now days government must take an active role in subsidizing companies. If you do not do this these companies leave your, city, state, country! I know it seems messed up but it is just reality, China is an expert in doing this. Prop up companies, protect them, subsidize them allow them to kill off all competition then let them reap the profits. Most countries and local governments are beginning to see the reality of this global tactic, its the new form of capitalism. Of course the problem gets to be that local politicians often have no clue what they are doing in a market sector and do stupid things like support companies with terrible products, bad business models and so on.

You also have the whole issue with politicians trying to prove they created jobs which often clouds their judgement. On top of that you realize that companies start catching wind of these practices and abusing it. There are whole companies out there that do nothing but specialize in searching for local initiatives then using their knowledge of how things run inside governments to outbid, others take the project then squeeze the most profit out of the money allocated.

It does not matter if the business is core or important to local governments such as small states, or cities, it only matters that it is core to the success of the town or more specifically the people in office.
 
There is an alternative, which includes another company purchasing the assets and talent from this studio such that the bulk of the repayment is already made. In the event that this company has the bulk of a completed project, but not enough funding to see it through, it could be a pretty decent buy for a larger studio if they estimate the company's products (current and future) to exceed the current market value.
 
rudy said:
Things are not that simple anymore. Now days government must take an active role in subsidizing companies.
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No. Government's role is regulation and public goods, and no further.



As for the folks arguing back and forth about bailing out, keeping stock, etc...go read the actual article, none of that is relevant to the situation.
 
Aluisious said:
No. Government's role is regulation and public goods, and no further.



As for the folks arguing back and forth about bailing out, keeping stock, etc...go read the actual article, none of that is relevant to the situation.
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so what is your definition of a bailout?
 
The problem is this stupid MMO they've been hinting at for something like 6-8 years now is never going to make the money they expected when they started production. MMO's aren't the cash cows that people thought they were after Blizzards (singular) success with World of Warcraft. That's why we've seen a massive swing towards the free to play model of the past year or two, the subscription model just isn't properly sustainable anymore in that space.
 
Nightrainsrt4 said:
I'm playing through KoA now, and it feels like it was meant to be an MMO, they just forgot to add the extra players. It plays just like a fantasy MMO, but with some twists to the combat and stat system.

That is quite an investment for a government to make into the games sector, especially as they are such a gamble. Unless you already have a proven formula you know people will gobble up, any game is a huge risk. Even great games can be overlooked and bring companies crashing down.
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That's exactly what it was meant to be. They spent so much money building the MMO that they realized they would be broke before the game came out, so they shifted gears and adapted their existing MMO resources into a single player game to try and bring in some money.

KoA is quite literally an MMO stripped into a single player experience.
 
pstang said:
so what is your definition of a bailout?
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A bailout is where the government lends or gives money to a company so it continues operating. This is an instance where the government guaranteed a loan for a company, and will have to repay private investors because the company did fail.
 
Aluisious said:
No. Government's role is regulation and public goods, and no further.



As for the folks arguing back and forth about bailing out, keeping stock, etc...go read the actual article, none of that is relevant to the situation.
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You can say whatever you want but it does not make it so. Governments everywhere from small to large world wide are already doing this and more are joining in.

Back to the OP someone told me RI was one of the most corrupt states in the country so maybe that had something to do with this.
 
My point is that ideally, government's role is as I said.

This whole thing were governments supplicate to corporations more powerful than they is a painfully obvious race to the bottom. It's outright theft from taxpayers.
 
Maybe but its working pretty well for China, Germany and other countries who are doing better than their counterparts who employed this well. Working out pretty well for their tax payer so far too who are seeing the benifit in the economy and jobs.
 
Socialism at its finest.

Too bad government doesn't realize that it's not responsible for creating jobs. Oh, well. I hope the rubes enjoy paying off their unanticipated debt.
 
rudy said:
Working out pretty well for their tax payer so far too who are seeing the benifit in the economy and jobs.
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You've got to be kidding. Maybe you haven't noticed that the entire fucking world is insolvent?
 
Madoc said:
Socialism at its finest.
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Aluisious said:
Giving taxpayer money to private corporations is not socialism.
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Sad but true. With socialism, the government owns or has a great stake in the means of production; In whatever fucked up economic system we're using in America, the means of "production" (if it can be called that anymore) owns the government.

Corporations are getting everything they want from the government these days. They basically run the government because they control what taxes go where. Our tax dollars are being fed into these failed corporations to keep them afloat so they can keep on claiming that capitalism is working just fine. Then they reinvest a portion of the money back into bribery of politicians.

"I hope we shall crush ... in its birth the aristocracy of our moneyed corporations, which dare already to challenge our government to a trial of strength and bid defiance to the laws of our country" -Thomas Jefferson never got his wish and we're all paying the price.
 
I hate to see it when a game studio goes under... best of luck 38!
 
fattypants said:
Sad but true. With socialism, the government owns or has a great stake in the means of production; In whatever fucked up economic system we're using in America, the means of "production" (if it can be called that anymore) owns the government.

Corporations are getting everything they want from the government these days. They basically run the government because they control what taxes go where. Our tax dollars are being fed into these failed corporations to keep them afloat so they can keep on claiming that capitalism is working just fine. Then they reinvest a portion of the money back into bribery of politicians.

"I hope we shall crush ... in its birth the aristocracy of our moneyed corporations, which dare already to challenge our government to a trial of strength and bid defiance to the laws of our country" -Thomas Jefferson never got his wish and we're all paying the price.
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The problem is government intervention into corporations. It's called Corporatism, which is economic fascism. A great example is General Motors ... GM never wanted to make the Volt as its own studies said it was unfeasible to push it past a concept design, but the government forced them to do just that to support the governments green agenda.

So you are incorrect about Corporations getting everything they want ... its government that is getting whatever it wants regardless of what the market wants. These bailouts granted government control over what these companies which are now being used as political tools to push whatever populist agenda is best for the government rather then what is best for the worker, investor, and market.
 
Taldren said:
The problem is government intervention into corporations. It's called Corporatism, which is economic fascism. A great example is General Motors ... GM never wanted to make the Volt as its own studies said it was unfeasible to push it past a concept design, but the government forced them to do just that to support the governments green agenda.

So you are incorrect about Corporations getting everything they want ... its government that is getting whatever it wants regardless of what the market wants. These bailouts granted government control over what these companies which are now being used as political tools to push whatever populist agenda is best for the government rather then what is best for the worker, investor, and market.
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You had to jump through a whole lot of mental hoops and brain contortions to get to that cockeyed conclusion. Water is wet, the sky is blue, and the government is clearly puppeteered by corporations in the U.S.
 
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