Microsoft Shutting Down 4 Bethesda Studios Including Arkane Austin and Tango Gameworks

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Microsoft is shutting down four of Bethesda studios acquired through the 2020 Bethesda deal. Among these closures are Redfall developer Arkane Austin and the studio behind Hi-Fi Rush, Tango Gameworks.

Microsoft Shutting Down Four Bethesda Studios Including Arkane Austin and Tango Gameworks

The news of the closures was conveyed to Arkane, Tango, Alpha Dog, and Roundhouse staff via email from Matt Booty, the head of Xbox Game Studios. According to a memo sent to the employees, all four studios will be closed, with some staff members being reassigned to other teams within the company. Booty explained that Microsoft’s decision aims to concentrate resources on “high-impact titles” and Bethesda’s existing game catalog.

Booty informed the staff members that some would be reassigned to different teams and some would be laid off, adding that the decision was made based on a “reprioritization of titles and resources.” Specifically, developers from Arkane Austin will join other Bethesda studios, while the entire Roundhouse team will integrate into Zenimax Online Studios to contribute to The Elder Scrolls Online.

The mail sent by Booty read: “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 reprioritisation of titles and resources means a few teams will be realigned to others and that some of our colleagues will be leaving us.”

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Aside from the studio closures, Booty mentioned that a small number of individuals in Bethesda’s publishing and corporate sectors will also be laid off.

Regarding the games in development at these studios, Redfall will no longer receive updates, and customers who purchased the “Hero Pass” DLC will receive compensation of some kind. Then Alpha Dog’s game Mighty Doom will be discontinued on August 7, and Tango Gameworks, known for titles like The Evil Within and Ghostwire: Tokyo, will also close its doors. However, Booty assured that Hi-Fi Rush will remain accessible on its current platforms.

He went on to say, “These changes are not a reflection of the creativity and skill of the talented individuals at these teams or the risks they took to try new things. I acknowledge that these changes are also disruptive to the various support teams across ZeniMax and Bethesda that bring our games to market. We are making these tough decisions to create capacity to increase investment in other parts of our portfolio and focus on our priority games.”

Despite the closures, Booty reaffirmed Bethesda’s importance within Xbox, emphasizing its role in shaping the company’s future in the gaming industry. He also expressed confidence in the remaining Bethesda teams to innovate, explore new concepts, and expand existing franchises.

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He said, “As we align our plans and resources to best set ourselves up for success in this complex and changing industry, our teams across Arkane Lyon, Bethesda Game Studios, id Software, MachineGames, ZeniMax Online Studios and the Bethesda publishing and corporate teams will be well-positioned to build new IP, explore new game concepts, and expand on our existing franchises.”

Well, within the video game sector, over 10,000 jobs were lost in the previous year; five months into 2024, that number is almost the same. Moreover, this announcement comes on the heels of Microsoft’s recent layoffs, which affected approximately 8% of its workforce (1,900 people) following the acquisition of Activision Blizzard.

Now, while it’s unclear if these recent Bethesda studio closures are regarded as a separate round of cuts or as a component of the 1,900 layoffs, the gaming industry has already seen a significant number of job losses in 2024.

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