Xbox Studios Are Being "Punished For Following Orders", As They Were Reportedly Told To Focus On Awards, Not Sales

Compulsion and Double Fine are said to be on the brink of closure in Xbox's latest round of layoffs. This comes after their latest games failed to translate into commercial hits. But apparently, they might have been exactly what Xbox was after when they entered development.

This comes from Bloomberg reporter Jason Schreier, who just released a new video outlining how Xbox found itself in this situation. According to Schreier, Xbox-owned studios were told that game sales were not a priority, and they should instead focus on padding out Game Pass with critical hits that win awards and drive subscriptions - something that they're now being punished for.

Jason Schreier Explains Why Games Like South Of Midnight And Kiln Could Have Been Considered Successful Years Ago

"We've seen a lot of games from the Xbox that have not been profitable, games like South of Midnight and Keeper," says Schreier. "But I think it's worth noting and hopefully having a little bit of empathy for these studios and the people who work there, because the messaging from above has just changed so much over the last five years."

He explains further: "Games start development like four or five years before they actually come out. So when you start a project in 2020 or 2021 and that's under one mandate, and suddenly that mandate changes two or three years later - but it's too late to change course - that can be a problem."

He says that there was a very different mandate in place earlier in this console generation, when games like South of Midnight would have been in the earlier stages of development. "When some of these projects started getting greenlit and started to enter development, the messaging was not that you must hit X amount of profitability," Schreier explains. "The messaging was: make good games, help us fill out Game Pass, try to win awards. Of course, don't lose money, break even, but this is not a profit play. Game Pass is the north star."

Bethesda, ID Software, And BioWare Could Be Part Of Xbox’s “Massive Bloodbath”

Xbox's woes look set to continue long into the summer.

That would explain the recent crop of Xbox releases. Obsidian did its part to pad out Game Pass with three games last year: Avowed, Grounded 2, and The Outer Worlds 2. It doesn't seem that the RPGs sold particularly well, but it gave Game Pass two big open-world releases. Now, Obsidian is expected to be caught up in the upcoming layoffs.

Similarly, South of Midnight bagged a few awards for Xbox, taking home prizes at The Game Awards, DICE, and the BAFTAs. Now, it's being reported that Compulsion is fighting for its future. Not even announcing a new project is enough to spare a studio, as Ninja Theory is said to be on the brink of closure, despite only revealing Senua days ago.

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