Sony Announces Cuts To Gaming Worldwide. 900 Laid Off. Guerilla, Insomniac, And Naughty Dog Impacted

In a public statement, Sony Interactive Entertainment announced it would be laying off approximately 900 workers worldwide attached to its game developing and publishing divisions. As per their statement, SIE London Studio is being entirely shut down with Firesprite also being hit with major downsizing. London Studio and London Studio have recently been closely attached and connected with PlayStation VR and PlayStation VR2, though virtual reality were not a complete representation of their gaming output.

Insomniac Games, Guerrilla Games, and Naughty Dog, Inc. all have confirmed that they have also been impacted by these cuts with Insomniac publishing the following statement on their official Twitter account:

The cuts to Guerrilla are reportedly around the 40 mark or about 10% of the studio's working staff. Several sources have confirmed that the cuts have also coincided with numerous game projects being canned, with Jason Schreier reporting that a "Twisted Metal live-service game that was in development at UK-based studio Firesprite" was one of the projects to get the axe. What is an unfortunate reflection of the importance of workplace regulations, Sony's own press release is a perfect encapsulation of the different layers of regulations regarding workplace layoffs in the United States, Europe, and Japan:

For those unaware, due to regulations, when cuts do happen, Japanese workers are given a flat three month’s severance as the regulatory minimum. Sometimes you will see corporations offer stock benefit packages with severance, but that is a best case scenario. Also, with insurance, your benefits are basically gone and you often need to rely on national programs to fill the void.

Sony as a company has been signaling that cuts were coming for a while, though, its gaming investments were not the issues as reported in their last 2023 shareholder meetings. Gaming saw multiple positive revisions in terms of raw revenue, but that was not enough to off-set Sony's financial services division plunging by 61% during the first quarter of 2023 and a a 6% decrease in revenue in its movie division. That said, Sony's movie division does seem to be turning the corner for 2024. Sony's technology and non-gaming hardware divisions have been struggling for years, their investments in cloud processing are still failing to take off, and while gaming has been a growing portion of their company portfolio, that's becoming and issue as sales of consoles plateau on the PS5. Likewise, Sony's operating income for its game and network service is decreasing, to be specific, SEI's operating income fell from ¥86.1 billion ($574.5 million) to ¥30.1 billion ($200.8 million), which is likely why they felt compelled to make moves on studios that turned out massive successes last year.

One of the most uncanny things to come from this are images of Jim Ryan visiting London Studio during his farewell tour as he gears up for a full retirement less than a week ago.

I mentioned it in the Game Mess Mornings chat and Grubb shouted it out, but Rob Zacny wrote a banger of a piece on this topic, framing it as if Sony was the Roman Empire. It's a great bit of writing:

Pivot To Decimation

Many of our competitors have already adopted similar lean practices and while we have crushed them in every open battle for the past decade, we have no choice but to accept that this is where our business is headed. Toward a paradigm where attrition goes from being a problem to be feared to an opportunity for us to embrace.

This is a sad time to be a member of the 9th, and I encourage all of you who remain to reach out to your former coworkers. To strangle and club them, yes, but also to comfort them and wish them well in the Stygian abyss, where I know we all expect great things from them.

I do not care about the Twisted Metal series these days, so I wouldn't mind about that, meanwhile, the only three PlayStation first-parties I would like to see them return are Motorstorm, WipEout, and Resogun.

I reckon XDev should be able to develop the new Motorstorm and WipEout, or EA acquire the rights of Motorstorm so Codemasters Cheshire (Formerly known as Evolution Studios) to develop it.

Edit: Well, this situation reminds me of Microsoft's lay-off from last month, it's pretty unfortunate when this happens to video game publishing companies, however, I do wish both Sony and Microsoft their studios would be able to hire more good writers, directors, etc. So they can develop their future respective projects, meanwhile what if the GT7 PC version gets announced, I want the optimization to be good.

I am probably one of the few who does care about Twisted Metal, but hearing that it was a live service game — yeah, no thanks. Would rather see a straight port of TM: Head-On than a brand new live service TM game.

Live service games are a very hard market to thrive in these days. The usual suspects, like Destiny, Fortnite, GTA Online, and more have pretty much taken up all the player base. This is why it's hard for new games to last, and it doesn't even matter if the game is good. Most people who played The Finals say it's a good game and a nice change from the battleground games. Yet, it's slowly losing players. Helldivers 2 might seem like a modern exception, but the original F2P already created a huge player base. All the developers had to do was not drop the ball with the now paid sequel, and they didn't.

With all that said, it was smart of them to can the Twisted Metal live service game. History has shown, live service games about vehicle combat don't do so well. But seeing people being hired on to do a project, only to get fired when it falls apart, is never a good thing.

The Insomniac layoffs have really put a fine point on this entire industry-wide saga. You really can do everything right, and it will not help you keep your job. The corporate greed and shareholder idiocy are going to fuck up this industry (more than they have already) while enhancing absolutely nothing.

Especially given the same shareholders cheering on and profiting from these layoffs were probably the same ones pressuring these companies to push heavily on implementing live service game systems and other ideas that have placed all these companies in their current position in the first place. There's a similar thing going on in tech right now where shareholders for every seemingly every tech company are demanding they put forth an "AI strategy", no matter how poorly fit the current LLM tech trend is for a given company. They're the same type of people who demanded every tech company have a blockchain strategy five years ago. They never learn and just chase trends.

It's just stupid.