The promise of a more creative first-party ecosystem at Xbox starts to fall apart.
Earlier reports suggested that Microsoft was preparing a major wave of layoffs across its gaming division, and now the situation may become even worse. According to industry veteran George Broussard, the upcoming Xbox cuts could become one of the largest single layoff events in gaming history.
That is still officially unconfirmed, but it adds to a growing wave of rumours suggesting that Xbox’s internal reset could hit far more than just a few isolated teams. Adding to the list of possible closures/layoffs comes Undead Labs, the developer of State of Decay, a franchise that still has real potential inside the Xbox ecosystem. But with its development problems for the third entry, it would not surprise anyone if Xbox decided to add this studio to the chopping block.
It feels like this is not just another round of corporate restructuring, but more like an impending cataclysm around Xbox’s creative teams. Moving away from smaller, more experimental games to safe franchises would fixate a long-term strategy from which there might be no return in the near future.
Years have passed with Xbox telling players that Game Pass would create room for different kinds of games. If the end result after the acquisition spree is that studios get closed, then niche games at Xbox will become a rarity.
Some studios may survive. Some could be sold, spun off, or restructured instead of fully closed. But the mood around Xbox right now is clearly tense, and the timing lines up with Microsoft’s fiscal year ending on June 30. The waiting game has become even more brutal.