Xbox plans more job cuts in focus shift from Game Pass to multiformat claim sources

Insiders suggest the job cuts have not ended at Xbox, as Microsoft considers more price hikes and not putting Call Of Duty on Game Pass.

The closure of multiple game studios at Xbox wasn’t a complete surprise, given what always tends to happen as the result of any large scale acquisition, but it seems the shuttering of Tango Gameworks, Arkane Austin, and others may be just part of a much large shift in strategy at Xbox.

It’s becoming increasingly obvious that Game Pass, and game subscriptions in general, have not taken off in the way that Microsoft hoped, and two major sources claim that as a result Xbox is refocusing its business to publish more previously exclusive titles on PlayStation and Switch.

The time frames involved are not clear but this month’s Senua’s Saga: Hellblade 2 has already been rumoured, although supposedly Microsoft is not certain it will be a ‘success’ even as a multiformat release – which does not bode well for developer Ninja Theory.

At the beginning of the year, when rumours first emerged that Microsoft would be making some of its games multiformat, there was talk of in-fighting at the company, between those in favour of the idea and those against.

The final announcement, of four lower profile titles, seems to have been a compromise but it appears that, given the continued lack of growth for Game Pass, the multiformat argument is winning and that more multiformat releases are now expected.

According to sources at The Verge, there is also debate within Microsoft as to whether a price rise is need for Game Pass Ultimate and if they really want to put new Call of Duty games on the service on day one.

The problem for Microsoft is not only that Game Pass uptake has been slower than expected but that it’s encouraging even those that don’t subscribe not to pay full price for new games.

Considering how important Activision Blizzard games are for Microsoft at the moment, making new Call Of Duty games available on Game Pass from launch would severely constrict what is now one of their most important revenue streams.

On top of this, The Verge suggests that Xbox Game Studios is in line for cutbacks as well, which could impact anyone from 343 Industries to Double Fine.

The site is careful to point out that little is currently certain though, with arguments going back and forth. Although they did at least end with a not-so-subtle hint that a new Doom game is set to be announced this June, at the Xbox Games Showcase.

Bloomberg’s Jason Schreier also reports that staff have been warned of further cuts in the future and that producers, quality assurance testers, and other staff at Bethesda parent company ZeniMax have already been offered voluntary severance packages.

According to Schreier, no explanation was given to staff as to why Tango Gameworks was shut, even as it was apparently making plans for a sequel to Hi-Fi Rush.

Supposedly, Xbox Game Studios Matt Booty has said that, in general, Xbox’s studios have been spread too thin and that many divisions feel they are understaffed. So his answer was to… layoff hundreds of people, apparently in an attempt to ‘free up resources elsewhere’.

Booty apparently claimed that Arkane Austin was not closed because of the failure of Redfall but instead because it and Tango Gameworks wanted to hire more staff to work on new projects. Arkane Austin was apparently pitching a new ‘immersive sim’ – possibly a new Dishonored game.

The general consensus within Microsoft seems to be that it needs to put ‘more focus on fewer projects’, which also seems a strange conclusion to come to, given Xbox’s often sparse release schedule this generation.

Schreier also confirms that other inevitability of a major acquisition like Activision Blizzard (at $69 billion the biggest in both gaming and Microsoft’s history) and that is greater scrutiny from higher-ups at Microsoft, who want to see a return on their investment as soon as possible.

That’s clearly not going to happen quickly though and that seems certain to ensure more turmoil for Xbox, which will continue to ripple out and affect the industry at large.