Xbox boss Phil Spencer has addressed the recent closure of a number of studios at Microsoft’s gaming business, insisting he has to make “hard decisions” to run a sustainable business.
Speaking to IGN’s Ryan McCaffrey at IGN Live, Spencer briefly commented on the shock decision to shut Redfall developer Arkane Austin and Hi-Fi Rush developer Tango Gameworks as part of sweeping layoffs affecting some 1,900 staff.
“The closure of any team is hard obviously on the individuals there, hard on the team,” Spencer said. “I haven’t been talking publicly about this, because right now is the time for us to focus on the team and the individuals. It’s obviously a decision that’s very hard on them, and I want to make sure through severance and other things that we’re doing the right thing for the individuals on the team. It’s not about my PR, it’s not about Xbox PR. It’s about those teams.
“In the end, I’ve said over and over, I have to run a sustainable business inside the company and grow, and that means sometimes I have to make hard decisions that frankly are not decisions I love, but decisions that somebody needs to go make.
“We will continue to go forward. We will continue to invest in what we’re trying to go do in Xbox and build the best business we can, which ensures we can continue to do shows like the one we just did.”
Microsoft announced to staff in May that it would be closing Redfall maker Arkane Austin, Hi-Fi Rush and The Evil Within developer Tango Gameworks, and Alpha Dog Games, while Roundhouse Studios would be absorbed by ZeniMax Online Studios. The move led to shock and anger throughout the industry, especially considering one of Xbox’s most successful recent exclusives, Hi-Fi Rush, was developed by Tango, a studio that was absorbed by Microsoft via its acquisition of parent company Zenimax in 2021.
It’s the first time Spencer has commented on the studio closures since they were announced, and follows similar comments from other Xbox executives who were asked about the decision.
A few days after the layoffs, Xbox President Sarah Bond was asked about them at a Bloomberg conference, where she insisted the Xbox business remains healthy for the long-term during what she called “this moment of transition.”
Microsoft announced it would be laying off 1,900 staff from its video game workforce back in January. It was only one of a number of devastating cuts that the industry has been hit with over the past year, with other companies including Sony, Riot, and Epic laying off hundreds of staff.
For more, read our report exploring the recent uptick of layoffs across the video game industry. And for everything announced during the Xbox Showcase, check out our roundup.
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