Anyone working in the video game industry must feel as if they have a target painted on their back. 2023 saw at least 6000 people lose their jobs and 2024 is somehow looking much worse. January saw Microsoft sack 9000 people, there’s been a raft of smaller studio closures and staff cuts. Now Sony has joined this miserable party, handing 900 PlayStation workers their notices across the company.
This includes the entirety of London Studios, which had been focused on PSVR2 projects, as well as at The Last of Us and Uncharted developer Naughty Dog and Marvel’s Spider-Man studio Insomniac Games. With the PlayStation 5 breaking sales records and the industry bringing in enormous revenues you’re right to wonder why this is necessary.
Sony’s reasoning
President and CEO of Sony Interactive Entertainment put out a statement about their “extremely hard” decision that was heavy on corporate platitudes and light on details. The closest he got to justifying getting rid of 8% of the company was:
“The industry has changed immensely, and we need to future ready ourselves to set the business up for what lies ahead. We need to deliver on expectations from developers and gamers and continue to propel future technology in gaming, so we took a step back to ensure we are set up to continue bringing the best gaming experiences to the community.”
In an internal email, he continued in the same vein:
“We had to step back, look at our business holistically, and move forward focusing on the long-term sustainability of the company and delivering the best experiences possible for our community.”
This is meaningless bumph, so let’s look elsewhere.
Head of PlayStation Studios Hermen Hulst followed this up with his own statement:
“PlayStation 5 is in its fourth year, and we are at a stage where we need to step back and look at what our business needs. At the same time, our industry has experienced continuing and fundamental change which affects how we all create, and play, games.
…
To take on these challenges, PlayStation Studios had to grow. … But growth itself is not an ambition. PlayStation Studios is committed to continually discovering ways to work together; collaborating and combining our efforts to ensure that we are able to craft games that push the boundaries of play and deliver what you expect from us. We looked at our studios and our portfolio, evaluating projects in various stages of development, and have decided that some of those projects will not move forward.”
Not particular illuminating either. What are they dancing around?
The real reason
Despite being incredibly profitable the video game industry is currently undergoing a contraction. During the COVID lockdowns billions of people around the world were stuck inside their homes and, naturally, video game hardware and software sales skyrocketed. A sensible person may point out that a wholly unique event like a pandemic lockdown is a time-limited event, but that’s not thinking like an corporate executive. Nope, the good times will certainly last forever, so it’s time to massively expand our staff and begin ambitious and risky projects.
Reality soon arrived to bite the industry in the butt. The financial heights of the COVID lockdowns have long since receded, leaving companies like Sony and Microsoft with more employees than they need and for all their fuzzy words about the company being a family, they will be merciless in ensuring maximum profitability. Could the CEOs themselves take a huge pay cut and accept responsibility? Yeah right, and pigs might fly…
Or, to summarize, “that’s capitalism, baby!”. We only have sympathy to those laid off, a