Loading Screen: Embracer Threaten Another Studio, Playstation’s Live Service Failure and The Dead Overwatch League

Today we’ve got Embracer threatening to close a studio before it even releases a game, Sony unable to release Live Service games on schedule and the Overwatch League being definitively dead.

Embracer Considering Closing Timesplitter Studio With No Games

Remember how in 2021, explicitly at the request of audiences - Deep Silver under Embracer paid for the founding of a new version of Free Radical Design?

A team who were going to be explicitly there to bring back the Timesplitters IP - led by original creators Steve Ellis and David Doak.
This was a massive step because involving the folks who originally created any series is a great way to honour their original contributions.

Embracer were so keen to capitalise on interest that they didn’t even wait till there was a prototype or testing - they announced it on day one.

• In 2023, fuck it none of that matters.
  • No game release and probably no studio either.

Embracer is currently working out the next steps , including potentially closure or sale - as broken by VGC.
Again, as we’ve seen many times this year - all part of Embracer’s restructuring efforts in the wake of their massive C-Suite deal failure with Saudi Arabia’s Savvy Gaming.

So what does happen next?
As VGC put it, Embracer has some legal obligations to fulfil - because English law requires it.

As required by UK employment law, Plaion – the Embracer division which runs Free Radical – must consult employees for a minimum of 30 days before making any redundancies, including exploring ways of avoiding them.

So in theory - they could be sold to some other company. But who would even want to buy them?

One thing worth thinking about - Free Radical probably don’t own the rights to the Timesplitters IP.
Embracer explicitly set the team up to take advantage of the fact they already owned those.

So effectively what anyone else would be buying if they buy Free Radical is a name - and whatever experience remains.
Which may not actually be that much.
Because per VGC - the staff who have been told about this mess aren’t waiting around for Embracer to drop the axe:

VGC analysis of LinkedIn and social media shows that, within just the last 24 hours, at least 15 people employed at Free Radical have already published posts saying they’re looking for work.
That includes a lead game designer, senior artist, senior technical artist, game designer and the studio’s IT manager.

Once more - IP Hoarding and Corporate malpractice has meant that a studio full of talented veterans and skilled newcomers has been laid out as part of C-Suite Level mistakes in planning.

This time they didn’t even get the chance to fail first.

Now the Timesplitters IP will either go back in a box, or to the highest bidder - and the teams who originally crafted those games probably won’t be involved at all.

Sony’s Live Service Gambit Failing Confirmed

Sony are being forced to make less live services.
During their Q3 Earnings call (where the company’s operating income stayed comparatively below FY21,20 and 19 despite increased revenues)
Sony confirmed what has been widely reported and understood for the last year.

They intended to release 12 Live Service Titles before the end of FY25.
As of right now at time of writing they have maybe two.
So they won’t be meeting that goal. Not even close.
Instead - they’re delaying half of those titles to beyond 2025 - and the other half are now targeting 2025 or sooner.

Incoming Sony Interactive Entertainment CEO Hiroki Totoki confirmed on the call (as captured by VGC) that the plan has now changed.
Seemingly being attributed specifically to the Bungie Portfolio review that had been discussed.

We are reviewing this… we are trying as much as possible to ensure [these games] are enjoyed and liked by gamers for a long time,” he said. “[Of] the 12 titles, six titles will be released by FY25 – that’s our current plan. [As for] the remaining six titles, we are still working on that.

“That’s the total number of live service and multiplayers titles [and] mid-to-long-term we want to [push] this kind of service and that’s the unchanged policy of the company. It’s not like we stick to certain titles, but game quality should be the most important [thing].”

As has been widely rumoured (and is believed to be behind Sony’s restructuring plans that have affected so many teams with layoffs) the Live Service games aren’t even meeting the standards of Destiny in terms of being viable products.

So Sony are slowing down - but seemingly not yet confirming cancellation - on development of these projects, but let's just extrapolate that out for a bit.

• Sony was banking on this live service cash coming in - to recoup development costs and meet their new targets.
• Now if these projects aren’t cancelled, that’s money still being pumped in to them.
• While that operating income isn’t replenishing as fast.

There is a reckoning coming - one that Playstation Owned Studios are already feeling.
Playstation now has half the chance to achieve a successful live service than they originally planned.
What happens to their studios if they don’t manage it?

The Overwatch League Now Definitively Dead

In a statement provided to GGRecon - Activision Blizzard have confirmed that the Overwatch League is now officially over as a concept - and that obviously they have something else planned.

We are transitioning from the Overwatch League and evolving competitive Overwatch in a new direction. We are grateful to everyone who made OWL possible and remain focused on building our vision of a revitalized esports program. We are excited to share details with you all in the near future.

This followed statements this morning from team owners like OverActive Media (Owners of the Toronto Defiant) who issued a press statement on the 8th - confirming their departure from the league, and the uptake of Activision Blizzard’s buyout.

The deal was that if the teams wanted to leave, they would say as much in a vote this month - and a 2/3 majority has carried it.
The OWL teams aren’t willing to try and make it work any more under the current model - and they’d get a cash payout to cover franchise fees/cushion the blow to incomes.

Under the terms of the agreement, OverActive will receive a termination payment of $8.26 million (USD 6 million) from Activision Blizzard.

So what’s next?
There doesn’t seem to be the same kind of grand strategy in place that led to the Overwatch League’s formation - and considering that much of that was the outgoing CEO Bobby Kotick’s idea, it’s probably no great surprise.
However the Jacob Wolf Report’s sources are pretty clear on what they expect to happen next.

Plans for the new-look Overwatch League are still up in the air, but it’s likely that it will be an open-circuit system similar to what existed prior to the formation of the franchise league in 2018.

Activision Blizzard’s sought proposals for who will run that new system over the past few months and the ESL FACEIT Group, backed with an unmatched level of resources in the current grim state of the esports industry, will likely emerge the victor based on current discussions, sources said.

This is unsurprising - as JWR notes - because not only is that group already handling the broadcasts for the Call of Duty League, but apparently those conversations had begun before the vote occurred.

It ultimately feels like, especially in the wake of the acquisition by Microsoft, there is no plan for esports right now at Activision Blizzard.

Stopgap measures like having the COD league provider step in, and a straight return to what structure was there before, suggest this is basically the professional scene being put on life support.

Perhaps under the new Blizzard under Microsoft - there will be a push towards a wider plan again. Maybe this time though, there’ll be a plan that’s more community driven, and less corporately imposed.