Microsoft Lays Off 1,900 Activision Blizzard And Xbox Employees

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Zorachus

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https://twitter.com/Qwik/status/1750527310493868293

  • Mike Ybarra announced that he is leaving Blizzard today.
  • Allen Adham, who has been with Blizzard since its founding, is also leaving.
  • Odyssey, the title of the survival game in development at Blizzard, has also been canceled.
  • It is unknown which people have been affected by the 1,900 layoffs at this time. Reports say employees don't even know yet.
 
At always looks bad, but this is more or less the way it has been for big studios. Working for a gaming studio is akin to being a seasonal employee, work is plentiful when there is a rush on getting something done by a particular date, but once your usefulness for that project passes if there isn't anything else immediately brewing you're in the unemployment line
 
Gideon said:
Blizzard spends way too much money and I don't think DIablo IV sold like they thought it would. Trimming at that studio is long overdue and hopefully they become a bit more focused.
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Diablo IV sold more than 12 million copies in the first week. Just think about how many copies have sold since then. By comparison, Diablo III sold at the same rate that Diablo IV did at release. I hardly think that Blizzard sees Diablo IV sales as a disappointment.
 
Gideon said:
Blizzard spends way too much money and I don't think DIablo IV sold like they thought it would. Trimming at that studio is long overdue and hopefully they become a bit more focused.
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Good point.

Now if Blizzard gets the green light to make a new game, bring on WoD: World of Diablo MMO, a more mature and darker WoW, built on an all new game engine, using A.I. to control enemies, bosses, and NPC's.
 
Armenius said:
Diablo IV sold more than 12 million copies in the first week. Just think about how many copies have sold since then. By comparison, Diablo III sold at the same rate that Diablo IV did at release. I hardly think that Blizzard sees Diablo IV sales as a disappointment.
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The article says Diablo IV *sold* well, but that it isn't making the kind of money through live services that they wanted.
 
1_rick said:
The article says Diablo IV *sold* well, but that it isn't making the kind of money through live services that they wanted.
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F live services. What happened to just buying the game for the full $60 price and having the game supported and updated for years without needing to spend one more penny on the game. Yeah I can see having a price for expansions like $29 or so, but that's it.
 
Armenius said:
When they sell skins for $30 on top of charging $70 for the game, is it any surprise that most players are not purchasing microtransactions?
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Not at all.

I paid $10 for the battle pass for season 2. Contemplating doing the same for season 3, but I'll wait a few days before deciding. I definitely won't do it every time.
 
Zorachus said:
F live services. What happened to just buying the game for the full $60 price and having the game supported and updated for years without needing to spend one more penny on the game. Yeah I can see having a price for expansions like $29 or so, but that's it.
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Because everyone's greedy these days--gotta grind every dollar from every customer.
 
Armenius said:
Diablo IV sold more than 12 million copies in the first week. Just think about how many copies have sold since then. By comparison, Diablo III sold at the same rate that Diablo IV did at release. I hardly think that Blizzard sees Diablo IV sales as a disappointment.
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People were playing Diablo III for years, all my friends that bought it stopped playing it already. They expected it to be a cash cow and people would keep spending money on in the store and no one really is. Maybe not a disappointment but income from it dropped off much faster then they wanted.
 
I know one guy who was acquired into Activision-Blizzard through Proletariat.

No idea if he is impacted yet.

Amusingly enough, Activision-Blizzard wasn't interested in the games they had either on the market or in the pipeline. They acquired them entirely for the employees. Less than 2 years ago. And now there are layoffs :p


Lets also keep in mind that Activision-Blizzard is huge. They had - what - almost 20,000 employees? While 1,900 layoffs is big for any company, it's not quite as big as it looks. 80-85% of the people who worked there last week are still working there next week.
 
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Zarathustra[H] said:
I know one guy who was acquired in tho Activision-Blizzard through Proletariat.

No idea if he is impacted yet.

Amusingly enough, Activision-Blizzard wasn't interested in the games they had either on the market or in the pipeline. They acquired them entirely for the employees. Less than 2 years ago. And now there are layoffs :p


Lets also keep in mind that Activision-Blizzard is huge. They had - what - almost 20,000 employees? While 1,900 layoffs is big for any company, it's not quite as big as it looks. 80-85% of the people who worked there last week are still working there next week.
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They were put in the World of Warcraft mines. Dragonflight was their first project for Blizzard. Spellbreak was a promising game, but if I recall correctly they ruined it by responding positively to all the criticism they were getting. I could be wrong.
 
Considering layoff round in the same industry in 2023-early 2024 (Epic cut 800, Riot, Unity, Twitch, Amazon, Bungie, EA) vs how little in the US they had in 2022...

Maybe game had a giant amount of issue and growth during the COVID years, that they need to adjust from, a bit like streaming and other serving at home business, more than saving possible from redundancies (that could stil be there but not the majority of that big number).
 
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Armenius said:
They were put in the World of Warcraft mines. Dragonflight was their first project for Blizzard. Spellbreak was a promising game, but if I recall correctly they ruined it by responding positively to all the criticism they were getting. I could be wrong.
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Yeah, I mean, Proletareat seemed like a decent enough company with some good ideas. They were kind of ahead of the curve with StreamLine, trying to develop something with streaming in mind, but it never took off, and instead the streaming market became dominated by other titles.

I always found their titles to be a little bit bland, but what proletariat did was also never up my alley, so I wasn't really into it, but it has been a rare glimpse into the industry for me through actual acquaintances.

I knew two folks there. One - a software guy - went on to be acquired into Activision-Blizzard, the other - an artist - went on to join as a contractor for an - at the time - unannounced CDPR title. (May have been Phantom Liberty, or something unreleased, not sure, I don't try to press people I know for information they shouldn't give out. That is just rude.)

Either way, Proletariat seemed like decent people. I hope most are OK with this series of layoffs. I mean, there are always redundancies in mergers and acquisitions, that is unavoidable, but I hope most do well.
 
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Armenius said:
They were put in the World of Warcraft mines. Dragonflight was their first project for Blizzard. Spellbreak was a promising game, but if I recall correctly they ruined it by responding positively to all the criticism they were getting. I could be wrong.
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Spellbreak was a really cool game, but very hardcore which did not appeal to a large audience. The actual fighting was extremely skill based and felt like you were playing Quake 3 Arena, but modern and in a battle royale setting. It was just awesome to play, but there weren't a ton of people playing it and it never got big.

There were community controversies like any early access game, but I think the overall picture is they tried to make it appeal to a larger, more mainstream audience and failed.
It probably wouldn't have been sustainable as a hardcore game with a small niche playerbase so I don't blame them for trying.
 
Zorachus said:
F live services. What happened to just buying the game for the full $60 price and having the game supported and updated for years without needing to spend one more penny on the game. Yeah I can see having a price for expansions like $29 or so, but that's it.
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What happened is that game companies discovered markets where people were willing to spend real money on cosmetics and items in game and it's a much more profitable business model than simply selling you the game.

It sucks, but that's how things work now.
 
1_rick said:
Because everyone's greedy these days--gotta grind every dollar from every customer.
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Honestly, I hate it as much as everyone else here, but that's on the consumer. The defense we have against this is not to buy it and prove the business model doesn't work. The problem is that there are more than enough people who are willing to do it. I don't fault the companies for taking advantage of that, but the unfortunate consequence is that it's led to a decline in the experience for us games as things like pay to win dynamics have become increasingly more common.
 
ABK had a ludicrous number of employees before the buyout, I read 17k(?) total or some silly number. I don't know which divisions are laid out by these, or how many were there right at buyout time, but there will have been a shit-load of duplicate divisions between MS and ABK.

Again, I don't know the specifics, for all I know they could have dumped every developer and kept the accountants. I doubt it though. I'm guessing that with the game being cancelled, at least some developers were shown the door.

Also: There's close to 0% chance Ybarra actually "quit". I'd bet a hobo's kidney he was helped out the door.
 
I am honestly surprised this number is not higher.

Microsoft exists in a unique position to consolidate and amalgamate its numerous studios and divisions under a single banner, they have more than enough talent and IPs under their belt, and they have the facilities and the resources, now it is about cutting out or restructuring the outliers and putting the organization to work.

Activision has its whole server and data center team, Blizzard has their own, I am sure Microsoft could take a few key individuals from there and migrate them all over to Azure, same with the facilities and their staff.
Art departments, sound engineering departments, technical support, and game testing, all departments that are notorious for a hire-fire project cycle, well now that they are combined, Microsoft can simply build them out as the Microsoft Games <department> and move them from IP to IP franchise to franchise, none of that hires them in for Game X, fire them all after launch, hire the all-new group for Game Y, rinse and repeat.

Microsoft has not spent that money without a plan and now they can start enacting it
 
Lakados said:
I am honestly surprised this number is not higher.

Microsoft exists in a unique position to consolidate and amalgamate its numerous studios and divisions under a single banner, they have more than enough talent and IPs under their belt, and they have the facilities and the resources, now it is about cutting out or restructuring the outliers and putting the organization to work.

Activision has its whole server and data center team, Blizzard has their own, I am sure Microsoft could take a few key individuals from there and migrate them all over to Azure, same with the facilities and their staff.
Art departments, sound engineering departments, technical support, and game testing, all departments that are notorious for a hire-fire project cycle, well now that they are combined, Microsoft can simply build them out as the Microsoft Games <department> and move them from IP to IP franchise to franchise, none of that hires them in for Game X, fire them all after launch, hire the all-new group for Game Y, rinse and repeat.

Microsoft has not spent that money without a plan and now they can start enacting it
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I was actually in the Switch DC in Vegas a couple of years ago and they me a tour of the whole place. Let me know which cage was the Activision cage. They told me in the afternoons and at night how those machines turned into afterburners. No way that kind of stuff survives corporate cost cutters. All those physical machines are going to be gone and it will all be in Azure in due time.
 
Lakados said:
Activision has its whole server and data center team, Blizzard has their own, I am sure Microsoft could take a few key individuals from there and migrate them all over to Azure
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MSFT doesn't force subsidies hands on moving to Azure.
 
Eulogy said:
MSFT doesn't force subsidies hands on moving to Azure.
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Even if they don't force them to Azure, do they need separate teams? How much of their jobs overlap, if they combine their job roles how many of them are redundant?
How many of those positions already exist within Microsoft that they could be rolled into? How many more of those job roles are then made redundant?
 
Lakados said:
Even if they don't force them to Azure, do they need separate teams? How much of their jobs overlap, if they combine their job roles how many of them are redundant?
How many of those positions already exist within Microsoft that they could be rolled into? How many more of those job roles are then made redundant?
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From what I've seen internally, successful things are _mostly_ left alone except where there's unfavorable overlap. But MSFT doesn't just view any role as being able to slot into another org/team/subsidiary and execute as well. Things at the VP/sVP/C level, and Finance often seem to be where they end up making the most consolidation (usually after a couple years, looking at the past few buys). In fact, looking at all of the game ones, most of the positions you listed haven't been combined at all. It'd be pretty profoundly stupid to, as well, and I think MSFT recognizes that at least. For now, anyway... though some of these acquisitions go back a good way. There are of course changes - folks get their payouts and leave, new talent cycles in, some folks do move between roles and studios voluntarily, so it's not like nothing changes. But I just don't see anything to support what you're saying happens, broadly.
 
Armenius said:
Diablo IV sold more than 12 million copies in the first week. Just think about how many copies have sold since then. By comparison, Diablo III sold at the same rate that Diablo IV did at release. I hardly think that Blizzard sees Diablo IV sales as a disappointment.
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Making profit is not enough. You gotta make exponentially more money. I doubt anyone would say that Diablo IV was a financial failure, but by comparison to something like Baldur's Gate 3 where it sold over 27 million copies. I know you're thinking that D4 sold so much more, but no they didn't. It's a disappointment to shareholders that no longer exist. Now it's Microsoft's shareholders they have to be concerned with. The reality is that Blizzard took a single player game like Diablo and then turned it into a multiplayer exclusive. What do you do in such a game? You grind for loot until the season is over, then you grind for loot again. It certainly didn't help that Baldur's Gate 3 was released and took the attention away from any game released in 2023.


View: https://youtu.be/eG_SllpH9bA?si=wm4pKPxioIPGqBAd
 
Lakados said:
I am honestly surprised this number is not higher.

Microsoft exists in a unique position to consolidate and amalgamate its numerous studios and divisions under a single banner, they have more than enough talent and IPs under their belt, and they have the facilities and the resources, now it is about cutting out or restructuring the outliers and putting the organization to work.

Activision has its whole server and data center team, Blizzard has their own, I am sure Microsoft could take a few key individuals from there and migrate them all over to Azure, same with the facilities and their staff.
Art departments, sound engineering departments, technical support, and game testing, all departments that are notorious for a hire-fire project cycle, well now that they are combined, Microsoft can simply build them out as the Microsoft Games <department> and move them from IP to IP franchise to franchise, none of that hires them in for Game X, fire them all after launch, hire the all-new group for Game Y, rinse and repeat.

Microsoft has not spent that money without a plan and now they can start enacting it
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Think of all the publishing and corporate roles that were duplicated. It's going to be interesting to see where the axe fell.

Duplication doesn't mean equivalency of course, dumb slashing can gut very specific and capable institutional knowledge, I'm assuming(hoping) they didn't rush this for the earnings call. MS is the worlds most valuable company right now, I'm sure they would like to maintain that position for as long as possible.

Edit: I'm pretty sure the new Blizzard game was in full development hell, it was probably headed down Titan road. MS probably wasn't terribly thrilled with that.
 
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Twisted Kidney said:
Think of all the publishing and corporate roles that were duplicated. It's going to be interesting to see where the axe fell.

Duplication doesn't mean equivalency of course, dumb slashing can gut very specific and capable institutional knowledge, I'm assuming(hoping) they didn't rush this for the earnings call. MS is the worlds most valuable company right now, I'm cure they would like to maintain that position for as long as possible.

Edit: I'm pretty sure the new Blizzard game was in full development hell, it was probably headed down Titan road. MS probably wasn't terribly thrilled with that.
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Titan was at least salvageable for Overwatch.

People’s I play with who work in or around Blizzard say it’s chaos there, lots of Managers and “leaders” have been sitting on too many fences unsure of what decisions to make resulting from all the uncertainty around the Microsoft purchase. So Microsoft wants things that Activision doesn’t so do them and the purchase falls through and they get crapped on, don’t do them and it does go through and get crapped on.
So they’ve been answering to 2 masters with different visions and priorities and the results are just bad. And bad results means time redoing work which means higher costs which means higher prices which ends up in $100 DLC expansion packs… which makes everyone mad.
 
Lakados said:
Titan was at least salvageable for Overwatch.

People’s I play with who work in or around Blizzard say it’s chaos there, lots of Managers and “leaders” have been sitting on too many fences unsure of what decisions to make resulting from all the uncertainty around the Microsoft purchase. So Microsoft wants things that Activision doesn’t so do them and the purchase falls through and they get crapped on, don’t do them and it does go through and get crapped on.
So they’ve been answering to 2 masters with different visions and priorities and the results are just bad. And bad results means time redoing work which means higher costs which means higher prices which ends up in $100 DLC expansion packs… which makes everyone mad.
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Serving two masters when one of them has no voice in the company yet would paralyze any team.

Forget the fact that Blizzard has had a very hard time making games for years now.
 
techie81 said:
Exactly, quality over quantity.
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The issue is that Activision views "quality" as titles that can extract the most amount of money through predatory micro-transactions as possible.

D4 was a game designed to get people to keep paying rather than be a "good" game. Until companies get that games designed with monetization are no longer good games and therefore will not be bought into, corporate will keep up this cycle. D4 sold faster than any Diablo game in history and it was still a "corporate disappointment" because it wasn't exploitative enough.

Meanwhile the actual mechanics of D4 are still a mess, there is no end game worth playing, the loot tables suck, the skill tree doesn't truly allow for build diversity, etc. They built the game for casuals and are wondering why the hardcore people aren't sticking around playing their game and also why the player counts just keep dropping. Only popping up slightly at the beginning of each season, but each season the people that are coming back are fewer and fewer.

Blizzard of old was about making the best quality of games they could with the longest support possible. And they weren't necessarily as interested in extracting the most amount of money possible.

The best analogy I can think of this is like cars in the 80s. Blizzard used to be built like Toyota in the 80s that were competently built. Paradoxically being of good quality also made them more money as people wanted reliable cars. But Activision corporate wants their cars to be built like Ford in the 80s, where they have obsolescence built in, require more repairs - and also paradoxically these methods of trying to extract more money mean less people buy in.

Meanwhile you have both CDPR and Larian demonstrating that if you just make a quality game (like Blizzard of old) with no BS pricing - people buy your games. And there is no excuse here either. Larian is a tiny studio in comparison with Activision-Blizzard, Microsoft, Ubisoft, or EA. Corporate in general needs to know that there is a cap to how much you can make. And infinitely increasing profits can never occur. You can fool people with "planned obsolescence" (predatory monetization) for a time. But eventually people wise up. It took 10 years or so, but now people aren't buying it.

The tl;dr is - Blizzard hasn't been producing quality games for at least 10 years. And it's all just catching up with them now. The ship could be righted, but frankly all the devs that made Blizzard, Blizzard, have left. And the emphasis on just making the highest quality of games "at any cost" is now diluted by predatory monetization.

EDIT: Spelling/grammar, not content.
 
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UnknownSouljer said:
The issue is that Activision views "quality" as titles that can extract the most amount of money through predatory micro-transactions as possible.

D4 was a game designed to get people to keep paying rather than be a "good" game. Until companies get that games designed with monetization are no longer good games and therefore will not be bought into, corporate will keep up this cycle. D4 sold faster than any Diablo game in history and it was still a "corporate disappointment" because it wasn't exploitative enough.

Meanwhile the actual mechanics of D4 are still a mess, there is no end game worth playing, the loot tables suck, the skill tree doesn't truly allow for build diversity, etc. They built the game for casuals and are wondering why the hardcore people aren't sticking around playing their game and also why the player counts just keep dropping. Only popping up slightly at the beginning of each season, but each season the people that are coming back are fewer and fewer.
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They make games?
a6qPqq9_700bwp.jpg

Blizzard of old was about making the best quality of games they could with the longest support possible. And they weren't necessarily as interested in extracting the most amount of money possible.
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Blizzard has been passed around so much that it's hard to believe they legally could keep the name. Sierra used to own them, then Havas, then Vivendi, then Activision, and now Microsoft. You really can't expect a different group of people to keep that level of quality. This is why buying up studios like Microsoft is doing is so valuable, because nobody really knows what group of people were responsible for making the games.
The best analogy I can think of this is like cars in the 80s. Blizzard used to be built like Toyota in the 80s that were competently built. Paradoxically being of good quality also made them more money as people wanted reliable cars. But Activision corporate wants their cars to be built like Ford in the 80s, where they have obsolescence built in, require more repairs - and also paradoxically these methods of trying to extract more money mean less people buy in.
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I'd argue that Ford of the 80's were actually not bad, but today's ford are really bad. I got an overdrive servo that needs a new snap ring to fix the transmission on a Ford 2012 Van, but the weather is bad and I have to wait for it be dry. Toyota today is still the best cars to get in terms of reliability. Unless you want a car that soaks the timing belt and oil pump belt in oil like Ford does?

View: https://youtu.be/0yx1-50iqnA?si=HcynuKC4qv_g8MWQ
Meanwhile you have both CDPR and Larian demonstrating that if you just make a quality game (like Blizzard of old) with no BS pricing - people buy your games. And there is no excuse here either. Larian is a tiny studio in comparison with Activision-Blizzard, Microsoft, Ubisoft, or EA. Corporate in general needs to know that there is a cap to how much you can make. And infinitely increasing profits can never occur. You can fool people with "planned obsolescence" (predatory monetization) for a time. But eventually people wise up. It took 10 years or so, but now people aren't buying it.
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I'm not a fan of CyberPunk 2077, but From Software has done a much better job making quality games.
The tl;dr is - Blizzard hasn't been producing quality games for at least 10 years. And it's all just catching up with them now. The ship could be righted, but frankly all the devs that made Blizzard, Blizzard, have left. And the emphasis on just making the highest quality of games "at any cost" is now diluted by predatory monetization.

EDIT: Spelling/grammar, not content.
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Really doubt Blizzard will change for the better in Microsoft's care. I expect World of Warcraft to get ported to Xbox, and maybe see it's subscription tied to Game Pass. Which would be a smart move since Game Pass for PC is $10 per month while WoW is $15. Microsoft hasn't been known to take other studios and have them produce gold. Look at Halo franchise and Rare. Last I remember, Rare was making shovelware Kinect games.
 
DukenukemX said:
They make games?
View attachment 630305
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LOL. Reminds me of the time when I went to Fry's with my uncle to get a laptop. They were pushing the extra warranty very hard and would not let up, making it sound like it was a life or death decision. Eventually, smart ass uncle said "Wow!. That is so good. Forget the laptop, just sell me the warranty!"
 
OK, so apparently, as of now there are people that have lost their jobs that still don't know it.

edit: Now is 2024-01-26 3pm eastern

That's disgusting, there are less awful ways to do awful things. This isn't it.
 
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Twisted Kidney said:
OK, so apparently, as of now there are people that have lost their jobs that still don't know it.

edit: Now is 2024-01-26 3pm eastern

That's disgusting, there are less awful ways to do awful things. This isn't it.
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They haven't lost their jobs yet. They will lose their job, and they'll probably be given a lot of notice before it happens.

It sucks not knowing but another day isn't the end of the world when this process has been going on for 2 years. Microsoft started their purchase of Activision Blizzard January 18, 2022.

Everyone knew the layoffs were coming, that's part of the process of acquisitions. When that happens you have a good idea if you'll end up being cut and start looking for a new job, or you stay hoping for a 6 months pay severance package.
 
Twisted Kidney said:
Edit: I'm pretty sure the new Blizzard game was in full development hell, it was probably headed down Titan road. MS probably wasn't terribly thrilled with that.
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It's funny to me that a company that has been doing this for so long, and should be very experienced at this point, still falls in the traps of this shit and wind up in development hell.

You'd think by year 32 of something, you'd more or less have a process in place for how to do it, and do it well, and a method in place for updating and refining that process with market changes, giving you a leg up. :p
 
Twisted Kidney said:
OK, so apparently, as of now there are people that have lost their jobs that still don't know it.

edit: Now is 2024-01-26 3pm eastern

That's disgusting, there are less awful ways to do awful things. This isn't it.
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At least they aren't firing people by tweet :p

Many things can go wrong during layoffs. If people find out too soon, it's bad. If people find out too late, it's bad.

It sounds to me like they want to individually meet with everyone, but are capacity constrained. That is the right thing to do when laying people off (other than the capacity constraint bit) but it does make things really unpleasant for those waiting and not knowing if they are next.

That said, in the grand scheme of things, there are a lot worse things that can happen. If the worst week you have is spending a couple of days worrying whether or not you are laid off, that's still an amazingly good life :p

People have irrational fears about layoffs. Truth is, they usually come with severance packages, and large corporations have good lawyers who can write those packages in ways such that unemployment insurance can kick in nearly right away, so that the severance package doesn't delay it.

I've been laid off three times in my career. Once during the financial crisis, once when my company was acquired, and shut down the division, and once when a clinical trial failed.

I'm not going to lie. The Financial crisis layoff was a little difficult. Hardest time in my life I have ever had finding a new job.

The other two - however - were cake. My severance packages were much longer than it took me to find a new job, meaning I had no gap in income, got double pay for two months, and my new job paid much more.

Our job market is not as crazy hot as it was a year or two ago, but it is still fairly decent, with unemployment rates below what is considered "full non-inflationary employment levels" of ~5%. I'm sure the vast majority of those laid off will not only land on their feet, but get better jobs than they had before.
 
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sharknice said:
They will lose their job, and they'll probably be given a lot of notice before it happens.
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MS is big enough that I would assume they'd have to issue a WARN notice, and I think at least 2 months' pay as severance?
 
sharknice said:
They haven't lost their jobs yet. They will lose their job, and they'll probably be given a lot of notice before it happens.

It sucks not knowing but another day isn't the end of the world when this process has been going on for 2 years. Microsoft started their purchase of Activision Blizzard January 18, 2022.

Everyone knew the layoffs were coming, that's part of the process of acquisitions. When that happens you have a good idea if you'll end up being cut and start looking for a new job, or you stay hoping for a 6 months pay severance package.
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This is very true. There are always redundancies when it comes to mergers and acquisitions. Usually not in the areas of core competencies, but often in support staff, where just because you merge two companies, doesn't mean you need two corporate finance departments, two corporate HR departments, etc. etc.

1,900 out of 17,000 is still a pretty large number to just be merger/acquisition redundancies, unless they are going very aggressively.

But it does check out. My acquaintance in the company is in software development, and has noted that his group is unaffected.

At least as much as they know :p

With the sheer quantities, I wouldn't be surprised if this is more than just redundant support staff resultant from an acquisition though.
 
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