Avalanche Studios is making headlines due to recent layoffs, primarily affecting its UK studio in Liverpool. This decision is part of a wider restructuring strategy that will also impact studios in Sweden.
Known for the Just Cause series, Avalanche had been working on a new title called Contraband, which was set to be exclusive to Xbox. Unfortunately, Microsoft decided to cancel that project in August, stating, “Active development has now stopped while we evaluate the project’s future.”
In a statement released today, Avalanche explained that these changes were necessary due to some “current challenges to our business and the industry.” They announced the Liverpool studio’s closure and mentioned that a consultation process is underway as required by UK law. Additionally, the restructuring will affect their teams in Malmö and Stockholm.
While the statement expressed a commitment to delivering great games, it notably did not address the future of Contraband. This co-op smuggling game, revealed at the Xbox and Bethesda Games Showcase in June 2021, has seen little visibility since. The official trailer has even been removed from the Avalanche site, although you can still catch it on platforms like IGN.
Avalanche is among several companies feeling the heat from recent layoffs and project cancellations within Microsoft. Earlier this year, Microsoft’s downsizing led to several other game cancellations, including major titles like Perfect Dark and Everwild.
Interestingly, despite these tough times, Microsoft CEO Satya Nadella has asserted that the company is “thriving,” attributing much of this to its shifts toward artificial intelligence and new technologies.
In a positive move, Avalanche Studios established a collective bargaining agreement with Swedish unions, aiming to become a better workplace in the gaming industry. CEO Stefanía Halldórsdóttir had emphasized the company’s commitment to improving employee experience, stating that significant steps have been taken over the years towards this goal.
This current scenario reflects a broader trend in the gaming industry, where studios are reassessing their operations and strategies to adapt to changing market conditions. As companies face increased pressure and competition, restructuring has become a common approach to ensure sustainability and innovation.
