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Silicon Knights confirms layoffs

Canadian developer cuts workforce following cancelled project

UPDATE

Too Human developer Silicon Knights has confirmed it has drastically cut headcount, letting 45 members of staff go.

The Canadian developer blamed a cancelled project for the redundancies, which it said had been shelved "at the final second."

"We just finished a project with [Activision Blizzard] that got completed," Mike Mayes, CFO, told The Financial Post.

"We had another project lined up that had been in the works for months, which had been green-lit and at the final second, at the high corporate level, the project got cancelled. We don't know why. Probably something to do with the publisher on their side, but that resulted in us having too many people so we had to do a layoff."

Yesterday unconfirmed reports suggested that up to 75 members of staff had been let go at the studio.

Original story

Canadian developer Silicon Knights has laid off 75 per cent of staff, according to a new report.

Two separate sources have told 1UP that only 25 staff remain at the Too Human developer, which most recently completed work on X-Men: Destiny for publisher Activision.

The company has received multiple handouts from the local government in the region, and most recently secured CAD $3 million in funding to kick off a self-publishing drive and recruit a further 80 members of staff.

GamesIndustry.biz has contacted Silicon Knights for further comment.

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Latest comments (30)

Harrison Smith Studying Games and Graphics Programming, Royal Melbourne Institute of Technology5 years ago
Someone is taking those grants and running, I think the Canadian government should get onto who ever is at Silicon knights and find that money before its gone. I have a feeling that its probably in a Swiss or Bermuda bank account by now.
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sounds suspekt doesnt it!
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Martyn Brown Managing Director, Insight For Hire5 years ago
Thats 1.5m, how quickly do you think that got burned through with all those staff, plus studio costs? If anyone has run anyway with anything, it's more likely debt. With 100+ staff, that $3m CAD wouldn't last long enough to support the studio's likely downtime between projects.Right now is not a great time to have a massive, expensive console team in a quickly transitioning industry - even in Canada and the land of the grants and tax-comforts.
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Show all comments (30)
Small is beautiful indeed. With a 20 sized team + outsourcing, I'm sure a good product could have been had..but sufficient to produce new IP between developments
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Support Martyn's comment above here. Some publishers expect you to have a massive production machinery ready, whilst doing a cost-effective pre-production. Such efforts drains the working capital reserves.

The utopia of a small core unit + outsourcing is still not there (as in functional) yet. If it were, you'd have people yelling on 'abusing' contractors and temporary project members vs. permanent staff.
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Nick McCrea Gentleman, Pocket Starship5 years ago
RTW got a $21m investment in Jan 2010, and was bust by August, with several million dollars of debt. Granted, we nearly 300 strong by then and were all sitting around on golden thrones and sleeping in duvets lined by $100 bills, but it goes to show how expensive running a big studio can be.
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One wonders what the projected burn through rate per month is for EA, Ubisoft and Square in Canada....
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Tommy Thompson Studying Artificial Intelligence (PhD), University of Strathclyde5 years ago
Then again, you also have to consider the success of recent releases and how revenue will counter their recent government grants. Too Human didn't perform well, and by the looks of things neither will X-Men: Destiny. Do they have anything else in their portfolio?
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Phil Elliott Project Lead, Collective; Head of Community (London), Square Enix5 years ago
Best of luck to all those affected.
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Pete Leonard , Amiqus5 years ago
Silicon Knights up until recently had a good reputation fro developing solid titles that were critically acclaimed. Eternal Darkness and The MGS remake were considered pretty decent. Too human is what has effectively put them back a few steps and they don't seem to have found their stride again.

That team was getting on for 150 people at it's peak before Too Human came out and they made some redundancies after that. You burn through that kind of money in less than 2 months with that sized team.

Question is - how much money/publisher support did they get from MGS and Activision and how much was self suported for this new project? It could be that something is amiss or it could also be another example of the current generation bleeding you dry if you don't get 2+ million sales.

Been a difficult generation to develop for due to these costs. High end AAA XBLAPSN games are the future for a lot of developers I think - Chair sure did well out of it (and that was before Epic bought them), and Housemarque in Finland have done well with Super stardust and Outland.

I would be very interested to know how Crysis is selling now that it is available for download....

Best of luck to all those that lost their jobs. It's a shame - I loved their earlier titles - I still remember thinking my gamecube ate my ED save game:)
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Lee Burton Studying BSc Games Development, Southampton Solent University5 years ago
I like the fact that no-one has forgotten about that grant money, I'm not sure Silicon Knights like that though.

I wish the best to all the affected staff. I'm certain they'll find similar jobs soon enough.
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Alan Wilson Vice President, Tripwire Interactive5 years ago
VERY rough math usually allows up to $10K per employee per month, which puts their monthly burn rate at something like $1m per month, so it doesn't take long to burn through $3m. On the other hand, if that $3m was just to kick-start self-publishing, then someone should have done a little more due diligence. We bought the IP for Killing Floor, finished the development, self-published the game digitally and in stores globally for less than $3m all up - and we've sold approaching 1m units on PC. Never mind the prior $4m I see they got from the government...

And weren't these the guys trying to sue Epic a while back, or is my memory astray again?
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Thomas Luecking5 years ago
This comes at no surprise for everybody who can do the math... a shame for all the highly skilled people, especially (for me as an outsider) as this seems to be a result of poor project management and underdeveloped business skills...
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In my own personal opinion.....

65% metacritic review score for too human, isnt going to translate into big sales and pay the bills unfortunately. I would say its more to do with that than any wrong doing with government grants.

Good luck to everyone affected.

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Most likely because of how lame X-Men Destiny ended up being. Very little original thought on that one and sub 50s on Metacritic. They deserve to be dismantled and let the creative go on to better things I think. Maybe the CA gov needs to start putting clauses in their grants "If you are not doing what the money was earmarked for in a year, we're coming to repossess everything" heh.
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Wait till the CA govt becomes like Italy :)
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Patrick Frost QA Project Monitor 5 years ago
Silicon Knights have been a high risk style business for a long time. They spend years upon years developing just one game at a time with the hope that it will pay off.

You can't work a business with such an unpredictable market. Even good games sell badly, they should know that.... they made Eternal Darkness.
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Ian Brown IT Developer / IT Infrastructure 5 years ago
Well my best go to those who are now unemployed and hope they find new work soon.
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Those laid off: you're talented people, start your own company, regional and national level should get you some grants for starters.
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Martyn, John, glad you came in with those comments. Too many people do not understand how much it costs to run a studio these days and the between project cash burn is huge. And yes publishers expect a full team there when they start but wont commit for months. So the model of keeping the core team always and building a team for the production phase is in reality the way to go because that allows you to preserve profitability and therefore long term jobs and stability. Sucks for the affected people though but unfortunately without a 'sugar daddy' is the way a sensible business has to run.
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Tim Carter Designer - Writer - Producer 5 years ago
Now they are all stuck out in St Catherines. What good is that?

If they lived in Toronto, say, some could seriouslycontemplate starting up a new studio in Toronto, or working for another company (if more were to cluster in Toronto).

Southern Ontario needs to get its act together. Either it wants a serious game indsutry or not. If it does, it needs to move in to Toronto.
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Thanks Mark, glad to see you share a similar view.

To various; I don't think Silicon Knights are 'stupid'. They've outlived the average lifespan of most studios already. What's really a shame is that the industry has yet to find a liveable mechanic between professional, dynamic contractors and permanent staff. Movies (not further comparisons please..) did this half a century ago.
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The movie model is NO way a feasible way to make a game product work. its pretty inhumane as well.
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Dr. Chee Ming Wong: Whether it's inhumane it's eye of the beholder I guess... A mid-range production resource will invoice 30k for 2-3 months work on a focused movie production, ready to move on to the next project or even have couple of weeks holiday (god forbid)... On a game many will slowly 'sweat' ditto a year as employees - many times through ineffective waiting caused through crunch.

I'm not saying there would be a massive difference on total money spent, but the mood of the project and the spirit of its resources is very different between the two alternatives...
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Fyzard Brown Sales Associate, VideoGameAdvantage5 years ago
They still owe MS two more Too Human games
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Andrew Goodchild Studying development, Train2Game5 years ago
I'm not sure MS are too bothered, based on the reception of the first.

I'm confused, they got a grant to help to move to self publishing, but have to make layoffs due to a work for hire cancellation. I'm guessing the self publishing isn't far along?
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I think they dont have the goods for self publishing yet. Looks like its still work for hire or hire us to produce our own work that we think will be awesome. its a high risk gamble indeed
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Liam Stockley Studying Computer Science, Nottingham Trent University5 years ago
What on Earth were they doing with such a high number of staff in the first place?! They haven't put out a truly commercially successful game in YEARS, and with their long development cycles... I just don't even know...
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Neil Alphonso Lead Designer, Splash Damage Ltd5 years ago
Agreed Andreas, I think a 65% MC is quite harsh on Too Human... but that often happens with games that try to be different, and doubly so for those that have a highly publicized and troubled development time.

Alan, as far as I know the Epic litigation is still alive.
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Legal - its one sure way to have too much baggage for game companies...
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