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The Irrational decision

The Irrational decision

Wed 19 Feb 2014 8:47pm GMT / 3:47pm EST / 12:47pm PST
BusinessPeopleDevelopment

Does the shutdown of Irrational Games make sense? [UPDATE: Take-Two has finally issued a statement]

Update: Following our publication of this piece, GamesIndustry International has now received a new statement from Take-Two: ďWe've enjoyed a long and productive working relationship with Ken and are thrilled that he is pursuing his new creative endeavor with Take-Two. Given Ken's plans for this exciting new project, Take-Two determined that the best approach for the remaining Irrational Games staff would be to find internal career opportunities for as many as possible, and to provide placement assistance to those who would be leaving our Company.Ē

Original story:

The news that Irrational Games is closing struck gamers and the game industry like a bombshell yesterday. The studio's founder Ken Levine announced the closure in a post on the company's web site, explaining that he's moving in a new direction and as a consequence Irrational Games is closing down. The two main responses have been a fear this means no more BioShock games or content in the future, and outrage at the loss of more than 100 jobs at Irrational Games, as reported by The Boston Globe (note: Take-Two isn't confirming a number). What's really going on?

Take-Two, when reached for comment, said merely "We're not commenting beyond Ken's posted statement." At some point, perhaps, we'll hear more details from Ken Levine and from Take-Two. There's plenty of information contained in Ken Levine's statement for us to draw some conclusions, though.

First of all, it's important to be clear about authority and responsibility. While Ken Levine founded Irrational Games in 1997 along with fellow Looking Glass alums Jonathan Chey and Robert Ferrier, Take-Two bought the company in 2006. Ken Levine has been the public face of Irrational Games, and has been running the studio, but it's not his company anymore. Take-Two is in charge, and bears the ultimate authority and responsibility for a decision to close the studio.

Ken Levine's decision isn't that hard to understand when you look at the key part of what he said - he's looking to create something that will take a very long period of design. If you're going to be spending months, or perhaps even years, working on fundamental design issues, it doesn't make sense to keep a large staff around with nothing to do until you've reached the right stage in your design. It's better to give that staff the best chance to find a good job somewhere else rather than keeping them without something productive to do for an indeterminate period of time.

"Performing a heart transplant on a game studio is rarely successful. It may be that Take-Two just doesn't believe Irrational Games could really replace those employees who are leaving and still be the same great studio in the future"

It's not clear why Take-Two isn't just forming a group from Irrational staffers to produce more BioShock content going forward, but perhaps this is a signal that Take-Two doesn't see a lot of DLC ahead for the BioShock franchise. New games could certainly be built, but Take-Two doesn't seem to be committing to that right now, which is puzzling. If there's not a strong case for a new BioShock game, surely there are some other projects that these talented people could be put onto, as Take-Two works to put new and existing franchises on next-gen consoles. Finding good people is difficult, and Take-Two should be keeping as many as it can. The publisher's obviously had time to think about this, and its rather weak response to the situation seems like a poor choice.

However, we don't know enough of the underlying facts to really decide how reasonable a studio shutdown is from Take-Two's perspective. Maybe the staffing wouldn't be supported by the projected sales of BioShock DLC that's planned, or a new BioShock title is not planned. There's also the issue of replacing the 15 staffers that are leaving with Levine. It seems logical to assume that these would be key personnel, the ones most difficult to replace. These employees may well be the key drivers behind the studio's creativity and ability to get great products made, and performing a heart transplant on a game studio is rarely successful. It may be that Take-Two just doesn't believe Irrational Games could really replace those employees who are leaving and still be the same great studio in the future.

On the other side of it is Levine's decision to try something new. Apparently he was ready to leave Take-Two and form a new company, but Take-Two convinced him to create a startup inside of the company. Why is a new studio needed? For one thing, Levine is tackling a difficult problem - "narrative-driven games for the core gamer that are highly replayable" - that may not have a best-selling answer. It may take years to get to a game created from a standing start. We don't even know what platform Levine is aiming at, although he gives a broad hint when he says they will "focus exclusively on content delivered digitally." Whether it's on PC or console or mobile, going exclusively digital means a game can change more swiftly. More content can be delivered quickly, and a design can change based on customer feedback. Levine will need an entirely different company organizationally to pull this off, as well as a variety of skills that may or may not be present amongst a staff built around creating disc-based console content.

Levine's decision to start over without most of the Irrational Games staff makes sense given his goals. He's obliged to follow his muse, not to keep cranking out the same type of game again and again. While no one likes to see people put out of work, the manner in which that is carried out matters a great deal. If Levine and Take-Two can make the transition a smooth one for staffers, that will rebound to their credit. From what Levine says in his posting, and from what we've observed of his Twitter feed, he's trying hard to find positions for everyone wherever he can.

Take-Two would seem to have the capability to offer those staffers roles at other studios, especially with the company looking to launch new IPs and bring its current slate of games to next-generation consoles. With all of the cash rolling in from GTA V, Take-Two could form a new studio around the remaining Irrational staffers and hand them something to work on, couldn't they? The company's seeming reticence about the fate of Irrational staffers is, at the least, a bad PR move. Long term, the best investment a game company can make is in quality employees with demonstrated skills, and Take-Two shouldn't just let that asset wander away.

Levine is going to forge a new studio and a new game, leaving most of Irrational Games behind for Take-Two to deal with. Hopefully there will be enough time granted to Irrational staffers to be able to land good positions elsewhere, whether at Take-Two or with other companies. Both Levine and Take-Two should recognize the long-term benefits of managing this change as gracefully as possible.

19 Comments

Steve Wetz
Reviewer/Assistant Editor

98 132 1.3
The decision not to form a studio (or, dare I say it, leave Irrational as is without Levine) is incredibly puzzling. This is a studio staffed with people that created a beautiful game, a game that all but made (in my opinion) the "games as art" debate moot. I know Levine wasn't creating those beautiful art assets. So we take a group of seasoned, successful individuals and hand them the pink slip? Very strange, Take-Two.

I have two therories: 1) There is something going on which has not yet come to light which made the determination to keep the rest of Irrational Games less than favorable. 2) Expect an announcement from former Irrational employees starting their own company shortly. There's no reason for them not to. They have proven success and a cohesive group of skilled professionals who all know one another. Any investor (barring some revelation from theory 1) should be happy to throw some money their way.

Posted:A month ago

#1

Caleb Hale
Journalist

144 209 1.5
Given a game publisher's general attitude toward a development studio seems to be, "What have you done for me lately?", I'd say it's more likely 2K was willing to pay 15 people to explore opportunities for the next year and a half, not more than 100.

Posted:A month ago

#2

Klaus Preisinger
Freelance Writing

953 804 0.8
So in essence Take 2 acknowledges that they cannot tell Ken Levine what to do, but they sure as hell can pull his funding. That's definitely the first step down the road towards somebody referring to himself as "the person formerly known as Ken Levine", while stamping unpronounceable symbols on everything to spite radio promoters.

Posted:A month ago

#3

Tuomas Pirinen
Head of Design

4 6 1.5
There is also a simple possibility that Irrational was not a proftable Studio or even if it was, it did not meet its sales expectations. If Bioshock Infinite did ot recoup its development and marketing budget then this action is sadly logical. Take Two never celebrated the sales of BI unlike their other hit games, and that is usually a worrying sign. Perhaps we will learn more soon.

Posted:A month ago

#4

Alfonso Sexto
Lead Tester

714 495 0.7
Seems a persona change of heart in general. First thing that comes to my mind is calling this guy irresponsible for leaving so many people unemployed because of a personal wish. But... although I really believe there is some responsibility in there, I'm not sure what I would have done if I were him.

Best of luck to everyone affected by this and looking forward to hear news about any new project by Ken.

Posted:A month ago

#5

Andreas Gschwari
Senior Games Designer

542 528 1.0
Popular Comment
Has anyone actually taken the time to try and get staff from Irrational to talk about their experience and the closure? The only thing that is puzzling to me is the media's focus on Levine and Take Two. Sure the redundancies are mentioned, but has anyone actually talked to the staff and get them to share how they feel, what their experiences were working on Bioshock?

Posted:A month ago

#6

Dan Tubb
Investment manager

22 105 4.8
Popular Comment
With 100 people, assuming fairly average overhead costs you could be looking at monthly cash burn of somewhere around $800,000+, thatís an almighty cost to justify if most of those people are not being used. If what Ken is planning really is going to be years away from development (at any scale anyway) then could be as simple as just not being viable to have 100 people underemployed for years, both in the sense of funding it and for the people themselves whose skills and CV would stagnate.

My first reaction was surprise in Kenís slightly arrogant implied assumption that without him and his best 15 guys there is no viable studio left to apply to other projects, and thus shutting it all down rather than him sourcing a replacement and then leaving. But then again he might be right. To be honest of the small businesses I have been involved in if you took away the boss and their 15 best, and then I canít think of any that would still be really viable. Of course I feel badly for those losing their job, and hope they truly get great support, but there does not necessary need to be anything mysterious going on here.

Posted:A month ago

#7

Iain Stanford
Experienced Software Engineer

26 82 3.2
I imagine the fact that BioShock Infinite was in a somewhat troubled development of nearly 6-7 years, and sold in the region of 3.5 to 4m copies (with rumours of upwards of $200m budget...but I imagine thats a bit over estimated).

Then I think the fact that Irrational just weren't pulling in enough revenue is the real reason.

If you go with production lengths and budgets in the GTA, COD, Skyrim style regions, you need to pull in their sales figures too.

Posted:A month ago

#8
recreating the critical monetary success of Bioshock was going to always be a tough ask.

Posted:A month ago

#9

Tom Keresztes
Programmer

632 223 0.4
But then again he might be right. To be honest of the small businesses I have been involved in if you took away the boss and their 15 best, and then I canít think of any that would still be really viable
Key people. If they are removed, the team breaks - they might organize themselves, but they no longer have a direction to follow. Its very easy to hire smart people if you have the money, much harder to build an efficient team.

Posted:A month ago

#10

eoghan dalton
Creative Director & Co-founder

1 0 0.0
Is this just a nicer way of saying restructuring? Key team, same publisher, different strategy. Both involve significant shedding of jobs, in turbulent times.

Posted:A month ago

#11

Tim Carter
Designer - Writer - Producer

535 221 0.4
It doesn't make ANY sense to run a studio after production is over.

I still can't understand the stupidity of the game industry, vis-a-vis this.

You want to make great games, but you also want job stability. Which is it?

If you want job stability, you want to work in a factory. Factories churn out sh*t.

If you want to make great games, follow the arts industry. That's the project-based business model. Each project is it's own company and gets shut down after production.

Posted:A month ago

#12

Alejandro Diaz
Lead Programmer

1 0 0.0
What I want to know is who OWNS Levine's new studio? All I've heard is that Take-Two is funding it, but I have not heard definitive word about ownership. If it is indeed a new corporation owned by Levine, and I assume some of his founding team, then that makes sense why they would leave and let the rest of the team face their own fate. Levine and the founders get equity in a new company while getting funding from Take-Two. Sounds like a pretty sweet deal, except of course for those who got left behind...

Posted:A month ago

#13

Felix Leyendecker
Senior 3D Artist

184 196 1.1
@Tim
This is a super short-sighted attitude. It takes a lot of time for team chemistry to mature, and for people to become knowledgeable in their roles, not to mention them finding their specialist niches. Firing the team after a title is shipped means you have to start over from scratch. Depending on the complexity of the product, it will be more expensive than keeping them around. Do you see any of the top tier studios showing everyone the door after a title is out?
This is one thing that f2p studios will have am easier time with. You don't rush a project to market and then be done with it, it needs a steady stream of content for years after it ships, while a core team can work on a new game or sequel. If anything, this is a problem for studios with a heavy focus on SP boxed titles, that also can't stick to a schedule.

Posted:A month ago

#14

Tim Ogul
Illustrator

272 325 1.2
I just realized why everyone is losing their #### over this announcement. It's because this was HONEST. Usually studios just lie about it. This has happened dozens of times over the years, the core intellectual assets of a studio pick up their ball and go elsewhere, forming a new studio where they work on new projects (or sometimes just retiring), the difference being that the publisher typically keeps the studio's name on the door. They leave this zombie creature shambling around, perhaps churning out mediocre simulacra of the original product, but everyone who actually pays attention knows that the magic is gone.

Now I don't mind if they put together a new studio to work on new games using the Bioshock IP, there's plenty to be mined there, but at least this way we'll be fully aware that this is being made by someone completely new, maybe even for the better.

Posted:A month ago

#15

Iain Stanford
Experienced Software Engineer

26 82 3.2
Actually Tim, I think people are losing their "####" because it in fact **doesn't** seem honest.

If they just came out and said, "BioShock Infinite didn't meet expectations" or "BioShock cost too much" or that the series is just no longer seen as profitable, so they are closing the studio down to work on something new. Then that would come across more honest.

Going with the "This is totally just creative, we want to get back to our 'roots', try something new". Well the deserved reaction is, "Why on earth weren't you doing that WHILE finishing off BioShock, so you would now have something for all those people to work on instead of making them all redundant".

This feels like just a "normal" studio closure, with their attempt to sugar coat it with this new "Levine wants to get all creative again" to please the fans.

This feels less honest.

Edited 1 times. Last edit by Iain Stanford on 21st February 2014 9:55am

Posted:A month ago

#16

Tim Ogul
Illustrator

272 325 1.2
If they just came out and said, "BioShock Infinite didn't meet expectations" or "BioShock cost too much" or that the series is just no longer seen as profitable, so they are closing the studio down to work on something new. Then that would come across more honest.
I've seen no evidence that the reasons they gave aren't the honest ones. You may speculate that the studio wasn't profitable enough, and maybe that's true, but I'm no conspiracy nut and until there's a basis for that claim I see no reason to entertain it.
Going with the "This is totally just creative, we want to get back to our 'roots', try something new". Well the deserved reaction is, "Why on earth weren't you doing that WHILE finishing off BioShock, so you would now have something for all those people to work on instead of making them all redundant".
And the answer is that if you've ever read a Ken Levine interview, you'd know that he comes off as being obsessive and fully integrated in the task at hand. He at least claims to have been hands-on with every aspect of the game, I could see him hovering over people's shoulders all over the office. I can't imagine that guy working on any other projects when there's Bioshocks left unfinished.

I have no difficulty believing that he and his core group of creatives were spending all their time polishing the Bioshock game and DLC packages prior to their release, leaving very little time to get anything done on the new IP. The studios that can manage to roll from one project to the next without skipping a beat tend to be the "churn factories" like Ubi's AC factories, or the sports games, where all they do is tweak the previous offering. I can't recall a studio where a single team rolled from one IP to a completely new IP without significant staff flux.
This feels like just a "normal" studio closure, with their attempt to sugar coat it with this new "Levine wants to get all creative again" to please the fans.
If they wanted to close the studio, they could just close the studio, Levine included. There'd be no reason for them to keep Levine on board if they didn't feel he had a new project in his future, and if he did have a new project that was ready to roll, then that's what they would be working on. Plenty of high profile creators have been outright fired or left their original publishers before, it says a lot about the faith 2K have in him that they wanted to retain him under their umbrella.
This feels less honest.
Only if you can find some evidence to substantiate your theories.

Posted:A month ago

#17

Iain Stanford
Experienced Software Engineer

26 82 3.2
Well, judging by the figures on VGChartz a conservative estimate on sales for BioShock Infinite put it at around 3.5m copies in total.

This is also pretty much the same as BioShock 2.

Of course BioShock 2 has been out longer, but Infinite had a considerably longer dev period (around 6 years wasn't it?) and there are plenty rumours putting the budget in the $150m-$200m. It was an expensive game, and sure it gained critical acclaim, but the sales figures just weren't outstanding enough. In terms of investment, Infinite hasn't performed as well as BioShock 2 depending how you look at it.

Regardless. If they literally had nothing else in the works, and need to fire virtually *everyone* reducing down to just 15. Thats some pretty spectacularly bad management, and having people pat them on their backs for being "honest" and reward them for going against the grain to get back to their "creative" roots I think is underserved. A properly managed studio of their scale should be able to work on more than 1 thing at a time. This new creative vision should have been started while Infinite was wrapping up. Then the Infinite team work on DLC while the new creative vision is fleshed out, ready for them to shift to that on completion (with some, but minimal redundancies to get an appropriate team size).

People claiming this is "normal", that in this industry its expected to do this after a project, I'm sorry but no. Reducing a studio from hundreds to just 15 is seen much more as a closure, most studios might reduce their numbers after a project yes. But not nearly 80%+ of their staff!

If this is truly needed, that was some very short sighted management, and they need to be called out on it so they don't repeat themselves.

Posted:A month ago

#18

Tim Ogul
Illustrator

272 325 1.2
Of course BioShock 2 has been out longer, but Infinite had a considerably longer dev period (around 6 years wasn't it?) and there are plenty rumours putting the budget in the $150m-$200m. It was an expensive game, and sure it gained critical acclaim, but the sales figures just weren't outstanding enough. In terms of investment, Infinite hasn't performed as well as BioShock 2 depending how you look at it.
Maybe so, but it's speculative to assume that 2K had a problem with them to the point that they would implode the studio, without cutting any of the core decision makers at the studio. If your theory were true, it would be far more likely for them to fire, or at least sever Levine and his core group, since they would have been the ones responsible for the decisions that lead to the costs, while retaining the name for marketing purposes and the grunt staffers to work on new projects, and just shoehorn some new bosses in who would be more reliable in sticking to the bottom line. They seem to have done the opposite.
Regardless. If they literally had nothing else in the works, and need to fire virtually *everyone* reducing down to just 15. Thats some pretty spectacularly bad management,
Again, that really depends on what their goal was. If their goal was to make a studio that could roll seamlessly from project to project for decades at a time, then clearly they failed in spectacular fashion. If, on the other hand, their goal was to make the Bioshock Infinite project as good as it could be, and then move on to some other project that will hopefully be great to, then there's nothing wrong with the way they did this. They are under no obligation to keep anyone employed for longer than they have need of them. All I would expect of them in that regard is that they were up front about the future of the company with the employees, and that they do their very best to hook these guys up with future employment opportunities.
A properly managed studio of their scale should be able to work on more than 1 thing at a time.
Again, depends on the management style of the boss. Read some interviews with upper tier devs sometime. Some of them are great at managing a ton of projects at once, some are hands-on and highly invested in a single project. I don't fault either so long as the games they actually produce are great. I read a recent interview of Brad McQuaid from Everquest where he noted that he "pulled a Levine" while working at EQ because he just felt too out of touch with the guts of game making, and formed his own smaller new company to develop new games. The only difference there is that EQ was churning out so much money at the time that Sony felt fine about replacing him with someone else to keep it flowing.
People claiming this is "normal", that in this industry its expected to do this after a project, I'm sorry but no. Reducing a studio from hundreds to just 15 is seen much more as a closure, most studios might reduce their numbers after a project yes. But not nearly 80%+ of their staff!
It happens more often than you might think, but again in many cases it's just a matter of that core 15 leaving and doing their own thing, with the Publisher keeping the rest of studio running on autopilot. Really it's the brain of the studio that left, the studio is nothing like what it once was, and yet for those not paying attention it's "still around." That's why I find it more honest that they just went "Ken Levine IS Irrational Games, Ken Levine is leaving for other projects, there is no more Irrational Games." Honest.
If this is truly needed, that was some very short sighted management, and they need to be called out on it so they don't repeat themselves.
They should repeat themselves, as often as necessary, if it results in good games.

Posted:A month ago

#19

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