Internal studios are more expensive than hiring external teams, says Jason Kingsley, CEO of Rebellion, adding that larger publishers are now starting to realise the costs associated with in-house development.
Kingsley told GamesIndustry.biz that companies often start an internal team as an alternative to hiring an independent studio, when "the truth is the exact opposite". Yesterday, Microsoft announced that it is closing Ensemble Studios following completion of the Halo Wars project.
"Internal teams are at times seen as a cheaper alternative than using an external resource," Kingsley explained, "but the truth is the exact opposite as far as I'm concerned, and big companies shedding internal teams might be an indication that the penny has dropped in their accounts departments."
His comments come as GamesIndustry.biz broke the news that NCsoft Europe is planning to cut staff at its Brighton office.
"I think that perhaps the big spike in closure rates is down to natural business cycles as much as anything, though I suspect a certain natural movement of development focus to advantageous tax regimes as well," Kingsley commented.