Layoffs hit multiple Activision studios

UPDATE: Over 200 staff at Neversoft, Radical Entertainment, Luxoflux and Underground Development face the axe

Call of Duty publisher Activision is culling staff across its internal studios, with employees at Neversoft, Radical Entertainment, Luxoflux and Underground Development all facing the axe.

The publisher has blamed a decline in the music business and a shift to digital and online products for the move.

"Activision Publishing continually evaluates its resources to ensure that they are properly matched against its product slate and strategic goals. In 2010, the company’s SKU count will be smaller than in 2009 driven in part, by a decrease in the number of music-based games we will be releasing,” said the company.

"As we discussed on our earnings conference call yesterday, we are directing our resources against the largest and most profitable business segments, and as part of this initiative, we are realigning our resources to better reflect our slate and the market opportunities.

"At the same time, we are increasing our digital/online capabilities as we expect that digital/online will continue to become a more meaningful part of our business model in the years ahead."

Around 90 members of staff have been let go at Prototype developer Radical Entertainment, according to a report by Gamasutra.

Neversoft has been best known for its work on the market-leading extreme sports series baring Tony Hawk's name, but recently moved over to Guitar Hero. Radical was acquired by the company when it merged the Vivendi business and Luxoflux has mainly concentrated on licensed product such as Transformers: Revenge of the Fallen.

Underground Development, formerly Z-Axis, recently completed work on Guitar Hero: Van Halen.

Activision said yesterday that it would release one Guitar Hero and one DJ Hero game this year, despite the music genre seeing significant decline in the past year.

UPDATE: According to a report by the LA Times, as well as the 90 losses at Radical, Luxoflux will be shut down entirely at the cost of 56 positions, and 50 jobs at Neversoft have gone.

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Latest comments (12)

Bostjan Troha CEO, Zootfly12 years ago
If it helps guys:
ZootFly is hiring all positions for a Triple-A title on PS3, Xb360 and PC. Send CVs at
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Alex Wright-Manning Head of Recruitment, Splash Damage Ltd12 years ago
This has not been a good couple of months for the industry. Best of luck to anyone involved.
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Malachy O'Neill Lead Tester, Microsoft Studios12 years ago
I guess the bottom line is even if your company has posted its best earnings in its history, you aren't safe.

Edited 1 times. Last edit by Malachy O'Neill on 12th February 2010 11:24am

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Show all comments (12)
Alex Wright-Manning Head of Recruitment, Splash Damage Ltd12 years ago
Too many studios live hand to mouth I'm afraid; relying solely on the success of their current title in order to move forward with the next projects. I speak with studios everyday that are shipping staff hand over fist in order to simply survive and start again. It's a very sad state of affairs indeed.
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Private Industry 12 years ago
Hope they all find something new fast, lot`s of nice people over there.
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Fran Mulhern , Recruit3D12 years ago
"Too many studios live hand to mouth I'm afraid; relying solely on the success of their current title in order to move forward with the next projects."

But this is the way it's always been with the majority of studios. What needs to happen is simple: these studios, somehow, need to keep control of the IP they create. Only then can they get funding to help them through the bad times. Whether that's through digital downloads or whatever, it needs to happen before studios can REALLY bank their own assets. Otherwise they go through this ten-yearly cyclic of boom and bust.

I also disagree that studios are still shedding staff "hand over fist". I think the majority of studios are keeping their heads down and quietly getting on with things. Some are shedding staff, sure. But for each one who's letting people go there are eight, nine, or even ten who are still recruiting, to a greater or lesser extent.

I feel very sorry for the artists who are currently unemployed - with the rise of outsourcing, those guys are the biggest strugglers right now.
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Alan Youngblood owner/developer/artist 12 years ago
Yep, laying off the talent that made you all your money is a good idea... /sarcasm.

It won't be long before all these companies that think they are hot stuff implode on themselves. At least EA is trying to not be evil/stupid anymore.

Don't flood the market, you devalue those products. Debeers has been infamous for doing this to the competition in diamonds to drive them out of business. Bad move on their account for ethics. But it's even worse when you do it to yourself.

The best job advice is to figure out if you work for a lousy upper management right away and without telling anyone, make sure you find a job at a good small business that cares about people. Then jump ship once you have a solid offer. If the top of a company doesn't care about the bottom, it's foundation, then the whole thing will crumble on itself.

The art outsourcing is a huge issue too. I have no problem with folks in SouthEast Asia getting cool jobs like anywhere else in the world. The problem comes when they are working for managers on the other side of the globe. Also, it becomes an issue when the 'lead artist' or 'art director' positions have no one to hire because no one in their area has experience since they were too busy outsourcing. Another problem is that even though labor costs might be cheaper in say, Singapore or China, if you aren't paying your employees a fair wage where ever they are simply because some loopholes in gov't allow you to get away with it...well, you've got it coming to you. Simple rule: if you treat your workers or customers unfairly and continually rip them off, you will lose in the long run.

People in our industry need to get serious about ethics, general decency and quality of life immediately. There are no excuses, ever. Now if you couldn't do it for the intrinsic value please do it to save yourself. I have seen the future and your careless decisions do you in.
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Sandy Lobban Founder, Noise Me Up12 years ago
This is one of many cases, where unfortunately the capitalist business models use and abuse the skills of talented people when times are good, with no financial planning put in place for a rainy day when times arenít so good. Itís becoming more common place that investors in this industry are being rewarded on short term investments with no interest in long term company goals. At the skills end, people should be demanding and receiving higher payment if the freelance approach/model is indeed the way it is to beÖ
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Aidan Fitzpatrick Artist 12 years ago
It's always sad to here about this sort of thing.
As a matter of trivia, I got my own first start in the industry when the company in question had just shed lots of staff due to poor financial forecasts... only to realise later that without enough people working on content their bottom line would be hurt even more... enter a handful of fresh-faced graduates (including me).
I hope the guys at radical etc all land on their feet.
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Patrick Williams Medicine and Research 12 years ago
It is easy to see why some studios, like the ones that worked on the Guitar Hero series, would get hit if there is a decrease in demand and a lack of new projects to replace the lost ground. I'm surprised that Radical would get hit so hard , Prototype sold in the range of 2 million copies and was well reviewed.
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Andrew Clayton Executive Editor, Side Story Games12 years ago
Let's make something clear here guys, this is not the result in any flaw in the system of capitalism. The purpose of capitalism is to reward people based on what they earn. If there is a question of greed, the system is not to blame, the individual is.

That being said, outsourcing is not necessarily a death knell for the industry in modern countries. Companies see a recessionary period and are trying to stay afloat in potentially dangerous waters. They are simply trying to curb their risk by cutting down on their costs. Outsourcing is not a matter of greed, it's a matter of trying to keep what we work so desperately to earn.

Yet there's a reason why I, as a businessman, would not outsource jobs such as art design or programming. I have no doubt that there are great artists in Asia who would be willing to do the same job for half the price. However, I (and the truly great companies in the world) do not expect the same job from my employees, I expect an extraordinary job from my employees. I know that the money I would save from reduced costs by outsourcing my art or programming work is nothing compared to the profits I would make from developing a truly outstanding game.

The talent required to create such a game only comes from countries who train their employees to want the best and to be the best. I want employees who aren't just able to understand what I want, but to put their own personal touches on it that would take the game from merely "good" to "epic". That kind of talent is almost exclusively seen in "westernized countries" such as the ones you are all working in today.

The layoffs you see now will either make or break these companies. EA and Activision are either going to be guided by good leadership willing to tighten their financial belts while still producing good games, or release those who have kept them afloat for so many years and, in the process, sink like a rock. Unfortunately, for many divisions of Activision I am concerned that this is the latter. The development of cheap sequels such as "Guitar Hero: Van Halen" is just another sad sign that companies have begun to look toward Disney for their business model rather than companies like Valve.
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Fran Mulhern , Recruit3D12 years ago
No offence Andrew, but your first paragraph makes you sound like an ideologue, and they're never good.

Firstly, the simple fact is that a lot of art roles HAVE been outsourced. So you can write that it won't happen, but it IS happening. You can write that it shouldn't happen, but it is happening. You can write that you wouldn't do it, but it is happening.

Secondly, to say that non-western artists, whilst good, don't have the *wow* factor of western artists... is bemusing, to say the least. I've seen some awesome work from Asian artists. Not all western artists are brilliant, and not all asian artists are average.

Thirdly, not all games can be outstanding. It's a sliding scale - some are outstanding, more are very good, even more are average, quite a few are bad, and some are truly awful. And for the majority of those games, outsourcing will work - even with non-western artists who will, apparently, never be quite as good as the best westerners. Not all games need to be brilliant. And not all games can be.

Your second paragraph implies that studios will cut down on outsourcing when the industry recovers ("Companies see a recessionary period and are trying to stay afloat in potentially dangerous waters"). Do you really think that? when the economy picks up, will studios really take work away from the cheaper, more up-to-date eastern studios and bring it "back west", especially when a fair number of artists here will have been out of work for a substantial period? I suspect it's more likely they'll keep the work where it is and simply use the revenue saved either to invest in the business or, possibly, pay it back to shareholders in the form of increased dividends. And to be fair, who wouldn't? If you can source your raw materials from halfway across the world and they're perfectly good for your product, then you're not going to change back to the locally produced stuff that's twice as expensive to get in. I'm not sure capitalism has a purpose in the way you seem to think (that's a whole discussion in itself), but it DOES involve a trade off between quality and price. Do you want to sell a state of the art $100k car that costs $90k to make, or a $50k car that costs $20k to make?

Don't get me wrong, I'm not a big fan of outsourcing. And it's purely selfish - I've got too many friends in the industry (as well as my wife) who have seen their art based jobs disappear as work gets shipped overseas, and personally I'd rather people here have work so they can contribute to the economy, rather than publisher money being ploughed into overseas economies. But that aside, I can accept that studios will do it, and that they'll do it because it can work for them.

But I don't think you can somehow say it's not happening when it obviously is.

I like how you seem to equate yourself with "the truly great companies in the world", btw.
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