Entire Staff Of 38 Studios And Big Huge Games Laid Off

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Today is a very sad day across the gaming industry, 38 Studios which was founded by Curt Schilling has laid off its entire workforce, including Big Huge Games, due to severe financial issues that the company has been facing recently. For a while, it looked as if 38 Studios was going to manage to save itself but alas it wasn’t to be. All 379 employees were notified of the layoffs via an internal memo that is a stark reminder of how even the best intentions can go bad very quickly. WPRI obtained a copy of that memo that you can read below.

The Company is experiencing an economic downturn. To avoid further losses and possibility of retrenchment, the Company has decided that a company wide lay off is absolutely necessary. These layoffs are non-voluntary and non-disciplinary.

This is your official notice of lay off, effective today, Thursday, May 24th, 2012.

So how did it come to this? It actually all happened very quickly. The company missed a loan payment of $1.125 million that they owed to the Rhode Island government earlier this month.  That’s tough to swallow, it gets even worse as according to Joystiq a studio closure will result in Rhode Island taxpayers possibly owing up to $122.6 million between 2013 and 2020, including interest, on the original loan of $75 million.

Rhode Island Governor Lincoln Chafee held a press conference earlier today where he explained that experts told him that Kingdoms of Amalur: Reckoning, needed to sell “in the 3 million range” in order to break even. According to studio founder Curt Schilling, Reckoning sold 1.2 million copies in its first three months of release. From there, it’s easy to do the math and see how this went bad. The governor had apparently been in contact with Schilling and its staff as recently as today and had no idea that they had laid of their entire staff, he found during his press conference when a journalist raised the issue. For 38’s part, they have still not released an official comment and at this point it’s not clear if the company is setting itself up to declare bankruptcy. In the event that the company does go under, ownership of all of 38 Studios’ IP would transfer to Rhode Island’s taxpayers.

Damn sad day and Schilling has to be commended for at least giving it a shot even if it turns out that he failed. There is an grassroot effort to help former employees of 38 Studios find new work at other game companies via the #38jobs hashtag. We hope that all the laid off employees find work quickly.

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Lorenzo Winfrey

Lorenzo Winfrey

Editor-In-Chief at ZoKnowsGaming
I am the Co-Ceo of DLT Digital Media. We are a company that is focused on developing new and innovative web properties in addition to developing WordPress based web sites for others. But before I was all that, I was a gamer.
Lorenzo Winfrey