It is worth understanding that this is “different” than… all the other layoffs in tech at this point.
MS acquired ABK. Any acquisition almost always leads to “downsizing”. At a high level: ABK would have had their own payroll department. Now they go through MS payroll. Why do you need an entire department whose job is now superfluous? Obviously this gets a LOT more complex with developers and the like (as well as local management) but that is the mindset.
But… holy fucking shit that is a lot of people getting laid off at one of the worst times to be unemployed in “tech” in the past decade.
It is indeed a lot of people. A quick search says ABK employed 17,000 people. Laying over over 10% of your workforce is… intense, to say the least. Though, how much of that 1,900 is just from ABK is hard to say, so the percentage could be lower.
You’re right though; HR, payroll, legal, and social media/PR departments would definitely be among the first on the chopping block, depending on how much MS wants to integrate ABK into their existing departments.
Also considering the apparent toxicity of certain Blizzard employees it’s probably a good opportunity to “purge” the Kotic gang and his following.
So that’s a dozen people. 1900 is more than a hundred times that. (#mathFTW)
These cuts will seriously hurt product.
Also, I sense my less-than-new windows version will be unsupported; and I only had it so the one game ran better.
In this case, it kills unproductive jobs. Payroll people are necessary but at the end of the day, they don’t produce anything you would want to buy. This means that if you keep more administrative jobds than you need, there will be fewer actuall things to go around. Hence everyone will be poorer on average (or realistically speaking, the rich will be poorer in the current system, but that is a different issue).
Anyway, keeping unproductive jobds to reduce unenployment is a dumb idea and is one of the main reason why communism sucked so much.
I have a better idea. Fire the whole payroll division and hire just one accountant. Since clearly, clearly, any number of payroll employees can sustain any company size, this is the most cost efficient way to go.
Oh you say one staff in payroll is not enough? Oh then I miss your point.
Similar to 2008 but the 1% found out a way to keep their wealth intact while still fucking everyone else over.
There should be some sort of law that hits exec’s options, RSUs and bonuses if their financial for a business division aren’t total trash. Example, eBay, which grew and still laid people off.
That said, this one I kind of get. Mergers and acquisitions create literal redundancies. You end up with duplicates of people and departments.
Yeah, I’m a bit skeptical that this is just about “downsizing” or eliminating redundant positions after the acquisition. Based on what I’ve seen on Twitter, a lot of junior, middle, and senior level positions were victims of these cuts, across a ton of different departments. Animators, artists, developers, no one was safe. Apparently like the entire Overwatch lore team was cut - you can’t tell me that team has any overlap whatsoever with any existing Microsoft employees.
That gets into the mess of what the reality of “gaming” is. Most people will acknowledge that Call of Duty and… uhm… Halo? Sure, let’s go with that. CoD and Halo compete. They are both games in a similar genre. Same with the hilarity of Horizon Zero Dawn meaning that a critically acclaimed open world game is coming out.
But the reality is that CoD and Fortnite compete with Squid Game and Reacher. Breath of the Wild competes with both Elden Ring AND The World Cup. The resource is increasingly time. When people get home from work they generally aren’t saying “I am going to play three hours of video games and it will either be Battlebit or CoD”. They are saying “I have three hours so maybe I’ll watch an episode or two of Demon Slayer or I could do my dailies in Fifa?”
And, in that regard, Overwatch is an increasingly “failed” live service game with an IP that has lots almost all of its good will. Whereas Halo… Master Chief had a sweet ass? But Overwatch DOES compete with the other big live game that MS acquired alongside them… Call of Duty. And so forth.
Its all a giant mess where labor suffers. But… yeah.
I never want to hear “job creators” as a reason for tax breaks and special treatment again.
You’re going to hear so much more of it now that we’re cranking the unemployment rate back up again.
68 billion to acquire IP, but can’t afford to pay the people who make and maintain it.
Well, yeah.
The shareholders demanded a sacrifice. You really think any of the top brass would be affected?
They literally do 1000 times the work the devs do to justify the millions in pay and compensation, and the whole place would grind to a halt if they were affected (/s if you believe that)
Layoffs after this size of merger are pretty typical. The number of people seems high, but it might be due to Activision’s own acquisitions over the years.
First round of layoffs after a merger is consolidation of corporate administrative functions. ActiBlizz finance, accounting, HR, etc is no longer needed. Microsoft already has all those needs covered. And it wouldn’t surprise me to learn ActiBlizz had a lot of administrative bloat.
Most of the knowledge workers will be kept for now. Will be future cuts there as objectives are finalized and staff needed becomes clear.
ActiBlizz finance, accounting, HR, etc is no longer needed. Microsoft already has all those needs covered.
That’s not 1900 people, that’s like 50.
I’ve been part of these before; they cut by pay. Junior artist? You stay. Senior artist? Bye. It goes all the way down to QA. A place I used to work at had massive layoffs, and were left with a QA team of 15 whose most senior member had 6 months in the industry.
This is phase 2. Phase one was last year when they laid of 10,000. those were the finance/accounting/etc people. This is specifically the games area which at this point, according to my friends caught in said layoff, says it’s mostly seniors across all (gaming) divisions.
EDIT: To be clear to the downvoters: 1. I worked at Microsoft (gaming) 5 years ago, and was caught in one of these layoffs. 2. It won’t be areas like accounting/HR/finance because that was last year. I know people caught in these layoffs, and it’s seniors in each department.
Microsoft uses, especially in Canada, a system to bypass hiring full-time employees, which they have to do here legally after 5 years of employment every X years (I forget how many). They hire from 3rd party contractors, and then refuse to rehire you after you’ve worked 4+ years, until a six month gap has occurred and you change 3rd party vendors. They do this with over half of their employees, so their gaming division has a TINY HR department because most of the staff don’t technically work for Microsoft. I met ‘our’ HR at a meeting shortly before we were all laid off, and had never had any contact with any of them (nor anyone in payroll, etc, because that was all done by our 3rd party vendors.)
lol no. 50 might just cover ActiBlizz accounts payable department.
I work for a similar sized company now. We have around 300 just in Finance. Another nearly that many in accounting. When companies get this big they have a lot of spending and assets to track.
Then you get into Marketing, Sales, HR, etc. I’d confidently bet 90% of the 1900 roles were corporate administration. I’ve personally gone through this process multiple times. I’ve even been part of making consolidation decisions for a few of them.
Edit: What you experienced will happen. But as phase 2.
When such acquisitions are happening all what happens is that the stock/shares of one company (Activision/Blizzard in this example) is replaced by the stock/shares of another company (MS in this example) and the purchasing price is simply another way of discussing the stock exchange ratio. Company can have zero money to do that.
a lot of these jobs are among the first where humans are being replaced by AI… it’s not likely to slow down soon…
We’re in open-season mode for AI at my day job. No one’s being replaced by AI.
It’s a great tool for code/copy generation, but it gets so much wrong that now we’re both coders and qa for bots feeding us scaffolding code.
The industry is at its most wealthy and yet it feels like its on fire.
Yup thats capitalism. Always need to make more money than previous year, or we have a depression… Lol.
You don’t get rich paying a ton of people 200k. You get rich not paying them. So what you are saying is actually not a contradiction!
You don’t get rich paying a ton of people 200k.
You literally do, though. Because wealth isn’t a function of the volume of currency you’ve amassed, it is the quality of goods and services that the currency can purchase. When you’ve got a ton of highly educated people working as a team to accomplish something exceptional, what you get back is far more than what you put in.
Just ask Billie Beane, a guy who is a testament to what the upper limit of $200k/player gets you in terms of a baseball team. Yeah, you can beat the average for a little while by one exceptional administrator squeezing the system on the margins. But the only way you win that final game of the season is with a budget like what the Red Soxes or the Dodgers or Astros bring to bare.
And in that triumph, you do - in fact - get rich. You fill more stadium seats. You sell more cars or phones. You build more elaborate buildings. You send people to the bottom of the sea (without them getting crushed to death) and up to the moon.
At some point, you’ve got to put forward an investment. You can’t run an advanced economy on poverty-level wages. And if you don’t have those advances in medicine and engineering and logistics and technology, what the fuck kind of rich are you?
Do you want to pay competitive salaries in Heaven or run a robber barony in Hell?
It’s a wonderful idea but it’s just not how the gaming industry is run. The gaming industry runs more like war machine production facility.
You pay some very good people lots of money to set things up, design how things are going to go, make up some prototype work. Then you set up for production, hire on tons of people to finish all the work. Once everything is up and running and all the products are out the door you cut back to a maintenance staff while you have the very well paid, highly talented core working on the next big thing. People are dying to get into the gaming industry so bad, the job pool waxes and wains in quality a little but there’s never truly a lack of new talent when you need it.
The saving grace for the industry is live cadence games. The whole subscription side of things that we don’t really want to see as gamers keep this ebb and flow of employment from happening. You stretch your production schedule out a little longer to begin with. You don’t hire up quite so heavily and then for the life of the game you keep releasing features and options, You run events to keep people subscribing.
I like the ideas you’re proposing, It just not a method that game companies are willing to try to entertain.
Software engineer (luckily not in games) here. Definitely feeling it in terms of looking for a new job. Everyone’s only looking for senior engineers and they’re SUPER picky because there are so many unemployed engineers applying, even in my country where there are a lot fewer layoffs.
January hasn’t ended yet and we are at 60% of the total layoffs of last year.
https://publish.obsidian.md/vg-layoffs/Archive/2024 not sure if this is what you’re looking for but someone has been tracking overall video game layoffs for the past 3 years. 2023 was approximately 10,600, we’re halfway there at 5600 in 2024 and it’s only been a month. That’s pretty fucked.
Lmgtfy
Game dev layoffs 2023
Take your pick of article. There are numerous to choose from, and most of them give a rough number and their sources.
Quotes a statistic
Is asked for a source
Do YoUr OwN rEsEaRcH iTs aLl ThErE oN gOoGle
Well I was wondering what the cluster fuck of 2024 would be. We had covid, Russian war, massive inflation… Now what… High unemployment?
Amazing leadership, I applaude them.
