Nearly 400 people lost their jobs at 38 Studios and its subsidiary Big Huge Games Thursday when the troubled game maker laid off its entire staff.
A notice explaining the company was experiencing an "economic downturn" was distributed to workers. It went on to state that all employees were subject to immediate non-voluntary and non-disciplinary layoffs.
The studio, which published its first game, Kingdoms of Amalur: Reckoning, in February of this year, apparently missed midmonth payroll, as well as a scheduled $1.1-million payment on a highly publicized $75-million guaranteed loan granted by the Rhode Island Economic Development Corporation that moved the company from Maynard, Massachusetts to Providence in 2010.
Founded by Major League Baseball pitcher Curt Schilling in 2006, it acquired Timonium, Maryland-based Big Huge Games (the studio behind the critically and commercially successful Rise of Nations) in 2009, and put together what some dubbed a "dream team" of talent including Elder Scrolls designer Ken Rolston, fantasy scribe R.A. Salvatore, comic legend Todd McFarlane, and prolific game score composer Grant Kirkhope.
Speaking at a conference shortly after the news broke, Rhode Island governor Lincoln Chafee placed blame on poor sales of the studio's sole game, which, despite broad critical acclaim, moved just 1.2 million copies in its first 90 days.
According to Mr. Chafee, the game needed to sell 3 million copies just to break even.
Contributing to the studio's financial burden was the ongoing development of a massively multiplayer online game, which has been in the works since 38 Studio's inception and still has no set release date.
38 Studios has proven a reliable source of minor headlines over the years, and not just for its business dealings with state government organizations.
With the company now apparently shuttered, future games set in the ambitious fantasy world of Amalur, for which 10,000 years worth of history has been crafted, now seem unlikely.