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[Dane]

UPDATE:

“Saber can confirm there have been restructuring changes involving our New World Interactive subsidiary. This reorganization has unfortunately resulted in layoffs at the studio. We are working to fill existing open roles within Saber with individuals affected by these changes wherever feasible and we will be providing severance packages to those employees impacted.


“Development will continue on Insurgency: Sandstorm, as well as unannounced future projects.”

New World Interactive, the studio behind games Insurgency and Insurgency: Sandstorm, has been shut down by Embracer Group as part of the company’s self-described “restructuring”.

The news was first reported by Second Wind’s Nick Calandra and shortly confirmed to Insider Gaming by multiple sources. The announcement was made to employees on Monday morning.

Founded in 2010, New World Interactive’s first game, Insurgency, released in 2014. The studio put out two more titles – Day of Infamy and Insurgency: Sandstorm — before being acquired by Embracer Group in August 2020.

The studio had multiple new games in development as of 2023, but none had been revealed. At last check, Insurgency: Sandstorm was averaging nearly 4,000 players per day on Steam over the last three months, six years after its release.

Embracer Group has yet to respond to comment on the closure of New World Interactive or respond to requests from Insider Gaming.

Recently, Embracer confirmed that Free Radical Design was at risk of closure while also laying off employees at multiple other studios. There have also been talks of selling Borderlands developer Gearbox Entertainment.

----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Source: https://insider-gaming.com/insurgency-developer-new-world-interactive-shut-down-by-embracer-group/

This totally got me by surprise, Insurgency Sandstorm was a hit and has a healthy playerbase, Day of Infamy also had strong sales.

 

[Dazraell]

Really sucks for the dev

It looks lke Embracer is slowly emboding old "Papa EA" meme

 

[GHG]

This is fucking ridiculous.

People are still playing the game, it has a dedicated fanbase on PC and I'm pretty sure they would have been fine if not for this acquisition.

I don't know what the fuck Enbracer thought they were doing in wholesale acquiring all these developers.

 

[coffinbirth]

EDIT: I forgot about that game on part at the end. Not trying to be insensitive to the folks that just lost their jobs. I just hope someone steps up to the plate to buy up some of these studios before they're all fucked to shreds.

 

[SmokedMeat]

One of the best shooters with the best AI I’ve seen in years, and the Embracer cancer shuts them down?!!

 

[The Infectious Paradox]

Wtf.. it was so good

 

[Needlecrash]

This is some bullshit. The game is still being played for fucks sake! Embracer looking worse than Ubisoft and EA at this point.

 

[Crayon]

Embrace, over-extend, extinguish.

 

[HL3.exe]

Fuck me. Wtf. I once applied for a job there, but the SP project got cancelled.

Best of luck to the devs.

 

[phant0m]

One of the few games I regularly come back to. Their content pipe was good too, usually got a big update with a new map & weapons every year.

Hope it continues on somehow

 

[Men_in_Boxes]

"It has a healthy player base!"

Checks the Steam numbers.

Ghost Recon Breakpoint has over 2x the player base on Steam alone.

It does not have a healthy player base.

 

[kiphalfton]

Devs making Alone in the Dark probably sweating bullets.

If game bombs like Saints Row did, they're gonna be on the chopping block no doubt.

 

[Denton]

The owners of the studio should have some millions of USD from the sale to reform as a new studio, I'd hope.

 

[S0ULZB0URNE]

So what about supporting the game with a new dev?

 

[BlueLyria]

So what's going to happen to Sandstorm development?

 

[Dane]

UPDATE:

“Saber can confirm there have been restructuring changes involving our New World Interactive subsidiary. This reorganization has unfortunately resulted in layoffs at the studio. We are working to fill existing open roles within Saber with individuals affected by these changes wherever feasible and we will be providing severance packages to those employees impacted.


“Development will continue on Insurgency: Sandstorm, as well as unannounced future projects.”

 

[phant0m]

Beginning to think I see Embracer's strategy. Acquire a bunch of studios, shut them down, take the IP, license the IP out to outsourced studios so they just get IP royalties without having to actually fund developers.

 

[DaciaJC]

Awful news for the people who were laid off. The Insurgency series was one of the best modern tactical shooters, and Day of Infamy was quite good in its own right as well.

 

[Rawbutt Jellybean]

"It has a healthy player base!"

Checks the Steam numbers.

Ghost Recon Breakpoint has over 2x the player base on Steam alone.

It does not have a healthy player base.

A steady 2k concurrent players on Steam is fine. They can't all be PUBG or CSGO.

 

[Dazraell]

UPDATE:

“Saber can confirm there have been restructuring changes involving our New World Interactive subsidiary. This reorganization has unfortunately resulted in layoffs at the studio. We are working to fill existing open roles within Saber with individuals affected by these changes wherever feasible and we will be providing severance packages to those employees impacted.


“Development will continue on Insurgency: Sandstorm, as well as unannounced future projects.”

It might be worth to update the first post with this info

 

[Men_in_Boxes]

A steady 2k concurrent players on Steam is fine. They can't all be PUBG or CSGO.

At what # should a developer/publisher start worrying?

 

[GHG]

At what # should a developer/publisher start worrying?

That depends on how much it's costing them to keep on updating the game.

By all accounts this was a small studio. It's a scummy move by Enbracer whichever way you want to spin it.

 

[Men_in_Boxes]

That depends on how much it's costing them to keep on updating the game.

By all accounts this was a small studio. It's a scummy move by Enbracer whichever way you want to spin it.

Cutting developers who aren't able to make a profitable game should never be considered "scummy". Business ain't charity.

 

[Mibu no ookami]

This is fucking ridiculous.

People are still playing the game, it has a dedicated fanbase on PC and I'm pretty sure they would have been fine if not for this acquisition.

I don't know what the fuck Enbracer thought they were doing in wholesale acquiring all these developers.

If I worked for a studio and Embracer or Microsoft bought the studio, I'd immediately start looking for work elsewhere.

Consolidation is going to happen in gaming, but it needs to happen more organically for it to be sustainable. Gaming is an extremely competitive market. At a point, you're making games that are competing against each other, especially for long-term sales, which are crucial for some of these bigger AAA games.

So many of these games Embracer was pushing were middle-of-the-pack games that were never going to have legs. They might break even or if they're lucky with timing and reception go on a bit of a run, but a lot of them aren't going to be worth the advertising budgets and continued development costs when you're deeply in the red.

Worse no one is going to buy those studios from them now, because everyone is basically downsizing.

 

[LordBlodgett]

That's actually a little crazy. These games still have players, and New World Interactive has proven they can make decent games. Embracer must be bleeding much more than expected, and this dev likely doesn't have anything close to ready. This looks like THQ Nordic all over again, which is the ashes that Embracer rose out of. If they can't even keep some of their better studios alive then what's going to happen to their other big devs like Gearbox, Deep Silver, Crystal Dynamics, and Eidos?

 

[crackajack]

Embracer seems to be deadset on axing/shrinking their rather new teams before anything of value happens under the new umbrella. Why did they buy studios left and right that they seem to have no confidence at all to deliver something? I guess not all of them were top quality, but what did they expect? Sprinkle a few dollars more than what those teams had before on them and then boom, megahit after megahit?

I guess it is possible that too many studios acted like Sony Japan, having a ton of prototypes but nothing actually good. But their suits should be able to estimate the value of a studio more correct than going panic mode on all fronts after Saints Row's and Gollum's failure, already closing the responsible two studios, that had also a quite good track record before.

I guess mergers usually cost work places, but if the growth results in no/less games and no/few surviving studios? wtf

 

[Mibu no ookami]

Cutting developers who aren't able to make a profitable game should never be considered "scummy". Business ain't charity.

It's not just that the games wouldn't be profitable, it's that they have too much risk in their portfolio. They're trying to narrow their portfolio to the games MOST likely to be very profitable so they can reduce their operating costs and ease their cashflow problems.

Imagine game X, I project game X to make a 5 percent return on investment, with a 20 percent margin in either direction.

That's too risky when you're in the red, but it might not have been too risky if it belonged to a different company.

What Embracer should be doing is trying to sell some of these games to other publishers and I'm sure they've tried a multitude of things.

The problem is that they bit down on more than they could chew.

 

[Men_in_Boxes]

That's actually a little crazy. These games still have players, and New World Interactive has proven they can make decent games. Embracer must be bleeding much more than expected, and this dev likely doesn't have anything close to ready. This looks like THQ Nordic all over again, which is the ashes that Embracer rose out of. If they can't even keep some of their better studios alive then what's going to happen to their other big devs like Gearbox, Deep Silver, Crystal Dynamics, and Eidos?

Reminder: Embracer would rather sell these studios than axe them. You have to ask yourself why they can't sell them.

 

[Krappadizzle]

Insurgency 1 and 2 are great games. Bummer.

 

[winjer]

This is really sad. Insurgency games are very good, especially the first one.
Embracer is such a scummy company for buying out all these studios, and then close them off, because they can't manage so many acquisitions.

 

[Dazraell]

Embracer seems to be deadset on axing/shrinking their rather new teams before anything of value happens under the new umbrella. Why did they buy studios left and right that they seem to have no confidence at all to deliver something? I guess not all of them were top quality, but what did they expect? Sprinkle a few dollars more than what those teams had before on them and then boom, megahit after megahit?

I guess it is possible that too many studios acted like Sony Japan, having a ton of prototypes but nothing actually good. But their suits should be able to estimate the value of a studio more correct than going panic mode on all fronts after Saints Row's and Gollum's failure, already closing the responsible two studios, that had also a quite good track record before.

I guess mergers usually cost work places, but if the growth results in no/less games and no/few surviving studios? wtf

Gollum was published by a different publisher (Nacon). The only ties that Embracer has to this is the fact it's they're the owner of Lord of the Rings brand, but in this case I believe they were only providing licence

As for the main thing you mentioned, I think their panic mode isn't caused by lack of games (quite contrary, Embracer apparently has dozens of projects in development) but is tied to sustainability of their growth. They were acquiring everything left and right to the point that their money started drying out and they probably don't have enough money to keep everything afloat for a longer period of time

 

[Mibu no ookami]

Embracer seems to be deadset on axing/shrinking their rather new teams before anything of value happens under the new umbrella. Why did they buy studios left and right that they seem to have no confidence at all to deliver something? I guess not all of them were top quality, but what did they expect? Sprinkle a few dollars more than what those teams had before on them and then boom, megahit after megahit?

I guess it is possible that too many studios acted like Sony Japan, having a ton of prototypes but nothing actually good. But their suits should be able to estimate the value of a studio more correct than going panic mode on all fronts after Saints Row's and Gollum's failure, already closing the responsible two studios, that had also a quite good track record before.

I guess mergers usually cost work places, but if the growth results in no/less games and no/few surviving studios? wtf

They went on a spending spree when interest rates were low and cash was cheap. The value of game companies were on the rise. You have a few hits here and there and then you sell some of these assets if not all of them to a company like Tencent, Apple, Amazon , Saudis e.t.c.

These were not supposed to be super long-term investments.

The pandemic ended and gaming stocks kind of crashed back down to earth, yet game development times were largely impacted by covid, higher detail games, and remote work.

Embracer doesn't have a proper management structure, so all of these entities are basically independently run studios on a ledger that were never supposed to be long term assets.

Imagine there is an asset thats value rose from 500 to 1000. You buy it for 1100, thinking you can spin it for 1500, but then the value of all like assets drops to 550.

You don't want to sell at first because you think you can salvage the situation, but now the asset is worth 450.

In reality, these studios are worth far less because they incur operating costs. It's why Square Enix didn't want to wait to find a better buyer for its studios and Embracer was actually able to sell the Tomb Raider IP off later at a better price. Square Enix just wanted Crystal Dynamics off their books.

 

[Bkdk]

I do wonder even if not embracer, how many of these game devs would survive anyway, possibly they would all be shut down themselves anyway with worsening economy and rising competition.

 

[GHG]

Cutting developers who aren't able to make a profitable game should never be considered "scummy". Business ain't charity.

Embracer's idea of a "business" is fundamentally flawed.

Hence they are scrambling around indiscriminately making cuts to(or shutting down) recently acquired businesses.

They can get fucked. The post from Mibu no ookami outlines everything, nothing more needs to be said.

 

[StueyDuck]

See now this is when MS is meant to swoop in.

I'd rather they bought a team like this instead of all of AAA gaming

 

[Clear]

Embracer seems to be deadset on axing/shrinking their rather new teams before anything of value happens under the new umbrella. Why did they buy studios left and right that they seem to have no confidence at all to deliver something? I guess not all of them were top quality, but what did they expect? Sprinkle a few dollars more than what those teams had before on them and then boom, megahit after megahit?

My opinion remains that Embracer's plan was to acquire as many IP as possible in order to make themselves seem more appealing to investors in a gaming landscape dominated by streaming services and where maintaining a steady flow of content is of paramount importance.

Its why I described it as "IP-flipping" in a previous post; they assumed a commodity supply model for a commodity-consumption based marketplace was their path to riches, and unfortunately for them their plan has fallen way short due to development time-scales being longer than expected and the growth in streaming/service platforms being slower than expected.

 

[Mibu no ookami]

We give Square Enix a lot of shit (and rightfully so), but they could have just closed Crystal Dynamics and sold Tomb Raider for more than they sold the the studio for.

Rather than put a ton of people out of work, they took less money and kept Tomb Raider and Crystal Dynamics together. Crystal Dynamics is working on a Tomb Raider game right now, but say that game doesn't perform super well and Amazon elects to send that IP to a different studio in the future, that'll probably be the end of Crystal Dynamics.

They're on the hot seat.

 

[Men_in_Boxes]

Embracer's idea of a "business" is fundamentally flawed.

Everyone's idea of business is "flawed". Embracer has teams of MBAs that have worked in the games industry for decades. The idea that random gamers know what Embracer should do, when they know almost nothing of the inner workings of their business will never not be amusing.

It's literally random dude yelling at Steph Curry that he could have hit that wide open 3.

Hence they are scrambling around indiscriminately making cuts to(or shutting down) recently acquired businesses.

I can assure you, they're making cuts discriminately. You don't grow to become Embracer by randomly rolling dice on future investments.

 

[GHG]

Everyone's idea of business is "flawed". Embracer has teams of MBAs that have worked in the games industry for decades. The idea that random gamers know what Embracer should do, when they know almost nothing of the inner workings of their business will never not be amusing.

It's literally random dude yelling at Steph Curry that he could have hit that wide open 3.


I can assure you, they're making cuts discriminately. You don't grow to become Embracer by randomly rolling dice on future investments.

You have to be joking. Having an MBA doesn't make you infallible, nor does it mean you are competent.

They have made miscalculations, hence they are having to make cuts and write down investments. That doesn't happen unless mistakes have been made.

Make no mistake, as an entity they are 100% in survival mode at the moment.

 

[Men_in_Boxes]

You have to be joking. Having an MBA doesn't make you infallible, nor does it mean you are competent.

They have made miscalculations, hence they are having to make cuts and write down investments. That doesn't happen unless mistakes have been made.

Make no mistake, as an entity they are 100% in survival mode at the moment.

Make no mistake...if a ship is taking on water...you'd best trust that the captain and crew with a wealth of experience is going to make better choices on fixing the situation than the person who watched Master and Commander from his couch a few years ago.

 

[TheMan]

Daaamn this is a good game with a seemingly strong following. I have it myself and it’s dope. Sad to see them go under

 

[CamHostage]

I do wonder even if not embracer, how many of these game devs would survive anyway, possibly they would all be shut down themselves anyway with worsening economy and rising competition.

Many would be gone, or would be working on smaller-scale indie projects. (Or would be doing anonymous contract work on CoD/Fortnite, or would be working up some mobile/GAAS/MTX-oriented project that GAF would scoff at.)

You look at the names under the Embracer banner and can't think of who else would have embraced them in the modern game market. The publisher-owned developer business is shrinking to almost nonexistence (look at how many games major publishers put out these days, it's all cutting back; Activision for example currently produces for two product lines outside of Blizzard releases, and Crash may well be over as well,) and the former workhorse business of spec projects and licensed titles for third-party development studios is also hard to find. Then there's the independent market, which is incredibly difficult and tends to be attracted to the types of games outside of traditional product line that many of these companies on the hook are known for (and at production budgets they are unaccustomed to.) Many of these development studios are used to having a parent company and/or doing contract work for established publishers; they're not set up to fund themselves for extended periods and peddle their own original IP. A few would have risen to the challenge on their own, but only a few, and not all in ways gamers might have been happy with given what sells these days.

Embracer bought up a ton of veteran studios and legacy IP, in part hoping to give the the '90s/00s another go, and maybe that could have worked if they had been faster and more cost-efficient on delivering nostalgic hits and franchise resurrections. And if they had gotten their big investor infusion, maybe they wouldn't be making such ugly moves now (although no business seems happy with its current revenue, everybody is making trims where they can make operating costs seem rosier.)

You're right that there would have been many of the same corpses without Embracer's foolhardy get-big-fast expansion run, but probably we wouldn't have noticed the same as this singular company having a violent bloodletting.

 

[Dane]

It might be worth to update the first post with this info

Can mods do that? I can't edit the title. EviLore

 

[Dazraell]

Can mods do that? I can't edit the title. EviLore

I was mostly referring to copying the update from your other post to the first post. But yeah, changing title would also be sensible as that's the first thing everyone can see