In the middle of some of the most chaotic years in the history of the gaming industry, studio closures and developer layoffs are once again being reported.
Sony’s Recent Studio Closures and Game Cancellations
Sony oversees its first-party game projects, including mobile game developer Neon Koi and Firewalk Studios, both of which are now being shut down. Neon Koi’s unannounced action mobile game and Firewalk Studio’s disappointing hero shooter for the PS5 and Windows PC, Concord, have both been canceled.
Sony Interactive Entertainment CEO Herman Hulst wrote to employees in an email that was published publicly by the company that Neon Koi is being shuttered to “concentrate on titles that are in line with PlayStation Studios’ pedigree and have the potential to reach more players globally.”
After Sony “spent considerable time these past few months exploring all our options,” the decision to close Firewalk and sunset the Concord game was made after the company concluded that there was no better alternative.
Hulst wrote, “After much thought, we have determined the best path forward is to permanently sunset the game and close the studio. I want to thank all of Firewalk for their craftsmanship, creative spirit, and dedication.”
Financial and Industry-Wide Impacts of the Layoffs
Last September, in the early part of the month, Concord was taken offline due to its unfortunate performance in the oversaturated hero shooter market. This happened a little over a week after it launched when the game failed to attract a broader audience. All of the players who purchased Concord were issued refunds after the game was removed, which fueled speculation that the title would never return. Those predictions were well-founded.
In the email, Hulst wrote: “The PvP first-person shooter genre is a competitive space that’s continuously evolving, and unfortunately, we did not hit our targets with this title. We will take the lessons learned from Concord and continue to advance our live service capabilities to deliver future growth in this area.”
Bloomberg News was told by a spokesperson that a total of 210 developers across both studios lost their jobs, 38 at Neon Koi and 172 at Firewalk Studio. Sony will attempt to shift workers to other PlayStation teams “where possible,” according to the internal email. Specific details have not been given.
“I know none of this is easy news to hear, particularly with colleagues and friends departing SIE. Both decisions were given serious thought, and ultimately, we feel they are the right ones to strengthen the organization,” wrote Sony Interactive Entertainment CEO Hulst. “Neon Koi and Firewalk were home to many talented individuals, and we will work to find placement for some of those impacted within our global community of studios where possible.”
In February 2024, Sony laid off 900 PlayStation Studios employees. Five months later, the creator of Destiny 2, Bungie, recently acquired by Sony, cut 220 developers as it was integrated into PlayStation. Sony bought Bungie for 3.6 billion in 2022.
What’s Next for Sony’s Workforce and the Gaming Industry?
Over 20,000 jobs in the gaming industry were cut in 2023 and 2024 alone. The additional layoffs at Neon Koi and Firewalk Studios have been devastating. Though the Concord hero shooter being shut down was not surprising, the game was serviceable. Its primary flaw was that it did not stand out in an oversaturated market with plenty of competition. It is lamentable that Firewalk Studios was shuttered in the aftermath and permanently removed from the PlayStation Studio lineup. Neon Koi’s developers will never see the release of the untitled game they worked on for so long, which serves as another blow to the gaming industry. The hope is that the developers will find new positions and that the industry as a whole will soon recover.
