After ZeniMax layoffs, The Elder Scrolls Online may never be the same

Unfortunately, it does not immediately come as a surprise The Elder Scrolls Online Developer ZeniMax Online Studios has suffered as a result of Microsoft's recent job cuts, but the latest development reveals just how bad things are for the Maryland outfit. ZeniMax Online's staff has been cut by more than 200 as part of Microsoft's latest cull, a number that includes several senior roles, including Studio Head Joseph Burba, a 14-year company veteran.

Other notable roles involved include Studio Operations Director, Studio Game Director, Studio Art Manager and VP of Global Sales and Business Development. It is a shocking turn of events, doubly so when seen in context The Elder Scrolls Online like MMOs, a genre that needs much more ongoing support than others. With so many eliminations, there's a good chance that The Elder Scrolls Online could meet the same fate as Destiny 2 shortly, despite still having a healthy player base. This is obviously a shame on several levels, but such a mass exodus of talent could have even more significant consequences for ZeniMax Online down the road.

As previously mentioned, The Elder Scrolls Online needs extra attention as an online game, and such a massive reduction in staff will almost certainly have a negative effect on the game's content going forward. More interesting, though, is what this could mean for ZeniMax Online Studios — a developer that literally has the word “online” in its name. It's highly unlikely that this particular branch of ZeniMax will scale back by making smaller single player games, or even small multiplayer games, going forward. It's hard to guess what ZeniMax, and by extension Microsoft, has planned for the studio, but closure looks a bit more likely than a comeback at this point.

Of course, ZeniMax's public statements about its future are more optimistic. In a letter obtained by Game File, ESO Producer Susan Kath and studio game head Rich Lambert wrote that they have great confidence in “the continued growth of ESO” under the new leadership of Josh Henderson and Nick Giacomini; Henderson was previously Head of Business Operations, while Giacomini was promoted from Director of Product Management to Game Director of The Elder Scrolls Online just last year. It appears the pair will head the studio together.

These statements are hard to understand, and even harder to take at face value. There hasn't been much status quo on Xbox lately – the brand bought up studios for billions of dollars just a few years ago, and now so many of them have shut down or downsized, so promises of “continued growth” in a game that ESO can feel frivolous. If ZeniMax online really plans to grow The Elder Scrolls Onlineit will probably be quite a difficult time, given this talent exodus. With over half a dozen senior roles eliminated, the leadership structure that saw ESO make it past the ten-year mark (an increasingly rare milestone in the live service space) has now been raised. Like Id Software before it, consistently strong performance wasn't enough to save ZeniMax from the dreaded “Xbox reset.”

The future of ZeniMax Online Studios suddenly seems to be in jeopardy

Again, more than 200 roles at ZeniMax Online were terminated this summer, and while I'm sure at least some of those roles will be filled in the coming months and years, the loss of talent and experience is not so easy to replace. This is especially true for the affected leadership and management positions: there's really no telling how a team will react to so many sudden changes in leadership and chain of command, and during a busy time for the industry to boot. Even if ZeniMax decides to invest heavily in its new talent (something that seems incredibly unlikely, given the reasons behind Xbox's mass layoffs), this new talent may not be the best fit for ESO. That would be one thing ESO was reeling and in dire need of new leadership, but that doesn't seem to be the case.

One of the reasons a story like this is so frustrating is because, from a consumer's perspective, these decisions seem so counterintuitive. You can improve your revenue and perceived growth by aggressively cutting roles, and maybe some companies' staffs can be trimmed, but talented, dedicated people are the ones who make games at the end of the day. If a game company fires thousands of people, it will miss out on all the ideas, support and expertise those people would have offered in the future. The blending of these ideas and experiences is what leads to great games, and you can't put a price on that.

The ZeniMax Online situation is a microcosm of the game's larger problems

I don't mean to pick on anyone, but situations like these are how companies like BioWare and Konami fall from grace. We've seen how badly even one person's departure (eg Casey Hudson, Hideo Kojima) can affect a studio's output and public perception for years on end. Dismissed ESO Staff like Joseph Burba and Susan Kath may not be Hudson- or Kojima-level developers, but they still have decades of industry experience between them, and that will be incredibly difficult to replicate, especially in the midst of a company-wide restructuring deliberately designed to cut costs.

I always hope that those affected by layoffs will land on their feet, contribute their talents elsewhere and further enrich the industry, and this case is no different. But with tens of thousands of game industry workers laid off in just a handful of years, I have to wonder how many employees will simply pivot to another field, and how many starry-eyed, young developers will abandon their dreams in the face of such an unattractive industry landscape. One can only hope that studios like ZeniMax Online weather this storm, and that the industry will move towards more sustainable practices in the future.

Released

April 4, 2014

ESRB

M for Mature: Blood and Gore, Sexual themes, Use of alcohol, Violence