While it has been a successful year for the video gaming industry, with many, such as Tim Sweeney, claiming Fortnite is starting to grow again, it is not sunshine and happiness behind the scenes. For example, gaming industry workers are in a worse position than ever with market changes like the recent announcement of Unity’s Runtime fee and the cancellation of E3, leading to many companies forgoing their staff in a mass layoff.
Thus, despite claiming a marginal year improvement, Epic Games CEO Tim Sweeney was the latest high-profile gaming personnel to join the mass layoff. While it is understandable that staff are unhappy about being laid off, a developer has called out Tim Sweeney and Epic Games for failing to pay him royalties. In this article, we will look at the amount of people Epic Games has forgo, Tim Sweeney’s Official Statement and the accusation of Hato Moa.
Tim Sweeney Cuts Almost 900 Jobs In Video Game Industry Amidst Mass Layoff
On September 28, Tim Sweeney confirmed that Epic Games is laying off about 16% of its workforce, totalling around 870 people. Furthermore, he also mentioned the company is divesting the audio platform Bandcamp and spinning off most of its SuperAwesome team.
To put it into perspective, 250 staff are leaving via Epic’s divestitures of Bandcamp and SuperAwesome. Moreover, many people in charge of creating and running the whimsical battle royale game Fall Guys also did not escape the harsh layoff.
While many of the unlucky chosen would feel disheartened, Tim Sweeney has given the affected staff and developers six months of severance and six months of Epic-paid healthcare benefits. Furthermore, Epic Games is accelerating stock option vesting to allow people two additional years to exercise their options. In addition, the company is also providing impacted developers in the US any unearned profit sharing from their 401k.
Tim Sweeney’s Official Statement: “Saying Goodbye to People Who Have Helped Build Epic Is a Terrible Experience for All.”
Offloading staff is a cruel job, and many with a compassionate heart, unlike Elon Musk, will need sufficient preparation to tell the people working with him the harsh truth. In the case of Tim Sweeney, he wrote a wordy statement in a memo before sharing it with the staff and on the company’s official website.
In his statement, he mentioned that the company has been spending way more money than it earns by investing in the next evolution of Epic and growing Fortnite as a metaverse-inspired ecosystem for creators. Moreover, he clarified: “Fortnite’s growth is driven primarily by creator content with significant revenue sharing, and this is a lower margin business than we had when Fortnite Battle Royale took off and began funding our expansion. While success with the creator ecosystem is a great achievement, it poses a massive structural change to the economics.”
Lastly, Tim Sweeney bid his staff goodbye and mentioned he would reimburse the affected employees. “Saying goodbye to people who have helped build Epic is a terrible experience for all. The consolation is that we are adequately funded to support laid-off employees.”
Hato Moa Accuses Tim Sweeney and Epic Games of Not Paying Royalties
A day after the mass layoff, Hatoful Boyfriend creator Hato Moa came forward and stated that she had not received any royalties from Tim Sweeney or the company. For those who need a refresher, Hatoful Boyfriend was a pigeon dating sim developed under Mediatonic before Epic Games acquired the company in 2021.
After the game became available on Epic Games in 2021, Hato Moa released a tweet asking why Epic Games had not released her payment. Furthermore, she wanted answers to why Epic Games suddenly delisted Hatoful Boyfriend from the PlayStation Store, Google Play, and Apple Store two years ago.
It is not the first time workers in the gaming industry have called out the company, as Genshin faced a similar situation with their voice actors months prior. While Epic Games did reach out to her and Hato Moa herself, reiterating that the case was not as bad as it seems, it makes you wonder what truly happens behind the scenes in the gaming industry.
Concluding Thoughts
As the massive shift in the gaming industry market unfolds, it is inevitable for companies to forgo profit for attaching human emotions. Epic Games CEO Tim Sweeney offloading 16% (870 people) may seem a lot, but if you compared it to Microsoft dropping 10,000 staff in January this year, it may seem like a drop in the ocean. What is your opinion? Let us know on our Facebook, Instagram and X pages.
Frequently Asked Questions
What Is the Future of Epic Games?
Even though Tim Sweeney has offloaded 16% of his staff, he remains optimistic about the future of his company. According to him, the prospects for the future are strong, and their aim now is to become a profitable company again and cement itself as a leading metaverse company.
What Other Companies Have Undergone a Mass Layoff?
Besides Epic Games, SEGA announced on the same day that it was also undergoing internal restructuring after cancelling its Creative Assembly’s shooter Hyenas and other projects. Other companies that have imposed a mass layoff include Ubisoft, Blizzard, Unity, EA and more.
Is the Future Outlook of the Gaming Industry Bleak?
It is understandable why people are now pessimistic about the gaming industry’s future amidst massive offload. However, the gaming industry is forever growing in popularity. Currently, it is estimated the total amount of gamers worldwide is around 3 billion. Thus, when the supply of video games increases, the demand for creative individuals and professionals will also increase.
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