Despite what a certain host of a certain video game award show will try to say later this year, you know who you are: 2024 has NOT been a great year for gaming as a whole. Yes, great video game titles have been released, and we are grateful for that. However, there have also been duds, controversies, and, of course, the massive amount of layoffs that continue to pour in from all over. 2023 had over 10,000 people laid off, and 2024 will likely surpass that number within the next few months. To that end, Phil Spencer knows that Microsoft has been a part of that set of layoffs.
The company laid off about 8% of its staff after the merger with Activision Blizzard and has been saying all sorts of things to justify it. One such statement was that the positions were “natural to be cut” after a merger. But as Phil Spencer has now said in an interview with Polygon, another reason for the layoffs, in his mind at least, is that the industry isn’t growing:
““I’ll say the thing that has me most concerned for the industry is the lack of growth. And when you have an industry that is projected to be smaller next year in terms of players and dollars, and you get a lot of publicly traded companies that are in the industry that have to show their investors growth — because why else does somebody own a share of someone’s stock if it’s not going to grow? — the side of the business that then gets scrutinized is the cost side. Because if you’re not going to grow the revenue side, then the cost side becomes challenged.”
He went on to state that he believes that the industry can grow again and that it hurts him that people can’t “build a career” with confidence in the gaming industry nowadays, but is that really the whole story?
While it’s easy to say that the industry “isn’t growing,” we know why that’s the case. Companies like Microsoft, The Embracer Group, and more have been buying up companies left and right to “expand their brand.” They then try to make titles that are “bigger than ever” but don’t deliver the quality to make them succeed. Then, they’ll cut people to “save costs,” even though that just puts them in a hole.
Or, in the words of a certain CEO from Larian Studios, it’s greed that’s destroying the industry, but people like Phil Spencer aren’t likely to admit that.
