Did Microsoft sacrifice first party studio Ensemble for the Xbox 360 price cut?
Microsoft recently announced the closure of Ensemble Studios. To many, the move was surprising considering how successful the Age series was. Microsoft indicated that the reason behind shutting down the studio was that of a fiscal nature. However, the real reason for closing Ensemble might run as deep as the Xbox 360 price cuts.
Ensemble Studios is currently working on its last title, the highly anticipated Halo Wars. Considering the studio’s pedigree in creating RTS titles, Ensemble was clearly the right choice for this brand new title.
Phil Spencer, head of Microsoft Game Studios, sent out an internal email to everyone at Ensemble regarding the studio’s closure. However, despite the distribution of the email internally, GamesIndustry.biz was able to get their hands on the leaked memo. In the email Spencer reveals that a few of the essential teammates from Ensemble would be rehired into a newly formed group and the rest of the team would be let go.
If you recall, I wrote a story a few months ago regarding how the loss of several first party studios could be concerning for Microsoft. However, it seems things have not improved despite the loss of several more studios recently. Late last year, Microsoft closed FASA Interactive after Shadowrun was developed. Several other studios that Microsoft has lost recently are: Bungie, Hired Gun (ported Halo 2 PC) and Carbonated Games (Created Fable II Pub Games).
Also, Microsoft just took a huge blow to its bottom line by cutting the price on all of the Xbox 360 models. Even though the Age series was profitable for Microsoft, the decision to close Ensemble was probably made after careful analysis of its growth potential and how it could support the radical price cuts and decisions that needed to be made for the Xbox 360.
With a huge shift in focus onto social gaming, Microsoft is banking big on the casual market with titles such as Lips, Scene It? Box Office Smash and You’re in the Movies. This strategy also falls in line with Microsoft’s desire to get the price of the Xbox 360 as low as possible to entice the casual gamer.
Bill Gates has stated in the past that the living room is to be the future battlefield for the second PC. It would not surprise me if Microsoft’s new strategy is to take Nintendo Wii’s place as the casual console of choice. If the plan is successful, not only would it ensure the highest level of market penetration for Microsoft, but it would also align the Xbox 360 with what Gates has expressed in the past. Could this all mean the eventual end of hardcore games?
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19 Responses to “Did Microsoft sacrifice first party studio Ensemble for the Xbox 360 price cut?”
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September 26th, 2008
The xbox 360 is shit, end of.
September 26th, 2008
If there was one thing i thoroughly enjoyed from Microsoft was playing age of mythology/empires 2/3….and they axe the studioes!!! wtf?!! thats gotta be pure suicide. Those games were so successful and there was so much potential. If you’re theory over the reason for axing the studios was right just over an x360 price cut, Microsoft have put too many eggs in one basket.
September 26th, 2008
I think the new Halo/Gears studio is the reason. I wouldn’t be surprised if Microsoft was going to buy the rights to the Gears of War brand either.
What I don’t get is why did they close the studio instead of selling it? It’s like throwing money away. There must be a reason for it. If they wanted to pay for price cuts, why wouldn’t you just sell the studio and make a mint.
September 26th, 2008
Ensemble lived till their expiry date. Microsoft basically fired the deadwood and re-hired the talented ones.
Like any workplace, there are a % of staff who do not pull their weight, what makes Ensemble immune to that?
September 26th, 2008
Wow i don’t think Microsoft sacrifice Ensemble studio. But if they did sacrifice that studio well Xbox 360 might be in huge trouble. Microsoft should make a handheld console to compete with our beloved precious PSP. Xbox 360 is trouble even though they are the lowest priced console. Hopefully Fable II will be worth buying. I sure won’t be buying the other so called exclusives like Rare’s Banjo or Epic Games Gears of War 2. Most of my checks this year and next year will be for PLAYSTATION 3 games and university. The Halo MMO would had be fucking amazing Microsoft crew it all up damn.
September 26th, 2008
I read this article and there are absolutly no facts to back up mikes views, it is all speculation. Where is the evidence that the studio was closed due to 360 price cuts. Also the momo states that those with talent will be employed elsewhere. Surly that makes sense get rid of the dead wood keep those with talent. And apart from bungie who they still have a close working relationship i think the loss of the other studios was based on sound business planning.
September 26th, 2008
@navy ste.
I dont see it either. If anything, and argument could be made that since MS is buying up 3rd party exclusives and timed exclusives they may feel that they dont need a strong 1st part studio lineup. I however believe that to be BS. Some of the best games come from 1st party studios.
MS also let Bungie go 3rd party, and Gearbox is rumored to be making the next Halo.
September 26th, 2008
Its kina like Music companys and artists. The game companys get a hot title and get a big head and demand massive amounts of cash. (thanks Bungie) Microsoft knows full well that its business interest involves keeping development costs down. Breaking up sucessful software companys creates many fresh start ups from the lead coders. Dont mistake Microsofts relationship with prima donna coders as the decline of the hardcore. The hardware price cuts combined with Microsofts XNA tools means… Your not worth the price anymore. Simple, go make your Millions elseware. We own or licence the code, We own or licence the intelectual property and have the software tools to fast track it with coders willing to make a fraction of the cash. Its good for the hardcore.
September 26th, 2008
Speaking of bungie, why haven’t BLORGE said anything about the new teaser trailer that popped up today from Bungie? All other video game websites have…
September 26th, 2008
Most Ensemble employees will be desolved into different MS game divisions. Stated by MS.
I didn’t see a mention for the new projects by MS’s new super studio with the lead designer for MGS4.
There is also a new group consisting of former Lioinhead ( Fable ) & Gears of War creators.
MS is just changing and mixing things up, looks like it’s starting to work to me.
September 26th, 2008
It’s over.
Age of… is the only thing that will be able to compete with SC2 for the next 10 years in RTS.
They have deep pockets, but MS is a company dedicated to the success of a product, and if anything isn’t helping that product, its dead weight.
One by one the studios fall, they leave MS, or they are disolved. Does that sound like a company that wants to stay in gaming?
Unlike Sony, if MS doesn’t see a benefit from keeping a product on the market, it won’t. Sony will keep pouring money into the PS brand in hopes of later profit. MS will only keep pouring Money into the Xbox if it furthers Windows, now or very soon. That was the plan, to get an Xbox in your house, to get MS in your living room.
I’m sad to see Ensemble go. I can’t help but to think its the biggest sign yet, however, that MS doesn’t care so much about the gaming industry anymore.
The casual gambit, win or lose. Win means another Xbox, and lose means MS is out of the next round. Mark my words. The hardcore is being pruned, and if its not the casual, MS will pull out of the race.
September 26th, 2008
because they hate microsoft
September 26th, 2008
Awww the Age series was so cool
But oh well
As for the end of hardcore, NEVAR!!!!!!oneone
But being serious for a second
There is still money to be made from ‘hardcore’ games so they will still be made. Just stop pumping gazillions of dollars into games and then complaining when it doesn’t sell 50 trillion copies.
September 26th, 2008
Idiot Dave Parrack didn’t wrie this awesome article Mike Ferro did idiot fanboy.
September 27th, 2008
Age of series owns ANYTHING microsoft can come up with from now on.
age of empires and the ensemble team are innovators….good job microsoft destroy your only decent dev team to make way for… Mii Avatars, price cuts and LIPS……
September 27th, 2008
Nintendo saw it first, MS seeing it now, Sony may never see it. The trend in console gaming IS casual, guys. Much as we might hate the thought, its clearly where the market is trending. What the closing of Ensemble tells ME is that MS doesn’t see viability in 1st party PC games, which is where the hardcore is gonna end up. Tells ME nothing about their console plans other than additional confirmation they see no future in hardcore console gaming.
My gut tells me the “next” generation of consoles will be all three releasing next gen hardware (all with Blu-ray) “casual” consoles. And PS3 will survive into the “next” gen as the only “hardcore” console getting any new games, most of which will be also released on PC.
September 27th, 2008
PS2
September 27th, 2008
I’m not sure why people believe that because the studio is gone, they will not make the Age games anymore. Some of the people were moved to a different studio. And I’m sure Microsoft still owns all of the rights.
The authors reasoning makes no sense anyway. He says that the Age series is a money maker, but he believe they cut them to save money. Wouldn’t that cause you to lose money. That’s like quiting your job to save money on transportation.
Microsoft has been making a move away from ownership to buying the best that is available for sale. Notice all of the JRPGs, didn’t see them on the original Xbox. Look at games like Shadowrun and most of the Rare stuff. Microsoft lost a ton on those games. Buy exclusives after you have seen them and you have a better chance of success. Look at how much Sony lost on a lot of the 1st party PS3 games. Most of the sells for games like Motorstorm and Heavenly Sword came from bundles. Sony makes nothing from bundles, the console was already losing money and they added games. They lost even more.
Microsoft is being very smart. And I’m sure they have a right of first refusal or something with Bungie. Bungie had to give up something for their independence.
September 28th, 2008
dcbronco:
The RPG are just timed exclusives. Almost every single game publish by SCEA AKA Sony has made them tons of money. The best selling games on PS3 are owned by Sony. Your theory about Sony not making money on bundles is a really flaw they sell more consoles and it appeals to more people so they do make a lot more then actually selling the game. You think they will be stupid enough to lose money from every side hell no. Bungie didn’t give nothing away. And Rare makes terrible games just check it out for yourself that company is not even worth owning. Microsoft still losing more money from bad hardware red light of death. Xbox 360 is alive because Microsoft doesn’t wanna face publicity destruction and shareholders insanity. In the end PS3 has the most to offer at a great value with.
PLAYSTATION 3
Blu-ray Disc
Free Online Service
PS1-PS2 Backwards compatibility with 20, 60 60 GB models.
Free Controller charger free battery
Reliability
all Flash card supported
PLAYSTATION Eye gaming business those camera games are making Sony a lot money weird.
Internet Browser
Folding@home
and many more stuff that others really don’t care or want to include.