Rare restructures, Microsoft warns of earnings slip
[UPDATE] Following disappointing Banjo-Kazooie: Nuts & Bolts sales, UK studio reorganizes to "speed" four projects in pipe; corporate parent says economic downturn will hit sales.
In 2002, Microsoft paid $375 million to buy Rare Ltd., developer of such Nintendo 64 hits as GoldenEye 007, Perfect Dark, and Banjo-Kazooie. However, sales of Rare's subsequent releases have failed to recoup its then-record-setting purchase price. Despite solid reviews, Perfect Dark Zero, Kameo: Elements of Power, Viva Pinata, Viva Pinata: Party Animals, and Banjo-Kazooie: Nuts & Bolts generated just over $66 million combined domestically over three years, according to the NPD Group.
Now, after shutting down internal studios FASA, ACES, and Ensemble, Microsoft has set its reorganizational sights on Rare. In a statement released to GameSpot, studio manager Mark Betteridge said the UK-based shop is undergoing a restructuring that could result in layoffs.
"As the entire industry struggles to address the increasing scale and cost of development, we too have felt a need to restructure our current approach so we can speed development and better manage the scale required to create high quality games," explained Betteridge.
Currently Rare has four unnamed projects in development, and Microsoft Game Studios reps did not say which--if any--would be affected by the changes. However, the reps did say that the publishing label "will be implementing a new approach to current projects in the pipeline" and that "a small number of current positions could be lost" at Rare as a result.
The Rare restructuring comes as Microsoft is grappling with wider issues related to the worldwide economic crisis. Just under a month after it announced that it was slashing 5,000 jobs due to falling profits, the software giant's CEO, Steve Ballmer, revealed that its sales will continue to slide.
"Revenues in our industry, and in our company, will be affected by the economic conditions," Ballmer told the Reuters news service yesterday.
Content you might like…
Users who looked at this article also looked at these content items.
Hot Stories
Newsmakers
-
Preowned games on Xbox One decided by publisher
Microsoft confirms that it won't charge any fees for any titles eligible for resale. Full Story
- Posted Jun 6, 2013 4:00 pm PT
-
Microsoft confirms required 24-hour check-in for Xbox One
Playing Xbox One games on somebody else's console will also require a check-in every hour. Full Story
- Posted Jun 6, 2013 3:41 pm PT
Featured Stories
-
PlayStation 4 will cost $399
Sony confirms a $399/€399/£349 price for the PlayStation 4 hardware, $100 cheaper than Microsoft's Xbox One. Full Story
- Posted Jun 10, 2013 11:19 pm PT
-
New Halo coming to Xbox One; runs at 60fps
Will be coming in 2014. Full Story
- Posted Jun 10, 2013 11:11 am PT
-
Del Toro calls BioShock Infinite a 'mindf*ck'
Pan's Labyrinth director praises Ken Levine and Irrational Games for latest BioShock, says he would consider large-scale Pacific Rim game "God willing." Full Story
- Posted Jun 13, 2013 8:53 am PT
-
Microsoft: Xbox One will be leading product people love and embrace
Xbox boss Don Mattrick believes concerns over connectivity are overblown, recommends Xbox 360 for those without an Internet connection. Full Story
- Posted Jun 11, 2013 5:52 pm PT
-
New Mirror's Edge is open-world
EA Labels boss Frank Gibeau describes new project as "open-world action adventure game." Full Story
- Posted Jun 12, 2013 10:45 am PT
Related Game
Perfect Dark Zero
- Publisher(s): Microsoft Game Studios
- Developer(s): Rare Ltd.
- Genre: Action
- Release:
- ESRB: M







