Rare restructures, Microsoft warns of earnings slip

By Tor Thorsen, GameSpotPosted Feb 17, 2009 11:43 am PT

[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.

Why is this bear smiling?

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.

422 Comments

  • gnrlstuart

    Posted Nov 20, 2009 7:31 am PT

    im sorry but the games rar have churned out apart from perfect dark may have been good, but mini games with pinatas in them dont appeal to me.
    when a new perfect dark, or decent banjo, maybe a new cool ip comes out, they will sell.

  • hahamanin

    Posted Nov 3, 2009 9:42 am PT

    its all u people's fault first of all...........i have asked many stupid people on xbox live b4 launch of banjo-kazooie that r u gonna but the game......n they just said(i think mostly frm A)its a stupid kids game .oh hell no................

  • VXLbeast

    Posted Oct 12, 2009 3:22 pm PT

    Thats too bad. Rare made some awesome stuff, they deserve to survive. I hope to see mroe good things from them in the future.

  • Nicksonman

    Posted Jul 6, 2009 11:40 pm PT

    Rare's downfall had nothing to do with the 360 or Microsoft - the 360 is just a console. The problem is in the developer's choices in the content of the games they make. Kameo and PDZ were great, but rather than go further with that level of quality and style in later games, they took the N&B route instead. Their choice, not Microsoft's.

    The only real disadvantage of being on a Microsoft system is that they can't use Nintendo characters, but that doesn't affect the quality of the title at all. I'm completely open to new characters if the games are quality.

    Besides, the 360's hardware can do a lot more for Rare than the Gamecube or Wii ever could, but because of their choices in their games, the potential hasn't been used. Rare is privileged to be allowed to work on such a hi-end system, but they changed their thinking in their ideas, and that's what stuffed them up. Microsoft didn't tell Rare to make Banjo 3 a vehicle-creation game - that was Rare's choice. Microsoft don't have any input on the content of the games, they just told Rare "Hey guys, here's a cheque, now make games exclusively for the 360" but they didn't tell them what or how to make the games. Blame Rare, not Microsoft.

  • BLuFAlc0n

    Posted Jun 3, 2009 8:00 am PT

    THIS IS ALL Microsoft's Fault!!!!
    Rare became weaker, because a very ego-centric company must steal one of the best Game Developers of THE Best Video Game Company Ever!

    Result, the game developer became crap......
    Microsoft needs to learn that Good Rare games, doesn't feel and suit well for the 360.

    In fact ALL Rare games released so far on the 360, ARE MEANT TO BE Gamecube GAMES!!!
    like:
    Kameo: Elements of Power
    Perfect Dark: Zero
    Viva Pinata
    Banjo-Kazooie
    ....and all Rare games.

    It's all Microsoft's FAULT! Because Microsoft SUCKS!
    There's NO Good Donkey Kong Games...
    There's NO DK Crew
    There's NO Good games MADE by Rare.

    It's a shame.........

  • LittleDuck

    Posted Apr 26, 2009 9:09 am PT

    I've always been a fan of rare, it's a shame to see them failing. Maybe they'll go back to nintendo. Although the day that happens the world will implode.

  • kbaily

    Posted Apr 9, 2009 4:55 am PT

    The problem is Rare is catering to an audience that doesn't exist on the 360. Rare has fun, cartoony, family games and your typical Xbox 360 owner is an adult male between the ages of 15 and 35 who wants to play bloody, online shoot em ups. Xbox continues to defend Rare with an almost Hilary Clintonesque sense of determination in efforts to push themsevles as a "family system" which is outright laughable given that all their top selling games are T and M rated games. It also doesn't help that Rare tried to "reinvent" Banjo instead of making a familiar platforming sequel that everyone wanted. If Rare doesn't want to get shut down, they need to stop this "experiementing" and crank out a few familiar sequels to Perfect Dark, Jet Force Gemini and Killer Instinct and make something that might actually sell on the Xbox for a change.

  • CoiledNewkirk

    Posted Apr 4, 2009 2:12 pm PT

    poor rare they try so hard to make these games that dont even sell well. yea lets face it, banjo was changed alot but it was still a good game if you played it. it just lacked the old banjo feeling we used to get when we were young. Kameo was excellent for an adventure game. Perfect dark great too. they should just make new ideas. If they make the most original game out their (like bungie did with the Halo series) Rare Would be back on their feat. Keyword: DECENT FRANCHISE.

  • Supremegamer64

    Posted Mar 29, 2009 10:08 am PT

    I hope they REMAKE PERFECT DARK FOR XBLA.
    Nothing can stop them as they have all rights to PD.
    (Closest thing we may ever see to Goldeneye for XBLA)

  • truckerbozo

    Posted Mar 3, 2009 6:15 am PT

    I tell ya, those crazy kids over at Nintendo! What were they thinking ditching RARE? HEHEHEHEHEHEHE

  • totaleklypse

    Posted Feb 23, 2009 10:40 am PT

    o how the mighty have fallen.

  • dark_surge

    Posted Feb 23, 2009 8:56 am PT

    As sorry as I feel for Rare, they really set themselves up for this by getting bought by Microsoft. Now people are going to get laid off because Microsoft isn't pulling the profits they were expecting by buying Rare. Maybe if microsoft wouldn't have bought Rare for 375 MILLION they wouldn't have such high expectations for sales. To put in perspective, Rare would have had to sold almost 1.5 million copies of every game they've released for the 360 to keep up with Microsoft's deep pockets.

  • CharlieFubar posted Feb 22, 2009 3:58 pm PT (does not meet display criteria. sign in to show)

    CharlieFubar

    Posted Feb 22, 2009 3:58 pm PT (hide)

    banjo with cars and gummi pieces from kingdom hearts = a very dumb idea someones not paying attention at microsoft

  • hkisam

    Posted Feb 21, 2009 7:36 pm PT

    PLEASE GOD SHOW US A NEW CONKER

  • firehawk110

    Posted Feb 21, 2009 4:32 pm PT

    (Shadowfire41:................wait.....Conker.....and RPG.....together?
    ..............Someone mail that idea to Rare right now!)

    Are you kidding me? A conker rpg? That would suck

  • edant79

    Posted Feb 21, 2009 10:31 am PT

    For the most part, Rare's success was mainly based on timing and innovation. Now that there property of MS, I honestly can't see them going back to there roots.

    And sequels just ain't gonna cut it. They need something fresh.

  • remi06

    Posted Feb 20, 2009 1:50 pm PT

    rare is still a good company but they just need to go back to there roots. THEY ADDED CARS TO BANJO WTF RARE. But im sure if they do make a new conker which they better it'll be great

  • Shadow_Fire41

    Posted Feb 20, 2009 1:42 pm PT

    review ninja is right, we got too many damn shooters and thats all most gamers play, and there are too many casual gamers, i also agree that rare should make a RPG, that would be interesting, especially if it was a Conker RPG!
    ................wait.....Conker.....and RPG.....together?
    ..............Someone mail that idea to Rare right now!

  • Shadow_Fire41

    Posted Feb 20, 2009 1:38 pm PT

    lets see what they did wrong.

    A. no new conker.
    B. they changed Banjo too much.
    C. relied to much on Rare
    D. your complaint here.

  • KhanhAgE

    Posted Feb 19, 2009 9:56 pm PT

    If Rare was still with Nintendo and they had released Nuts & Bolts on the Wii, it would have sold like hot cakes I bet.

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