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38 Studios' ongoing financial issues lead to staff layoffs
38 Studios' ongoing financial issues lead to staff layoffs
May 22, 2012 | By Mike Rose

May 22, 2012 | By Mike Rose
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More: Console/PC, Business/Marketing



As part of Kingdoms of Amalur house 38 Studios' ongoing financial issues, the Rhode Island-based company has been forced to lay off a number of its staff.

The studio's money problems came to light earlier this month, as it was revealed that the company failed to make a scheduled $1.125 million loan repayment. The studio had previously been granted a $75 million loan from the government-owned Rhode Island Economic Development Corporation in 2010, after it agreed to move its operations to Rhode Island.

While the studio finally managed to make the payment last week, it was unable to pay its employees and missed the payroll.

According to a new report from ABC this week, Rhode Island Governor Chafee has now said that layoffs have occurred at the studio, as part of its move to make the aforementioned loan payment.

"I believe it was a mix of who's made payroll and a number of layoffs," he said of Monday's meeting between the studio and the state. He did not state exactly how many layoffs there have been.

"I know that the taxpayers want answers, and they'll get them overtime," he continued. "All I can promise is that we're working hard to protect every penny of the investment that was made."


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Comments


Kevin Rabun
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Best of luck to everyone impacted. Layoffs are an emotional time for those going and staying.

Damien Foletto
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My condolences to all those affected. I know Turbine and Avalanche will be holding job fairs in Rhode Island either this week or next, so there's hope that those displaced won't be displaced for long.

Kale Menges
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Sucks when talented people have to bite the bullet for poor leadership and company management.

E Zachary Knight
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Don't forget government waste.

Jack Lee
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I would argue it's too early to decide blame in this. We don't really have much information about what's happening inside 38. Are there likely some missteps? Sure, absolutely, but pointing the finger at "poor leadership and company management" is just too vague and hostile, in my opinion.

We'll see how it shakes out. I, for one, hope they get it together. I've been consistently charmed by Curt and the game leads in all the interviews I've heard with them, and I'm excited to eventually get around to KoA: Reckoning. Reservations about another fantasy MMO abound, but maybe Copernicus will be great.

Michael Rooney
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I think it's safe to blame Rhode Island at least in part. That was just an all around terrible investment with unreasonable conditions that put 38 studios in a position where even under the best conditions they'd probably fail.

They could have put the money into smaller investments into many studios that would have a better chance of being paid off or at least with the losses to the state being recouped in citizens with jobs instead of a bunch of newly unemployed people.

Nathan Zufelt
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When a studio misses payroll, you can sure as hell blame management. It's not pleasant to miss a rent/mortgage payment because your boss didn't tell you that they ran out of money yet still let you come in and work the last two weeks.

Eric Geer
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I'm sorry to hear about the lay offs, but with all the news building around this, It was bound to come.

I still feel the issue with taking the government loan money was in the terms and conditions themselves---400 employees by 2012---that's just unnatural with only 1 game shipped.

Anyway---with the recent flyover video of Copernicus...i am actually very intrigued and excited for it.
http://www.youtube.com/watch?v=m9nvnrP0j8U

james sadler
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Looks like the company and the government took a gamble and are losing. Happens. Sad some hard working people had to pay for it.

Ed Macauley
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I was in a similar situation with another company (huge layoffs, but other staff remained to work on the product). It sucked at the time, but I'm glad that it happened that way. Best of luck folks, there *are* other companies hiring.


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