A source close to multiple developers at Ignition Austin told Gamasutra that the studio's entire console team was laid off, while a PC team operating at the location was unaffected. The source said that "guards" met the staff at the office doors on Friday morning.
A company rep for Ignition said in an email, "We can confirm that a small console team, which was working on pre-production of an unannounced title, was laid off. The PC team was unaffected."
The rep said she could not reveal the number of people laid off, or the number of those remaining at the studio, but the source cited Ignition staff who said around 15 people lost their jobs.
Ignition Games, a subsidiary of media conglomerate UTV, said in September last year that it would cease development operations in the UK. The following November, the company said it would close its Florida studio. Early this year, Ignition then closed its West and East Coast U.S. offices to consolidate operations in Austin.
The Austin studio had taken over development of the Unreal Engine 3-powered first-person shooter Reich from the shuttered Florida studio. Ignition had not commented on the status of that title as of press time.
Also unclear is the status of Ignition's Tokyo, Japan studio, which developed the action game El Shaddai: Ascension of the Metatron. Former Ignition employees said Friday the Tokyo office -- which Gamasutra understands only had a small core team left -- was closed. El Shaddai is Ignition's next major title, and is releasing on Xbox 360 and PlayStation 3 on July 26 in North America.
[UPDATE: Ignition said it has ceased internal development of games: "In order to facilitate shifting the publishing focus to more effectively work with innovative independent developers and explore new platform possibilities, Ignition Games has taken the strategic decision not to continue with internal development of games."]