Xbox closes Arkane Austin and Tango Gameworks, creators of Redfall and Hi-Fi Rush

The maelstrom of layoffs and closures of video game studios that has plagued the industry since 2023 and continued well into the middle of 2024 continues. In the latest development, Microsoft and its Xbox division have closed several Bethesda studios, including Tango Gameworks and Arkane Austin, responsible for titles such as the excellent Hi-Fi Rush and the ill-fated Redfall.

Microsoft shuts down several Bethesda studios: Tango Gameworks and Arkane Austin are among them

The sad news was announced by Matt Booty, head of Xbox Game Studios, in an internal message to those affected. The company cited a “restructuring of titles and available resources” as the reason for the layoffs. These layoffs are in addition to the more than 2,000 layoffs that have occurred recently following the acquisition of Activision-Blizzard.

In addition to Tango Gameworks and Arkane Austin, Alpha Dog Studios (creator of the mobile game Mighty Doom) and Roundhouse Games are also affected. In the case of the latter, the studio will not close as such, but will be absorbed by ZeniMax Online Studios, which is responsible for The Elder Scrolls Online.

As for Redfall, one of the biggest fiascos of the Xbox label in recent times, Microsoft has confirmed that the game will no longer receive updates, but will continue to maintain online functions in the short term.

This is the email that Matt Booty (Xbox Game Studios) used to announce the closure of several Bethesda developers.

The email, reproduced in full in IGN, reads as follows

Today I’m sharing changes we are making to our Bethesda and ZeniMax teams. These changes are grounded in prioritizing high-impact titles and further investing in Bethesda’s portfolio of blockbuster games and beloved worlds which you have nurtured over many decades.

To double down on these franchises and invest to build new ones requires us to look across the business to identify the opportunities that are best positioned for success. This reprioritization of titles and resources means a few teams will be realigned to others and that some of our colleagues will be leaving us.

Here are the changes going into effect:

Arkane Austin – This studio will close with some members of the team joining other studios to work on projects across Bethesda. Arkane Austin has a history of making impactful and innovative games and it is a pedigree that everyone should be proud of. Redfall’s previous update will be its last as we end all development on the game. The game and its servers will remain online for players to enjoy and we will provide make-good offers to players who purchased the Hero DLC.

Alpha Dog Studios – This studio will also close. We appreciate the team’s creativity in bringing Doom to new players. Mighty Doom will be sunset on August 7 and we will be turning off the ability for players to make any purchases in the game.

Tango Gameworks – Tango Gameworks will also close. We are thankful for their contributions to Bethesda and players around the world. Hi-Fi Rush will continue to be available to players on the platforms it is today.

Roundhouse Games – The team at Roundhouse Games will be joining ZeniMax Online Studios (ZOS). Roundhouse has played a key role in many of our recent game launches and bringing them into ZOS to work on The Elder Scrolls Online will mean we can do even more to grow the world that millions of players call home.

With this consolidation of our Bethesda studio teams, so that we can invest more deeply in our portfolio of games and new IP, a small number of roles across select Bethesda publishing and corporate teams will also be eliminated.

Those whose roles will be impacted will be notified today, and we ask that you please treat your departing colleagues with respect and compassion. We will provide our full support to those who are impacted in today’s notifications and through their transitions, including severance benefits informed by local laws.

These changes are not a reflection of the creativity and skill of the talented individuals at these teams or the risks they took to try new things. I acknowledge that these changes are also disruptive to the various support teams across ZeniMax and Bethesda that bring our games to market. We are making these tough decisions to create capacity to increase investment in other parts of our portfolio and focus on our priority games.

Bethesda remains one of the key pillars of Xbox with a strong portfolio of amazing games and thriving communities. As we look to the future, there is an impressive line-up of games on the horizon. In 2024 alone we have Starfield Shattered Space, Fallout 76 Skyline Valley, Indiana Jones and The Great Circle, and The Elder Scrolls Online’s Golden Road. As we align our plans and resources to best set ourselves up for success in this complex and changing industry, our teams across Arkane Lyon, Bethesda Game Studios, id Software, MachineGames, ZeniMax Online Studios and the Bethesda publishing and corporate teams will be well-positioned to build new IP, explore new game concepts, and expand on our existing franchises.

- Matt

As mentioned above, and as can be deduced from the letter, the arguments put forward by Matt Booty as head of Xbox Game Studios are the need to prioritize resources and cut where profitability is lower. Redfall by Arkane Austin, one of the studios affected, was a critical failure with a meager 56% on Metacritic.

On the other hand, Hi-Fi Rush has a Metacritic score of 87 on Xbox, 90 on PC and 88 on PS5, so in this case the reason could be its discreet sales, something that would also have encouraged Microsoft to open its borders and relaunch certain titles (like the aforementioned Hi-Fi Rush) on other platforms outside Xbox.

Other titles that Arkane Austin has worked on include 2017′s Prey. Tango Gameworks, for its part, has also worked on the two titles in The Evil Within saga, Ghostwire: Tokyo and Hero Dice. Shinji Mikami, the father of Resident Evil during his time at Capcom and founder of Tango Gameworks, left the studio in 2023 and revealed in an interview that he postponed his departure for eight years.