Xbox’s ZeniMax Acquisition Reportedly Forced Stadia’s First-Party Closure

According to a new report from Kotaku, Xbox might be one of the factors involved in Google’s decision to shut down its first-party development teams for Google Stadia.

Following the massive acquisition of ZeniMax Media by Microsoft, the whole video games industry was shocked, Google Stadia inevitably felt the repercussions of the 7.5 billion deal, this is explained by the service’s Vice President and General manager Phil Harrisons when he points at Microsoft for Google’s decision.

In his Thursday Q&A with staff, he pointed specifically to Microsoft’s buying spree and planned acquisition of Bethesda Software later this year as one of the factors that had made Google decide to close the book on original game development.

Interestingly, Harrison confirmed the closure of the first-party studio a week after praising them. “[Stadia Games and Entertainment] has made great progress building a diverse and talented team and establishing a strong lineup of Stadia exclusive games,” said Phil Harrison on January 27 in an email to staff obtained by Kotaku. The email reportedly promised more information on the Stadia studios’ strategy and goals for 2021. However, instead of exciting objectives, Harrison announced just days later on February 1, 2021, that the studios would be shutting down.

Certainly, there are a lot of questions to be made, what changed in Harrison’s mind. In the Q&A with staff, Harrison reportedly admitted that Google’s executives already knew the shutdown was coming when he sent the email praising the team’s progress.

Kotaku also reports that Harrison cited the ongoing challenges of the COVID-19 as a big factor in the shutdown of Stadia’s first-party studios. The official information from Google points at the high production cost for producing a game.

Creating best-in-class games from the ground up takes many years and significant investment, and the cost is going up exponentially. Given our focus on building on the proven technology of Stadia as well as deepening our business partnerships, we’ve decided that we will not be investing further in bringing exclusive content from our internal development team SG&E, beyond any near-term planned games.

Source: Kotaku

Stay tuned at Gaming Instincts via Twitter, YouTube, and Facebook for more gaming news.