Tell us about the deal your reporting
on. Yeah.
So it's happening as we speak. So this is going to be announced in a in
the next week or two that embrace or group is selling essentially Sabre,
which is a big subsidiary of Embrace. Our group is going to go private.
So a little bit of context here, Embrace our group is the Swedish gaming
conglomerate that made a lot of headlines a couple of years ago because
it was buying up companies all across the video game industry, a huge spending
spree back
in the halcyon days of 2021 when the interest rates are low and
buying was easy. But of course, things have changed and
embrace. Our group has since embarked on a cost
cutting initiative that has led to carnage across the video game industry
and as shutdown studios laid people off. And now it's just looking to shed costs
whenever possible. This is the latest move on that front.
And overall, when you see these cancellation of projects, when you see
ultimately companies doing deals like this, does
it speak to some of the
pressure points that we're seeing across the entire industry?
It definitely does. And yes, just this year, this week
alone, I mean, we've just seen it's been a bloodbath.
Sony has laid off 900 people. E just said last night that it was
laying off more than 600 people. Yeah, we're seeing a climate, a lot of
it. There are few factors behind all of
these layoffs. But I think the biggest one is that
during the pandemic, when there was a lot of growth in the video game
indust
ry, a lot of these companies just swelled, they bloated, they hired too
many people, and now they are kind of they're they're facing the math.
They're looking at the numbers. The numbers have gone down a little bit.
The growth hasn't been quite what it was when everybody was stuck at home playing
video games. But the over hiring is still there.
And as always happens, the people have actually made those decisions and are
sticking around. It's the people who got hired who are
suffering as a result
of this. Jason, the other top, top story that our
audience is following is Rockstar Games, the studio behind Grand Theft Auto at
telling its employees, according to your reporting, to come back to the office
five days a week starting in April. What do you know about the decisions
behind that move? Yeah, it's interesting.
I think that in a lot of industry is a lot of industries obviously are
grappling with this question of returning to the office after employees
have gotten used to either workin
g hybrid or working remotely with the
gaming industry. It's kind of it plays off on the topic
we were just talking about because of the volatility of the video game
industry, is such that people have to uproot their lives constantly for new
jobs and so remote work is is very much a shield against that volatility.
And so for a company like Rockstar, which is one of the leading videogame
developers, to come out and say, Hey, we need you all to come in five days a week
really strikes kind of. It's
a big contrast between what we're
seeing elsewhere. Yeah, Rockstar there they their
rationale here it's largely because of security and so they've suffered from
some huge leaks of the next Grand Theft Auto game.
There was one in 2022 where a bunch of footage, early footage from the game got
leaked and dropped on the Internet. And then last year, last December, just
a couple of months ago, when they were planning on releasing their latest,
their new trailer, their first trailer for GTA six, it wa
s actually leaked on
Twitter a few hours before it was due to go up.
It was it was pretty ridiculous, actually.
It was leaked with like a giant Kiran in the middle saying by Bitcoin it was
very, very bizarre sequence of events. The game was the game is set in Florida.
I joked at the time that it's the most Florida thing ever for the game to leak
in that fashion. But this is this is one of the main
reasons that they're doing this turn off is because they believe that their
security was compromise
d as a result of people working remotely was interesting.
Those we've seen it at other tech companies.
I think a grinder who said, look, come back to the office and actually helps
them reduce their workforce with more of a natural attrition aversion because
they're like, look, if you're not going to abide by some of our rules, you need
not come back. Is that kind of what's playing into this
as well? Jason, Even though they are playing on
the security side, that is extremely an extremely common t
heory, I will say, and
I've heard that not just attached to Rockstar but also to a bunch of other
companies. Blizzard last year was big on return to
office. And one of the theories was, Hey, is
this just kind of a soft layoff? Is this a way that we can lay people off
without actually laying people off? Because we know that X percent of people
will leave when they're forced with the prospect of having to go back to the
office five days a week. So.
Very common theory. I don't have anything that ca
n prove
that, but it's certainly logical.
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