Video game workers must now dread the end of every month because it almost always comes with layoff news. This time it is Sega making sweeping changes that will lead to the loss of 240 jobs across Europe.
“Today I have the most difficult news to share with you,” wrote Sega COO of West Studios and Regional Managing Director Jurgen Post in an official statement shared on LinkedIn. “SEGA Europe is proposing to reduce its workforce by approximately 240 roles and the following areas of the business will be affected: SEGA Europe, Creative Assembly, and a small number at SEGA HARDlight.”
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“Separately, the sale of Relic Entertainment has also been agreed and the studio is transitioning to become independently run, meaning it will no longer be part of the SEGA family of studios. SEGA is working closely with Relic on this shift, and we wish them the best for the future.”
The layoff at SEGA is particularly distressing because it is coming less than 72 hours before Easter. It is reminiscent of the layoffs that happened last year just before Christmas. It’s the worst way to ruin what would have been a great holiday with family and friends.
Jurgen said the decisions “have been incredibly tough to make” and apologized to those who were directly impacted by the decision. Jurgen added that the decision was made after “meticulous consideration and deliberation with leadership teams across the business”.
Relic Entertainment is based in Vancouver, Canada, and specializes in the creation of real-time strategy games including the Homeworld series, Age of Empires, and Company of Heroes. Relic is being sold to a holding company to be newly established by the UK investment company Emona Capital LLP.
Sega is making the changes to secure the future of its business
According to Jurgen, “Change is necessary to secure the future of our games business, and to ensure that we are well placed to deliver the best possible experiences to our players going forward”. Further details of the sale of Relic were not disclosed as per the request of the transferee.
“We need to streamline, focus on what we are good at, and position ourselves as best we can for the road ahead. In order to do that, we need to respond to the changing economic landscape and the challenges we’re facing in the way we develop our products and bring them to market.”
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Jurgen said that Sega already made a declaration regarding the restructuring of the Tokyo Stock Exchange but was unable to share the news with the public due to the company’s legal obligations in Japan.
Jurgen promised that Sega would support the affected employees where possible including offering them severance pay, career support, and access to independent and internal guidance, and would communicate individually with everyone affected.
“More details relating to impacted business areas and associated roles will be communicated in due course from within the affected business units,” Jurgen wrote in the concluding paragraph. “I fully appreciate this means we are moving into a very unsettled phase, and I ask that we all look after each other through this difficult time.”
Laid-off Creative Assembly employees react
Some of the employees impacted by the shakeup at Creative Assembly have posted on LinkedIn and updated their profiles with the infamous #OpenToWork green badge.
Development manager Aron Riordan wrote, “Unfortunately, I have been informed that I am once again at risk of redundancy in my role alongside many others, amazingly talented colleagues within Creative Assembly”.
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“I didn’t think I’d be back here so soon, but, in light of the recent news regarding Creative Assembly, I am once again searching for a new role in the gaming and entertainment industry,” wrote associate developer Thomas Staples.
Relic Entertainment update on the reform
Soon after the official announcement that Relic Entertainment has been sold, the company put out an update to confirm that it will become an independently-run development studio with an external investor.
“This is a huge change for us, but one thing does not change: we want to create amazing experiences for our players,” the company wrote in the update. “To our fans, we want to assure you we will continue to support our titles, including Company of Heroes 3—we are looking forward to the 1.6 Update in April, loaded with new content and features requested by our community”.
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Important Update from Relic Entertainment pic.twitter.com/nCcF8olDaC
— Relic Entertainment (@relicgames) March 28, 2024
A couple of layoffs and closures were announced this week including around 120 at Nintendo of America and the closure of Smilegate Barcelona. In an interview, Xbox boss Phil Spencer blamed layoffs on the lack of growth in the game industry.
