Obsidian Entertainment
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Documents about Obsidian Entertainment
Xbox Layoffs, Halo To Activision, Destiny's Back (And More)
The gaming industry is currently navigating a period of significant structural shifts, characterized by ongoing corporate restructuring, long-term project planning, and strategic pivots for major franchises.
- Microsoft is laying off approximately 300 additional employees as part of an ongoing restructuring, with the company reporting it is now 75% through its planned reset.
- Halo development is being moved to Activision, with a small team remaining at Halo Studios to support existing games and the community, while Playground Games and Turn 10 are merging.
- Bungie has reversed its stance on the future of the Destiny franchise, announcing that Destiny 2 will unvault previous campaigns, destinations, and raids to remain a foundational part of the studio's future.
How Double Fine Survived The Xbox Bloodbath
Double Fine Productions, the San Francisco-based studio led by Tim Schafer, has returned to independence following a seven-year tenure under Microsoft’s Xbox division.
- After seven years under the Xbox umbrella, Double Fine has returned to independence following a shift in Microsoft's corporate strategy under Sarah Bond, which prioritized higher profit margins over the studio's niche, quirky output.
- The transition to independence involved a grueling negotiation process in June 2026, resulting in Double Fine securing ownership of its intellectual property and necessary runway capital, though the studio was forced to lay off 23 employees.
- Double Fine is pivoting to a 'Double Fine Action Labs' model, focusing on smaller, experimental titles and rapid prototyping to mitigate the financial risks associated with high-budget game development.
The Miraculous Story Behind Baldur’s Gate 3
The development and release of Baldur’s Gate 3 represents a significant anomaly in the modern video game industry, characterized by a complex history of licensing, financial instability, and creative perseverance.
- Larian Studios' success with Baldur's Gate 3 is attributed to its status as a rare, large-scale, privately owned developer, which allows it to avoid the short-term pressures of quarterly earnings and investor demands faced by publicly traded companies.
- The development of Baldur's Gate 3 required a massive scaling effort, with the studio growing its workforce from 140 to 450 employees to manage the complex production pipeline required for full cinematic integration.
- Baldur's Gate 3 has achieved significant commercial success, selling over 20 million copies and winning multiple Game of the Year awards despite facing major external challenges, including the COVID-19 pandemic and the forced relocation of staff due to the 2022 Russian invasion of Ukraine.
I Interviewed Todd Howard For The First Time In 15 Years
Bethesda Game Studios has officially announced a new strategic roadmap for the Fallout franchise following a significant organizational restructuring at Xbox.
- Bethesda Game Studios has officially announced Fallout 5, which is currently in pre-production and being developed alongside The Elder Scrolls 6 using the proprietary Creation Engine 3.
- Bethesda confirmed a collaboration with Obsidian Entertainment on a new, unannounced Fallout project, with Bethesda retaining management and supervisory control over the franchise.
- The company announced official remasters for Fallout 3 and Fallout New Vegas, alongside a new Fallout 76 expansion titled 'Raven Rock' scheduled for release next year.
The Xbox Bloodbath Is Actually Way Bigger Than It Seems
The recent restructuring at Xbox, which includes the divestment of five studios and the cancellation of multiple projects, has resulted in a reported 3,200 job cuts.
- The reported 3,200 job cuts at Xbox represent only a fraction of the total industry impact, as the restructuring triggers significant, uncounted layoffs at external co-development and vendor firms.
- Xbox CEO Asha Sharma announced a 50% reduction in vendor spending, which will result in widespread job losses for non-full-time staff who work on Xbox PR, marketing, and IT projects but are not included in official internal layoff figures.
- The cancellation of major projects like 'Perfect Dark' has forced co-development partners, such as Crystal Dynamics and Eidos Montreal, to lay off staff without the ability to publicly disclose their work due to strict non-disclosure agreements.
The Cruelest Part Of Xbox's Layoffs
The recent restructuring at Xbox, characterized by a massive reduction in workforce and the divestment of five studios, has created a climate of profound instability and anxiety for remaining employees.
- Microsoft has announced a major restructuring of its Xbox division, involving the layoff of 3,200 employees and the divestment of five game studios.
- Beyond the primary layoffs, Xbox is cutting its vendor spend by 50%, which will result in significant job losses for contract workers who are not included in the official 3,200-person headcount.
- Employees across Xbox, Blizzard, and ZeniMax are facing prolonged uncertainty, as a second wave of approximately 1,250 layoffs remains pending with no clear timeline for implementation.
The Outer Worlds 2 developer Obsidian has turned its studio into a real world RPG
Obsidian Entertainment maintains a high-volume release schedule by utilizing a multi-team structure that prioritizes iterative development over the risks of massive, singular-project scaling.
- Obsidian Entertainment utilizes a multi-team structure and strategic co-development partnerships, such as with Eidos Montreal, to maintain a high-volume release schedule while avoiding the risks of singular-project scaling.
- The studio has implemented a unique internal tenure program that gamifies employee loyalty by mapping out a twenty-year career path to preserve institutional knowledge.
- Obsidian is shifting its strategic focus away from sequels for established intellectual properties to prioritize the cultivation of original franchises.
AMA: Q&A with Obsidian Entertainment's Carrie Patel
Carrie Patel, a game director and senior narrative designer at Obsidian Entertainment, outlines her approach to narrative design and game development, drawing on her experience with the Pillars of Eternity and The Outer Worlds franchises.
- Obsidian Entertainment integrates narrative design early in the development process, with writers and narrative designers serving as the same role to ensure world-building and systemic elements like item descriptions remain cohesive.
- When designing open-world RPGs, developers must account for diverse player psychographics—specifically those who prioritize combat, exploration, or deep character-driven storytelling—by providing multiple ways to engage with content.
- Narrative structure in open-world games cannot rely on a rigid three-act model because players may skip intended story beats; designers must instead focus on high-level narrative phases that remain engaging regardless of the order in which players encounter them.
