I've come to decide that there's nothing wrong with an loudmouth conservative like Schilling taking government hand outs....The system (a Schilling would say) is rotten, and the capitalist has to work with that.

Starve the beast Curt! Starve it and drown it in a bathtub!

One former employee said they discovered this week that their Massachusetts home, which they had been told was sold last year, actually hadn't been. The bank contacted them this week to ask why they mortgage wasn't being paid.

Awesome. This is going to be a great TV movie. Somebody get Brian Dennehy on the phone.

I don't know about video games reviews, I remember Final Fantasy XIII trying something new especially with their combat system, and all anybody could talk about was how linear the story line was. When XIII-2 came out, all anybody could talk about was how open spaced it was and why they didn't like it. And reviews for fighting games in general seem on the low side, getting only 3/5 lately. Just read recent reviews of Soul Calibur V or Street FighterxTekken. Just about everyone had a field day with the DLC controversy with SFxT.

I can certainly understand where people wanting GTA set in the 40s would be heavily disappointed by it though.

For me it the story line was too linear, and it had a random plot twist in the middle of the arc that made no sense. I don't need total sandbox, but it had very little of it when it easily could have had a lot, and not much else to offer. The free roaming was boring and the side quests were limited.

On the plus side the facial animation looked great.

One former employee said they discovered this week that their Massachusetts home, which they had been told was sold last year, actually hadn’t been. The bank contacted them this week to ask why they mortgage wasn’t being paid.

Is Schilling going to have a towel over his head during the court proceedings for this?

If true, that's got to be some kind of illegal.

If true, and a part of the contract, it's a breach of contract. The problem being how to get blood out of the stone that's now 38 Studios's remaining assets. They'd probably end up below whatever secured creditors there are.

FFXIII's real problem was that it simply wasn't very good at the start. The combat system could have been amazing and it still would have gotten hammered for being deeply annoying to play outside of the combat.

Starve the beast Curt! Starve it and drown it in a bathtub!

Curt's never struck me so much as a Grover Norquist type absolutist so much as your basic Republican partisan. To my knowledge he hasn't advocated eliminating vast swathes of the federal government.

Is Schilling going to have a towel over his head during the court proceedings for this?

Schilling probably won't even be in court. 38 Studios is an LLC, so unless I'm missing something the most he'd come in for is a deposition.

I will always be grateful to Schilling for 2004, but I think there's a lot more to this than just "sometimes startups fail". I think that 1) their plan was an overreach from the start, 2) they should have seen this coming and laid off half the company six months ago, and 3) they seem to have totally screwed over their employees (e.g., not telling them that their insurance ran out weeks ago). Failing is a large possibility when you're a startup, but you can handle it with a lot more grace than this. And I get the impression that Schilling etc. never took the possibility seriously that they might actually fail, which caused a lot of this mess.

(I work in the video game industry, for what it's worth.)

People like "Heavy Rain?" I'm kind of surprised. After I finished L.A. Noire, I was kind of enthused by the style of game so I looked around online for what else was available in that general style. "Heavy Rain" seemed to be the best reviewed and when I was talking to my brother, he mentioned that he had it but had not played it much because it was terrible and boring. I could understand feeling that way about a game like that if you weren't in the right mood the first time you played it so I asked him to fire it up the next time I was at his house. He did, and we played it for maybe 3 hours without anything happening. It was just weird that somebody felt a game built solely around QTEs would be compelling. Maybe it gets better but how did anybody have the patience to find out?

Heavy Rain does get better after the first couple of hours.

I wouldn't say that it is an entirely successful experiment, but I'm glad that people are exploring that path.

I think that #1 and #2 can both fall under the "sometimes startups fail" rubric. I also think we're generally underestimating the number of new businesses in general that fail. According to this
NYTimes post nearly 50% of new companies are dead by age 5. Schilling founded 38 Studios in 2006, so it actually beat those odds. According to the link, the stats remain fairly constant across cohorts and sectors, though video game developers may differ, and I'm not sure if there are differences based upon total capitalization. AFAIK people have said that Schilling's investment was 20-30 million of his own money. I don't know what other groups or individuals contributed a capital stake.* So, given that we don't have any evidence to the contrary, we shouldn't be surprised that 38 Studios failed- 6 in 10 of all new companies from 1992 died by year 6. And that was in the midst of a strong economy rather than what we have now.

ETA: If the number given here is accurate, then 95% of tech startups will fail. But there's no time horizon given for that number.

I also think that #3 is a part and parcel of working at a startup- you generally have to pay more to get the same level of talent because of the risks involved. And I highly doubt that it was a huge surprise to the employees of the company that they were in dire financial straits, the health of the company is something that tends to be a common topic of conversation at even established firms. And as for the workers landing on their feet- some will do better than others. But Turbine held a hiring day right by 38 Studios in Rhode Island a week or so ago, I'd assume a lot of the talent is getting poached. I'd call that part of it just how business works. The whole lying to employees about selling their house is a whole other ball of wax.

ETA: This argues that the main cause of internet company failure is premature scaling. Which would certainly seem to be the case for 38 Studios as well. They got too big a payroll before they had the revenues and base to handle it. Again, far less "gross mismanagement" or Curt Schilling actively being a terrible company founder and blowing all his cash on toys, movie-tie ins, and the other twaddle SSD was having the vapors about than simply one of the big risks of starting a company.

I really need to get around to playing Heavy Rain and LA Noire. I've been waiting for games to get past using combat as their main form of interaction for a long time. Even games that make good faith efforts towards that are a step in the right direction. Fewer Call of Duties and more Mirror's Edge's please.

* Remember that the 75 million dollar loan from Rhode Island is not the same as capital investment, the reason 38 Studios fell apart was because it couldn't make that loan payment.

Heavy Rain does get better after the first couple of hours.

I wouldn't say that it is an entirely successful experiment, but I'm glad that people are exploring that path.

Agreed. It will serve as a nice stepping stone for future ambitious studios. It was good enough for me to enjoy it (and my wife as the audience/back seat gamer).


BTW, there is a Walking Dead game in the "Heavy Rain" style that is on PSN, XBL, and PC. It will be released in episodic format all summer, 5 in total. Episode 1 is available now and there is a demo on the PSN (not sure about other platforms). The Demo was short, but very intriguing. The story starts right when sh*t hits the fan and it's an adjacent story to the one told in the comics & tv show, with a few overlapping characters.

I wouldn't say that it is an entirely successful experiment, but I'm glad that people are exploring that path.

It's funny, I was going to say almost exactly this about L.A. Noire but instead I was distracted by the Heavy Rain talk. I'm glad people are trying different things too and I don't think it's fair to hold every game to the same standards in terms of replayability or length or whatever. I just thought Heavy Rain was boring.

I also think that #3 is a part and parcel of working at a startup- you generally have to pay more to get the same level of talent because of the risks involved. And I highly doubt that it was a huge surprise to the employees of the company that they were in dire financial straits, the health of the company is something that tends to be a common topic of conversation at even established firms. And as for the workers landing on their feet- some will do better than others. But Turbine held a hiring day right by 38 Studios in Rhode Island a week or so ago, I'd assume a lot of the talent is getting poached. I'd call that part of it just how business works. The whole lying to employees about selling their house is a whole other ball of wax.

According to this Joystiq article, most of the employees still thought their jobs were going to be there, even by this week. Apparently, it caught everyone at the company by surprise.

This quote is pretty telling:

I wasn't alone in finding the reactions of these employees odd. A contact emailed me about one of her friends at the developer: "I have to get this off my chest. Watching the 38 Studios thing unfold has been like watching a friend stay in an abusive relationship and say, 'Well, he doesn't really mean it when he hits me' and then when he leaves and takes everything, they say, 'Thanks for the good times!'"

According to this Joystiq article, most of the employees still thought their jobs were going to be there, even by this week. Apparently, it caught everyone at the company by surprise.

Wow, that's surprising to me. That makes it suck even more.

It's funny, I was going to say almost exactly this about L.A. Noire but instead I was distracted by the Heavy Rain talk. I'm glad people are trying different things too and I don't think it's fair to hold every game to the same standards in terms of replayability or length or whatever. I just thought Heavy Rain was boring.

To be clear, I thought the concept behind L.A. Noire was good and interesting, but the execution stunk. I'm not holding it to the standard of say, Red Dead Redemption, but it was one of the weakest games I've ever bought.

There wouldn't have been any reason to make the loan payment if Schilling didn't have hope that he could get thinks to work out. I'm guessing that he thought he could get the tax credits that the company was eligible for and that would keep things afloat until the game launched, or at least for a good period until he could maybe get some more investment to get them to the finish line. Once the governor started saying he wouldn't issue credits to the company, he made the decision to pull the plug. I guess that's the most generous reading of what might have happened. It's also possible that with the CEO out, nobody was really in charge and had a full understanding of what was happening.

Heavy Rain might be my favourite PS3 game. I've never played a video game that immerses you like that before. It didn't hurt that it was gorgeous.

ETA: This argues that the main cause of internet company failure is premature scaling. Which would certainly seem to be the case for 38 Studios as well. They got too big a payroll before they had the revenues and base to handle it.

Maybe so, but you almost never see a company run full speed into a brick wall and just disappear in a matter of days from the first sign of trouble, most see it coming, Lifetime=Cash/Burnrate is not a hard equation to grasp. The denial must have been strong at 38 Studios.

Yeah, usually there is a 10% downsizing, then a 50% downsizing, then ... blub... blub. Game studios might be different because they are usually high-capital single product ventures. If they had cut payroll 10% a year ago, or 50% 6 months ago, they might have delayed their inability to make payments... but they are still screwed if they can't get their game out.

@119 - I you have to put in a "projected revenues" term in your equation there -- possibly they just thought that their released game would do (much?) better.

ETA: This argues that the main cause of internet company failure is premature scaling. Which would certainly seem to be the case for 38 Studios as well. They got too big a payroll before they had the revenues and base to handle it. Again, far less "gross mismanagement" or Curt Schilling actively being a terrible company founder and blowing all his cash on toys, movie-tie ins, and the other twaddle SSD was having the vapors about than simply one of the big risks of starting a company.

But it's a risk that can be mitigated. As #119 points out, you look at your cash and burn rate and plan accordingly. I've worked for startup biotechs that were far, far more capitalized than 38 Studios ever was, and none of them got anywhere near 379 employees. (In fairness, that's apples to oranges, but the point is, those biotechs were very careful about headcount and expanding.)

Not saying it was because Schilling was a blowhard (which he is), or because of any of that nonsense. I don't know who made the strategic decisions. But whoever did probably missed the most-small-businesses-die-from-overexpansion lecture in business school.