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Schell Games has confirmed layoffs affecting 10% of its staff, approximately 15 employees, due to industry shifts and the need to re-balance project focus. The studio emphasizes its ongoing commitment to VR and new projects.
Schell Games, a veteran virtual reality (VR) studio known for titles like I Expect You to Die and Among Us VR, confirmed it has laid off approximately 10 percent of its staff. The layoffs, first reported by Game Developer and confirmed by the studio’s CEO, Jesse Schell, are the company’s first in over 20 years. This development underscores ongoing challenges in the VR industry and signals a strategic shift for the studio.
According to Jesse Schell, the studio’s CEO, the layoffs have affected about 125 employees. Schell stated, “We found it necessary to do a 10% layoff for rebalancing purposes,” emphasizing the difficulty of the decision. The studio had been working on a smaller number of larger titles but is now shifting toward more projects with smaller scope to ensure sustainability amid industry turbulence.
Schell also mentioned that VR remains a significant part of their work, with a new VR title in production and proposals for additional projects. While VR once constituted 80% of their work, that figure has now decreased to around 30%, with increased focus on VR-adjacent sectors like interactive projection for location-based entertainment. The company maintains its commitment to VR, despite the broader industry contraction.
Implications of the First Major Layoffs in 20 Years
This announcement marks a notable shift for Schell Games, a company with a long history of supporting VR development. The layoffs highlight the ongoing struggles within the VR industry, especially following recent closures of other VR-focused studios and cancellations of high-profile projects. For the broader industry, it signals a potential consolidation or realignment as companies adapt to changing market conditions and funding environments. The decision also reflects a strategic pivot toward smaller, more numerous projects, which could influence the future direction of VR content creation.
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Industry Challenges and Recent VR Studio Closures
Schell Games has operated for over 24 years, building a reputation for successful VR titles like the I Expect You to Die trilogy and Among Us VR. However, the VR sector has faced significant upheaval in recent months. Meta’s widespread VR studio closures earlier this year led to project cancellations, including an unannounced Batman: Arkham Shadow sequel and a Harry Potter VR game. Other studios, such as Survios and Vertigo Studios, have shut down entirely, reflecting a broader contraction in VR development funding and interest.
Despite these challenges, Schell remains committed to VR, with ongoing projects and proposals. The studio’s shift toward smaller projects aligns with industry trends, as many developers seek sustainable models in a difficult funding environment.
“Unfortunately, we found it necessary to do a 10% layoff for rebalancing purposes.”
— Jesse Schell
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Unclear Impact on Future VR Projects
It is not yet clear how these layoffs will influence Schell Games’ upcoming VR titles or their overall strategic direction long-term. The studio states it remains committed to VR and has ongoing projects, but the full impact of the staff reduction on project timelines and innovation remains uncertain. Additionally, broader industry trends suggest potential further shifts, but specifics are not yet confirmed.
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Next Steps for Schell Games and Industry Recovery
Schell Games is expected to continue development of its current VR projects and explore new opportunities in VR-adjacent sectors. The studio has indicated plans to adapt to the changing market by focusing on smaller, more numerous projects. Industry analysts will be watching for how the company navigates these changes and whether other studios follow similar strategies. Further announcements regarding new titles or strategic shifts are anticipated in the coming months.
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Key Questions
How many employees did Schell Games lay off?
The studio laid off approximately 10% of its staff, which amounts to about 15 employees based on current staffing levels.
Why did Schell Games decide to lay off staff now?
The CEO cited the need to rebalance the company’s focus and ensure sustainability amid industry challenges, including shifts in VR market demand and project funding.
Will Schell Games continue developing VR titles?
Yes, the company confirmed it has a new VR title in production and proposals for additional projects, maintaining its commitment to VR development.
How does this affect the future of VR gaming?
The layoffs reflect broader industry struggles and a possible shift toward smaller, more sustainable projects. It signals a period of adjustment for VR developers, but the long-term impact remains uncertain.
Are other VR studios experiencing similar issues?
Yes, several other VR studios, including Survios and Vertigo Studios, have shut down recently, and many high-profile projects have been canceled, indicating industry-wide difficulties.
Source: Road to VR
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