UK-based games development studio Mediatonic, the creators of popular battle royale party game Fall Guys, has been hit hard by Epic Games’ layoffs.
Epic Games CEO Tim Sweeney emailed staff yesterday saying the company is laying off 16% of its workforce – around 830 people.
The US-based company has around 40 offices worldwide, including offices in the UK, such as in London, Manchester, Leamington Spa, Newcastle, Guildford and Edinburgh, according to data from June 2023 sent to the House of Lords. Epic Games previously employed more than 900 people in the UK up until this week.
Several Epic Games staff in the UK have been laid off, as have staff at Mediatonic.
Rocket League caster Stax also explained that RLCS talent aren’t being laid off as they’re independent contractors.
Charlie Tizard, who is based in Epic’s Berlin office and has worked for several companies in UK esports including NSE, Multiplay/Insomnia, Belong and more, was also affected.
And former Mediatonic dev Ed Fear tweeted the following image out, featuring the Mediatonic letters rearranged as an anagram to spell ‘Decimation’.
Epic Games acquired Tonic Games Group, makers of Fall Guys, back in 2021. Mediatonic has its headquarters in London, plus offices in Brighton, Leamington and Madrid.
Epic Games publishes Fortnite, and owns Rocket League dev Psyonix, Rock Band dev Harmonix and Fall Guys dev Mediatonic among others. Fortnite and Rocket League of course have their own professional esports scenes.
CEO Tim Sweeney said two-thirds of the layoffs were in teams outside of core development, and explained the reasoning behind the layoffs.
“For a while now, we’ve been spending way more money than we earn, investing in the next evolution of Epic and growing Fortnite as a metaverse-inspired ecosystem for creators,” he said. “I had long been optimistic that we could power through this transition without layoffs, but in retrospect I see that this was unrealistic.
“While Fortnite is starting to grow again, the growth is driven primarily by creator content with significant revenue sharing, and this is a lower margin business than we had when Fortnite Battle Royale took off and began funding our expansion. Success with the creator ecosystem is a great achievement, but it means a major structural change to our economics.”
Tim Sweeney, Epic Games
“Epic folks around the world have been making ongoing efforts to reduce costs, including moving to net zero hiring and cutting operating spend on things like marketing and events. But we still ended up far short of financial sustainability. We concluded that layoffs are the only way, and that doing them now and on this scale will stabilise our finances.”
“We’re cutting costs without breaking development or our core lines of businesses so we can continue to focus on our ambitious plans. About two-thirds of the layoffs were in teams outside of core development.”
Tim added that Epic Games is still focused on Fortnite, Rocket League, Fall Guys and more.
He also said there will be no more layoffs as ‘these changes financially stabilise the business’.
Sega cancels Creative Assembly’s squad shooter Hyenas as job losses loom
Elsewhere, Sega has made the decision to end development of Hyenas at UK studio Creative Assembly.
Hyenas was a heist-focused team hero shooter, and its cancellation has also resulted in job losses at the company.
UK Rainbow Six Siege pro player, LeonGids, was upset to see the game get cancelled:
Sega said in a financial update: “In response to the lower profitability of the European region, we have reviewed the title portfolio of each development base in Europe and the resulting action will be to cancel Hyenas and some unannounced titles under development. Accordingly, we will implement a write-down of work-in-progress for titles under development.
“We will implement reduction of various fixed expenses at several group companies in relevant region, centered on the Creative Assembly Ltd. We expect to incur one-time expenses related to reduction of fixed expenses.”
Dom is an award-winning writer and finalist of the Esports Journalist of the Year 2023 award. He graduated from Bournemouth University with a 2:1 degree in Multi-Media Journalism in 2007.
As a long-time gamer having first picked up the NES controller in the late ’80s, he has written for a range of publications including GamesTM, Nintendo Official Magazine, industry publication MCV and others. He worked as head of content for the British Esports Federation up until February 2021, when he stepped back to work full-time on Esports News UK and offer esports consultancy and freelance services. Note: Dom still produces the British Esports newsletter on a freelance basis, so our coverage of British Esports is always kept simple – usually just covering the occasional press release – because of this conflict of interest.
