Square Enix comes clean on cuts and closure

The CEO of Square Enix Europe has braved a number of questions surrounding the publisher’s decision to cut staff at Io Interactive, virtually close a programming department at Beautiful Game Studios, and shut down operations at Eidos Hungary.

Phil Rogers sportingly took on all questions during the second half of his interview with Develop, though the first half of the Q&A session – in its broader context – was positive of the group’s recent successes and bold plans for the future.

The CEO confirmed for the first time that Square Enix had closed down its Eidos Hungary studio.

“We took the decision back in October,” he said, “and this all goes back to the broad strategy of focusing on games that are either first or best.”

Said Rogers: “We were pleased with Eidos Hungary [developer of the Battlestations series], but I think we realised that to be first or best in the RTS genre was going to be really challenging. It wasn’t necessarily something we were going to win.

“On the balance of all that we decided that we would focus elsewhere and not move forward with the Battlestations IP and Eidos Hungary.”

Rogers said that Square Enix had to look at its business from a new, global perspective.

He was asked why, based on claims heard by Develop, nearly the entire coding team at London-based Beautiful Game Studios was made redundant, while a new coding team was set up at Shanghai.

Again, Rogers took on the question:

“What happened was we looked at Championship Manager within the PC market and decided that actually we’re now best positioned to focus expand the brand in new ways.

“So the staff cuts was looking at our skills, looking at where we wanted to invest more, and where we felt we should invest less.”

Rogers assured that Beautiful Game Studios in London remained operational as a developer, despite the significant loss in coding staff.

“I think ‘development hub’ encompasses many things," he added.

"[Beautiful Game Studios] is more than just core programmers; it has a key design hub, it has a key research hub, I think those are the key components of what we consider as development, and we have a talented team that can take the franchise forward.

“I look at the situation from a broader axis than pure play programming skills. Research and design skills are critical for the studio.”

Rogers was also asked how many staff were recently made redundant at Copenhagen studio Io Interactive, following rumours that around 35 had been let go.

“Well we don’t disclose numbers but we did let a number of people go,” said Rogers.

“Io has been tremendously busy over the last two years, though looking at all our production schedules and how they overlap, [we] realised we had surpluses at that stage.”

He assured that the popular Denmark studio still has the capacity to build multiple projects.

Finally, asked whether more cuts should be anticipated, Rogers remained positive but – understandably in an industry in constant state of flux – couldn’t rule anything out.

“I don’t think right now I would use the word anticipate [in regards to more cuts],” he said.

“I would say that we are in a world of constant change. The industry used to work in this cycle where there would be these set function changes every four or five years.”

He continued: “There’s a prediction that the whole platform transition which will extend the current cycle to seven or eight years, but what we’re looking at today is an environment that is constantly shifting with new platforms.

“So, if you interpret change as looking at investment in new areas, then absolutely. I’m always looking at where we should be spending more time, and where can we partner with companies to do things that we don’t want to do ourselves anymore.

“In terms of that kind of change, yes these things are going to be constantly looked at. There’s nothing imminent on the horizon, but I think anyone in our industry today is got to look at all the opportunities that are emerging.”