Amazon Game Studio Layoffs Hint at Long-Running Issues

Amazon has reportedly laid off dozens of employees in its game division.

According to Kotaku, the gaming blog that broke the story, these employees were told late last week that they have 60 days to find new jobs within Amazon or they’ll be asked to leave. The blog’s source also said that Amazon has canceled some of its in-development games.

Amazon later confirmed the news, with a spokesperson stating: “Amazon Game Studios is reorganizing some of our teams to allow us to prioritize development of New WorldCrucible, and new unannounced projects we’re excited to reveal in the future.” It stated these shifts are “the result of regular business planning cycles where we align resources to match evolving, long-range priorities.”

Nonetheless, Amazon Game Studios hasn’t exactly emerged as an existential threat to other gaming firms, which might have something to do with its failure to launch any blockbuster games. Indeed, Amazon’s most notable gaming product is arguably Lumberyard, the cross-platform 3D game engine designed to leverage the storage and computation offerings of the AWS (Amazon Web Services) cloud, but even that hasn’t managed to make much of a dent against well-established game engines such as Unreal Engine.

Amazon also owns Twitch, which allows gamers to stream their gaming footage, and reportedly has plans for a service that allows gamers to play streaming games via the Web (which would put it in competition with Google Stadia).

In other words, Amazon has assembled all the pieces for a gaming ecosystem that could robustly challenge other firms. It has substantial cloud assets, at least one brand beloved to gamers (Twitch), a developer platform, and a storefront it can use to push any gaming-related hardware and software it wants. So why hasn’t the company made a bigger splash among gamers?

The answer is, simply, a lack of games. And dismissing dozens of developers won’t exactly help on that front. For tech professionals, there’s perhaps something oddly comforting in Amazon’s lack of progress, because it reinforces the idea that even companies with enormous resources can’t make much headway unless they have the right teams in place. You can have all the money in the world, but unless you have the right developers and professionals—guided by the right managers—chances are good that you won’t accomplish as much as you’d like.

Gaming is also very much a personality-driven subset of the tech industry, and although Amazon has attempted to hire some game directors with great track records (such as Kim Swift, who guided Portal, but who left before releasing a game), it hasn’t found someone to spearhead the next great game franchise.

Amazon can recover, of course. But this recent round of layoffs doesn’t bode well.