This morning the 23-year-old UK developer Blitz ceased trading, resulting in the loss of some 175 jobs.
It's a sad end to one of the UK's most respected studios and, despite the hope that 50 jobs may be saved as part of a new company, a blow to British game development and in particular the Leamington developer community.
In a statement Blitz Games Studios co-founder and CEO Philip Oliver blamed the "global economic crisis" for the company's troubles, but the truth is much more complicated. Here, in an interview with Eurogamer conducted just a few hours after the Dizzy co-creator broke the bad news to his staff, Philip Oliver gives his side of the Blitz closure story.
Why has this happened now?
Philip Oliver: It's a run of bad luck. It's a little bit being let down by clients. But in some ways the biggest thing is there's a shifting industry. We're going from the boxed games to digital. We've had too big a gap between the consoles. That's not helped. We are a very large company in the middle of the market, which wasn't the place to be. THQ was a major client of ours for 10 years, and when you lose a client that gives most of your work, you have to quickly find new clients. To a certain extent we did. Finding Disney and doing Epic Mickey 2 was an awesome project. We'll always be very proud of that and working with people like Warren Spector. But unfortunately even Disney itself isn't doing that many of those kinds of games any more.
You mentioned that you have a couple of current projects that are self-sustaining financially. What are those exactly?
Philip Oliver: I can't give you the names of the clients or the names of the projects, but they're both very good clients. They've been incredibly supportive all throughout. One of them in particular has known our financial problems for a few weeks. They're so supportive. It's off the back of their behaviour that we're able to hopefully form a new company and give a substantial number of jobs to people.
"THQ was a major client of ours for 10 years, and when you lose a client that gives most of your work, you have to quickly find new clients."
Blitz Games Studios co-founder and CEO Philip Oliver
You're looking at re-employing 50 people?
Philip Oliver: Approximately, yes. That's the number of people we have spoken to today to say we'd like to offer them positions. It's obviously up to them whether they'd like to take them. I've had an awful lot of yes and please, yes.
If it creates some vacancies where some people turn that down then we will then move to the next tier and offer some more jobs to people we unfortunately had to let go today.
When did you know there would be no chance of Blitz continuing? What was the cut off point?
Philip Oliver: It's been financially difficult for the last year or so, but there have been lots of areas of hope. We've even been talking to investors. There have been some big possible contracts. Basically, we've been trying to stay in there, supporting it with some personal savings.
But about two weeks ago one of the big deals we were hoping to do got pushed off three months. The company said, we can't commit for another few months now. I guess that was the point when we said, we can't wait. We have to act now. It would be wrong for us to continue trading. So yeah.
It was decided a couple of weeks ago. In that last couple of weeks we've been doing our best to put together this new company to hopefully save 50 jobs. And obviously go through this procedure as kindly as possible to those people who are losing jobs.
Today you had to break the difficult news to your staff.
Philip Oliver: There have been a lot of tears. There have been a lot of man tears, too. I was expecting a lot of the girls to be beside themselves, and they were. But there have been a lot of men crying, including me.
How did it happen?
Philip Oliver: Over the last few days we've taken various people to one side, the senior members of staff, and told a few of them either they've got jobs or they haven't got jobs, and what our plans are. They were the very senior staff.
This morning we had about an hour of telling the next tier, and mainly those ones who didn't have positions. And then the town hall meeting started initially with a small meeting - well, there were 50 people in the room so it wasn't that small - to say they've all been chosen, that we would like to offer them jobs. And then into a big open floor, big meeting with me standing on a step ladder basically addressing everybody with the sad news.
It wasn't an easy one to deliver, I have to say.
I can only imagine it was one of the most difficult things you've had to do in your career in games.
Philip Oliver: Yeah. I'd put it at the top.
"There have been a lot of men crying, including me."
Blitz lasted 23 years. Looking back, what would you say will be Blitz's legacy?
Philip Oliver: The people. They will spread around the industry. They're incredibly talented. I genuinely hope they will look back on Blitz with fondness and good times.
I won't say it's always been perfect here, but the majority, if not all of them, will say they had a good time here and overall they're richer for it.
What's your proudest achievement?
Philip Oliver: Oh lordy! To be a spokesperson for the industry. I helped set up Tiga. I helped set up this. I've given so many jobs to so many people. I've been doing Creative UK stuff recently. I've always tried to do the right and honourable thing at every step of the way. In fact, I don't think you'll find anybody in the industry who will have a bad word to say about me or about the business decisions we've had to take over the years.
Do you intend to run this new company yourself? What's your plan?
Philip Oliver: Drink whiskeys.
I need to take stock just for a few days - or at least a few hours. I'll be back in work tomorrow. I'll be doing emails to the early hours tonight, tomorrow, over the weekend, as always. Monday morning, I'm genuinely hoping we can with a smaller team resume some kind of normality and crack on with a couple of very exciting projects with some great people.
When I was standing among the 50 we're offering jobs to... I genuinely hope they join us. Obviously I'm very sad the others couldn't... Yeah...
Will you have to find new premises? How will it work logistically?
Philip Oliver: I'm not sure. We have a meeting with the landlord tomorrow. The landlord heard yesterday. He's coming in tomorrow. We've always been very good tenants. Exemplary tenants, I believe. He said we're the best tenants he's ever had. So I'm hopeful we can do a deal with him, but let's see. It would certainly be best for everybody.
One thing I've seen on Twitter in response to the news is the lack of tax breaks in the UK have played a part in Blitz's closure. What do you say to that?
Philip Oliver: In our press statement we put global economic climate and all that kind of stuff. For the last few years things have conspired against us, and I guess other countries being able to give substantial tax breaks has meant the UK industry has lost some contracts. We've lost a couple of contracts to places like Canada. And we've been told, your competitor has come in a lot cheaper than you, and they're based in a tax friendly state. It's why I've been pushing for tax breaks for so long.
I'm not going to blame it entirely on that. Would it have helped if it had come a few years ago? Yes. If it had been rushed through in April? I don't think it would have made a difference this time. But hopefully it will get through. It'll never be as generous as some places, like Canada.
I'm not going anywhere. I still have my health. We still have a new company going forward. And hopefully I'll be leading that charge alongside lots of others who are trying to push this through. For the sake of the UK industry I genuinely hope we can.
And if they want an example of market failure, which is what the EU seem to always want before they approve, then we can be a good example!