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State of Decay 3 report details troubled development

And alleged failures at studio Undead Labs.

A new report has shed light behind the scenes of State of Decay 3, the upcoming open world zombie game from the Undead Labs.

Details published by Kotaku include allegations of sexism and mismanagement at the Microsoft-owned studio, and paint a picture of a game project which is still struggling to get off the ground years after its official reveal.

State of Decay 3 began pre-production in late 2018, though developers at Undead Labs were reportedly poorly-managed and the project took several team re-organisations to get off the ground. Staff have claimed the game's public announcement in 2020 was too early, and at that point Undead Labs "didn't even know what it was".

Microsoft announced State of Decay 3 in 2020, though the project still lacks a release date.

The report also alleges sexism - that female employees were ignored or blamed during meetings, and subject to sexist remarks - as well as failures by HR. Rules on meeting etiquette reportedly had to be enforced, though did not solve these issues.

In 2018, when Undead Labs was bought by Microsoft, staff said the concern had been an enforced change of culture. Now, staff say Microsoft should have done more.

"We were afraid they would come in and change our culture," one staff member said, "but our collapse came from within and we could have used [Microsoft's] help."

The subsequent switchover from previous studio boss Jeff Strain to former ArenaNet exec Philip Holt as head of the company also caused friction, it was reported, as well as frustration over the company's allegedly ineffective new HR boss Anne Schlosser.

It was here, last summer, after several public testimonials of working conditions, that Microsoft apparently did step in. In September, Schlosser "quietly left". However, the damage has been done, and a wave of departures followed.

Holt's plans for internal demos of the game also caused problems, with staff departures and a lack of focus seeing plans eventually shifted at employee behest.

Employee opinion on the game now seems mixed - some say it has finally turned a corner, while others are more sceptical of how the project will continue with further departures and under the studio's current leadership.

"I recognise that some of our employees, current and former, have shared that their experiences at the Lab weren't always positive," Holt said in a statement issued in response. "Our past culture does not exemplify who we are now, nor who we want to become. We have seen a lot of change in the last few years: we have an entirely new leadership team, including new HR Director and department in 2021; hired about 75 employees since the beginning of the pandemic; and have transformed the demographic make-up of our team.

"We've already seen that our ongoing cultural transformation is creating a better workplace for the team, which leads to better games for our community. I am proud of the work we have done, humbled by the task in front of us, positioned to learn from this experience, and committed to doing better every day."

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State of Decay 2

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Tom Phillips


Tom is Eurogamer's Editor-in-Chief. He writes lots of news, some of the puns and makes sure we put the accent on Pokémon. Tom joined Eurogamer in 2010 following a stint running a Nintendo fansite, and still owns two GameCubes. He also still plays Pokémon Go every day.