Unfortunately, the gaming industry has been showing its ugly side again recently when GOG fired around a dozen employees because of the financial problems. Apparently, the company was under financial struggle for months and this outcome was undesired, in a way it was expected. However, although GOG confirmed the layoffs, it didn’t state any reason for it but Kotaku got the info from one of the fired employees.
A digital distribution platform GOG is actually a subsidiary of CD Projekt Red you may know as the publisher behind the Witcher series and upcoming Cyberpunk 2077. GOG is a platform for selling DRM-free and commercial games for Microsoft Windows, Mac OS X and Linux, like Assassin’s Creed. And now, GOG has joined the series of layoffs in the gaming industry which really had the consumers and employees worried.
“Letting people go is never easy,” said GOG representative to Kotaku. “We have been rearranging certain teams since October 2018, affecting in closing around a dozen of positions last week. At the same time, since the process started we have welcomed nearly twice as many new team members, and currently, hold 20 open positions.”
An ex-employee fired last week told the website that things went bad really fast and that everything happened in the past few months. They also explained that revenue couldn’t follow the growth and this is why the store was really close to being in the red zone. However, this person pointed out that this is all very strange since, while February was a slow month, January was excellent. The company did do some restructuring but this magnitude of layoffs had surprised a lot of people.
One of the things that might have affected GOG’s revenue is the Epic Store’s 88% cut it offers to developers who sell their games through this platform. Both GOG and Steam offer 70% to developers which is a considerable difference from what Epic Store is offering. But this is far from being the Epic Store’s fault since other digital stored could have adjusted their terms towards developers in due time. On the other hand, their adjusting may require some cut downs in order to compensate for the difference in profit so this could also be a reason for the layoffs.
Until GOG comes forward and offers an explanation, we can only assume the reasons behind the financial troubles which caused the layoffs of a dozen people. After all, Activision Blizzard fired almost 800 people and ArenaNet did the same by laying off an unspecified number of employees just a few days ago. So, the gaming industry may have an epidemic of layoffs on its hands which clearly point out certain problems that were not addressed in time or in an appropriate fashion.
A dozen employees are 10% of GOG’s staff, so when you observe it that way, this is a substantial move from the digital store. Some believe that the failure of the latest CD Projekt Red game Gwent has something to do with financial troubles, but just like with the Epic Store theory, this is all speculation. Let’s just hope that this was it for layoffs in the gaming industry and that other companies will seriously take a look at their strategy and plans and try to keep its employee number steady.