Insomniac Facing Cuts Despite Huge Success, PlayStation May Close Another Studio

Amongst Sony’s stable of first-party PlayStation Studios developers, none shine brighter than Insomniac Games, which has produced hit after hit without the excessively-long development schedules that are increasingly becoming the norm in the AAA gaming space. The recent leak of Insomniac’s upcoming slate lays bare just how heavily Sony relies on them, with at least six titles planned for the next decade, most of which will likely sell 10s of millions of copies.

Given Insomniac’s performance, you’d think Sony would be willing to give them all the resources they need, but it seems that’s not the case. Kotaku’s Ethan Gach dug into internal documents from the Insomniac leak, and found the studio is actually under surprising pressure from Sony higher-ups to get costs down. Marvel’s Spider-Man 2 cost around $300 million to produce, around three times the $100 million budget of Insomniac’s first Spider-Man game. Insomniac’s brass expresses concern about costs ballooning further, saying future major games must be made for $350 million or less, which actually means reducing budgets when you take inflation into account.

Recent communications also indicate Insomniac is under pressure to keep their headcount down. Earlier this year, the studio projected it would surpass 500 employees, but in September Sony issued the directive that headcount couldn’t exceed 470 people, and later documents from November indicates Insomniac is looking to “remove 50-75 people strategically.” A plan to “slim down” a future Ratchet & Clank game and new IP are rejected, with Insomniac brass saying cuts would need to be made from the larger Wolverine and Spider-Man teams, with some from the Ratchet and new IP teams used to fill gaps.

Interestingly, amongst all this talk of cost-cutting, Insomniac mentions that other teams under the PlayStation umbrella are being hit and that “there will be one studio closure.” Whether that actually happens remains to be seen.

How Sony has found themselves in the position of needing to make these cuts is somewhat difficult to understand considering the success of PS5 and most of their games, but business is business I guess. More baffling is Insomniac in particular being targeted when they’re the most productive, efficient, and by most accounts, healthiest studio operating under the PlayStation banner. They’ve figured out the formula, and I have no idea why you’d risk messing with it, particularly when you expect them to produce a half-dozen games for you over the next decade. That doesn’t feel like smart business to me.

What are your thoughts on Insomniac’s future? Can they deliver their ambitious slate of games? Will Sony sour a good thing with their penny-pinching?

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