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The sinking ship known as 38 Studios, the game company owned by the former Red Sox pitcher Curt Schilling, has laid off all of its employees this past week. This places nearly 400 people out of a job.
38 Studios was given a $75 million loan guarantee from Rhode Island back in 2010 to move operations from Maynard to Providence. Unable to keep up with the $1.1 million payments, the company requested even more funding to stay alive. On May 15th, the fund well ran completely dry and the company was unable to pay their entire payroll prompting the loss of their chief executive and "another top official".
The company has spent years and tons of money developing a new MMO that will probably never see the light of day at this point. The company did develop and release Kingdoms of Amalur: Reckoning, which was a dud amongst gamers despite its quite positive review scores.
Rhode Island has already paid $49 million of the promised $75 million loan to the studio. Despite the company being on the verge of a total meltdown, the tax payers in the state will still have to continue paying towards the remaining amount, including extra for interest.
(via)
38 Studios was given a $75 million loan guarantee from Rhode Island back in 2010 to move operations from Maynard to Providence. Unable to keep up with the $1.1 million payments, the company requested even more funding to stay alive. On May 15th, the fund well ran completely dry and the company was unable to pay their entire payroll prompting the loss of their chief executive and "another top official".
“It’s an unfolding tragedy here in Rhode Island,” said Rhode Island Governor Lincoln Chafee in an interview in Providence.
Chafee said that Schilling’s plea for more aid from the Rhode Island Economic Development Corp., which administers the loan guarantees to 38 Studios, fell short. “There was a feeling that we needed to be sold,” he said, but Schilling failed to supply a workable business plan with a legitimate chance of success.
The political fallout continued in Rhode Island, as a member of the EDC board resigned Thursday and, Chafee said, two other members whose terms had expired asked not to be reappointed.
Schilling’s company did not inform the governor’s office about the mass layoff. Chafee said the state hasn’t been able to confirm how many workers were let go. State officials have also struggled to get other critical details since 38 Studios ran into financial trouble.
“Communication has been very difficult,” Chafee said. “It’s come to the point where we have to verify what we hear.”
Chafee said that Schilling’s plea for more aid from the Rhode Island Economic Development Corp., which administers the loan guarantees to 38 Studios, fell short. “There was a feeling that we needed to be sold,” he said, but Schilling failed to supply a workable business plan with a legitimate chance of success.
The political fallout continued in Rhode Island, as a member of the EDC board resigned Thursday and, Chafee said, two other members whose terms had expired asked not to be reappointed.
Schilling’s company did not inform the governor’s office about the mass layoff. Chafee said the state hasn’t been able to confirm how many workers were let go. State officials have also struggled to get other critical details since 38 Studios ran into financial trouble.
“Communication has been very difficult,” Chafee said. “It’s come to the point where we have to verify what we hear.”
The company has spent years and tons of money developing a new MMO that will probably never see the light of day at this point. The company did develop and release Kingdoms of Amalur: Reckoning, which was a dud amongst gamers despite its quite positive review scores.
Rhode Island has already paid $49 million of the promised $75 million loan to the studio. Despite the company being on the verge of a total meltdown, the tax payers in the state will still have to continue paying towards the remaining amount, including extra for interest.
(via)
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