A New Tide – Square Enix Restructure: Multiplatform Push and Layoffs
Square Enix is a beloved publisher. It is one that everyone has their eye on. From the many fantasies that aren’t quite final, exploring Disney-filled kingdoms and seeing oceans of stars.
The publisher has done so much and in recent years, Square Enix has made many mistakes. A majority of that stems from horrible mismanagement of it’s former western teams but as of late, a major criticism is exclusivity. Pillar Final Fantasy titles like FFVII: Remake and FFXVI were PlayStation exclusive, with said games having massive budgets.
Other failings in the East, such as Forspoken don’t help matters either. Through having a new president and making public promises with Xbox, the publisher is set to open the JRPG waves. However, joining a positive push is yet another round of painful layoffs in the gaming industry.
Square Enix Laying off US and EU Teams
Reported by Video Games Chronicle, Square told staff across it’s western teams they would laid off.
According to people who were in attendance, Square Enix president Takashi Kiryu said that both the company’s American and European arms would be hit with layoffs, which will happen over the course of the next month.
The scale of the layoffs wasn’t shared, but staff were told that people working in publishing, IT, and Square Enix’s Collective indie games division will be predominantly affected.
Those impacted will be informed this week, staff were told. In the UK, employees will enter into a one-month consultancy period, as per local employment law, while US-based staff could leave their roles before June.
This is all in part of rebuilding the western division to support AAA projects and other ‘HD’ titles from their Japanese studios.
The layoffs coincided with the publication of the company’s quarterly financial results today, in which Square Enix said it plans to “rebuild overseas business divisions from the ground up” and has “begun optimizing costs at its European and American offices via structural reforms”.
Failings in the West
This isn’t the first time Square Enix ‘shed the fat’ within their western teams. Back in May 2022, the publisher sold their western studios to the Embracer Group, which itself suffered major layoffs.
Embracer Group AB (”Embracer”) has entered into an agreement to acquire the development studios Crystal Dynamics, Eidos-Montréal, Square Enix Montréal, and a catalogue of IPs including Tomb Raider, Deus Ex, Thief, Legacy of Kain and more than 50 back-catalogue games from SQUARE ENIX HOLDINGS CO., LTD. (“Square Enix Holdings”).
The reasoning for selling off their western teams merely two years ago? They said the following according to Eurogamer;
Square Enix said the sale to Embracer “enables the launch of new businesses by moving forward with investments in fields including blockchain, AI, and the cloud”.
This statement has not aged well, with all but one of these initiatives still active within the company. Two years after this decision, the companies efforts in the west have been minimal.
Square Enix Collective
The program launched back in 2013 and expanded in 2016, with their efforts resulting games like Power Wash Simulator.
First announced in 2013, Collective began life as a website launched in 2014 dedicated to helping indie developers build an audience for their games by tapping into the wider Square Enix community via a pitching platform.
Subsequently we worked on sense-checking Kickstarter campaigns and supporting them with awareness-building, helping a number of teams to raise over $1.2m in total. Collective’s first published project was released in 2016, and by the start of 2020 we have published 12 games on multiple platforms, including Battalion 1944, The Turing Test and Forgotton Anne.
This sector of the company was impacted by the layoffs, not unlike the recent Take Two layoffs heavily downsizing Private Division.
Multiplatform Expansion
A major reason for these moves, starting as early as July 2023 with the announcement of Final Fantasy XIV releasing on Xbox platforms, is bring games to more places.
After years of signing on exclusivity contracts with PlayStation and Nintendo for releases large and small, the publisher wants to have an approach not unlike SEGA/Atlus. They have said the following on the matter according to Video Games Chronicle;
One of the four pillars of this plan, which involves “strengthening customer contact points”, will see the publisher “shift to a multiplatform strategy”.
The plan says Square Enix will “aggressively pursue a multiplatform strategy that includes Nintendo platforms, PlayStation, Xbox and PCs”.
By doing this, it will be able to “build an environment where more customers can enjoy our titles in regards to major franchises and AAA titles, including catalogue titles”.
The Switch 2 Effect
Considering reports that the upcoming Nintendo platform will have specs rivaling a Xbox Series S, that platform is a major reason for this push.
While potential sales on Xbox platforms and day-and-date PC launches clearly are a factor. Nintendo Switch dominates in Japan and as their home region, sales there are paramount.
Specifically, for the Final Fantasy franchise. As the series grew larger and more expensive, it prevented itself from releasing on Nintendo’s under-powered platform outside of spin-off titles. Having better hardware, Final Fantasy and Kingdom Hearts can join the likes of Octopath Traveler and Bravely Default.
Partnership with Xbox
Despite recent events, deals are place with the console maker/publisher regarding Japanese developed content. And with Final Fantasy XIV releasing on the platform to modest success, more titles will surely follow.
While the Final Fantasy VII: Remake trilogy might be off the table due to contracts with PlayStation, a game like Final Fantasy XVI is ripe for a multiplatform launch. The game is content complete, more so now with the two DLC expansions released. And with a PC launch on the horizon, having a Xbox SKU ready for launch would be ideal.
Also worth noting, if the Switch 2 has specs similar to a Series S, the work done optimizing the game for the Xbox Series S could greatly help in getting the game ready for Nintendo’s upcoming console.
Subscription Services
With the Final Fantasy series slowly leaving PlayStation Plus Tiers in recent months, this multiplatform push could also extend to deals for other services. This doesn’t just include the great potential of Game Pass getting the entire FF series, but it also could include Nintendo’s Switch Online as well.
While that platform isn’t known for retail games coming to the service. Square Enix has a great history across the NES all the way through the Game Boy Advance, all platforms currently supported on Switch Online.
Microsoft and Rare brought more games to Switch Online across Nintendo 64, NES and SNES. So it’s likely possible with this multiplatform push, contracts will be more liberal for services like these.
Closing Thoughts on the Square Enix Layoffs
As someone who loved games from Square Enix like Final Fantasy XVI and Kingdom Hearts 3, I am beyond excited seeing their bigger efforts going to more platforms. The more eyes on your game, the higher potential for sales and with that being such a critical factor in this dangerous time in gaming, Square Enix clearly wants that.
Despite the critical success of their PS5 efforts, Final Fantasy being locked to PlayStation has resulted in lower sales numbers than either Square or Sony expected. So trying to recoup those losses with not only post-launch ports but day-and-date launches for future titles? It’s a smart decision from the publisher.
But as someone who very vocally voiced his displeasure at Tango Gameworks closure, I must criticize Square Enix for joining in the sea of layoffs in this industry. While it may make sense on a business level, it is not fair to the talented people that helped support the company.
Thankfully, it seems that studios aren’t shuttered like Xbox’s horrific layoffs but that doesn’t make this any better. As an industry, publishers need to do better for the people making content for them.
