Telltale Games Is Shutting Down
It was a sad and shocking announcement that sent waves through the industry. How could this have happened and what happens next?
Here’s what happened…
Telltale CEO and founder Kevin Bruner announces he is leaving the company. It is later reported that Bruner was forced out as he clashed with the company’s board of directors. Telltale’s other co-founder, Dan Connors, takes over as CEO.
Telltale hires former Zynga executive Pete Hawley to become the company’s next CEO. Before Zynga, Hawley was a production lead at Fable studio Lionhead, working alongside Peter Molyneux on that series from 1993 to 2003. He then spent time with Sony (2003-2005), then EA (2005 to 2010).
One of Hawley’s first major moves as CEO of Telltale is enacting a huge round of layoffs in which the company cut 25 percent of its workforce, which amounted to around 90 people at the time. The layoffs impacted “all divisions” at Telltale, and were part of Telltale’s ambition to become “more competitive as a developer and publisher”
Telltale’s CEO Pete Hawley talks to GamesBeat about the layoffs and the future of Telltale. He rejects the idea that Telltale is in trouble, stating he feels the company is in “really good shape.” The layoffs were necessarily to help Telltale succeed in the future, Hawley said at the time.
A deeply sourced report from The Verge alleges that Telltale operates under a culture of heavy, expected crunch pushed by toxic management. Among the many shocking claims in the report is that employees worked as many as 18 hours per day for weeks on end.
September 20, 2018:
According to Variety, Telltale management informs employees that its negotiations with media giant AMC for more funding were “going well,” with the company expected to complete the funding process in the coming weeks. There was also reportedly a deal being negotiated with South Korean mobile game giant Smilegate for more funding.
Smilegate and AMC both apparently leave negotiations with Telltale on Thursday, just hours before an eventful Friday. The reports offered no explanation for why AMC and Smilegate left negotiations on the same day. Variety previously reported that movie studio Lionsgate also decided to pull out of a financial deal with Telltale
September 21, 2018:
According to reports, Telltale Games holds a meeting where it informs more than 200 developers that they were losing their jobs right then and there. According to Variety, employees were given paper paychecks for pay through the end of the day. They reportedly were instructed to leave the building within 30 minutes (employees were allowed back in for a period of three hours on the following Monday to collect personal belongings). The affected staffers received no severance pay, and their health care cover reportedly only extended to the end of the month. Management told employees they should consider applying for unemployment benefits.
Former Telltale CEO Kevin Bruner writes a blog post on his personal website talking about how he clashed with Telltale’s board of directors about the future of the company. He shares no more information about what he and the board disagreed over. Telltale’s board of directors includes Lionsgate CEO Jon Feltheimer, former Electronic Arts CEO John Riccitiello, and others.
Telltale’s official statement explains that the company is undergoing a “majority studio closure,” with only around 25 people remaining on board to “fulfill the company’s obligations to its board and partners.” CEO Pete Hawley, who joined Telltale in September 2017, says it was an “incredibly difficult year” filled with “insurmountable challenges” for Telltale. He says he is proud of Telltale’s efforts, but at the end of the day, its efforts “did not translate to sales.”
Dan Connors, Telltale’s co-founder, tells Variety that Telltale had “no choice but to stop production” after it failed to close another round of financing to keep the company afloat. “Sadly, everyone was so focused on doing what was required to keep the company going that when the last potential partner backed out, there were no other options,” he said.
September 24, 2018:
One former Telltale employee, Vernie Roberts Jr., files a class-action lawsuit against Telltale for unpaid wages and benefits that he claims Telltale owes him and other affected staffers. Roberts Jr. claims Telltale violated California’s WARN Act, which states that an employer must provide 60 days written notice about a mass layoff. There are some exceptions to the federal WARN Act. Attorney Richard Hoeg, who is not working on the case, tells GameDaily that Telltale may be able to deem the situation an “unforeseeable business circumstance” to remain in compliance with the WARN Act. However, California a version of the WARN Act unique to the state that does not include the “unforeseeable business circumstance” clause.
Later that day….
Telltale Games announces that “multiple potential partners” expressed some level of interest in helping Telltale to complete and release The Walking Dead: The Final Season. The company shared no information about who these potential partners might be. Additionally, Telltale says it can make no promises about ever releasing Episodes Three and Four. Even if they are released, Telltale warns fans that they might only come out “in some form.”
Also on September 24, Netflix announced that it is evaluating its options to continue production on Telltale’s Stranger Things game with a different partner. The streaming giant also confirmed that it plans to go ahead with releasing Minecraft: Story Mode on Netflix as planned.
September 25, 2018:
The Walking Dead: The Final Season’s second episode launches as planned, but it’s not the only major development this day. The game’s $20 season pass, which provides access to episodes 1-4, was removed from sale on all major digital storefronts including PS4, Xbox One, and PC. A statement from Telltale says the company is pausing sales until further notice.
Some other notes and notable facts:
Telltale was founded in 2004 by former LucasArts developers Kevin Bruner, Dan Connors, and Troy Molander.
Telltale’s publicly disclosed funding partners included the venture capital firms IDG Ventures and Granite Ventures, along with the film company Lionsgate.
Of the seven named executives on Telltale’s management website, four, including Hawley, are former Zynga higher-ups.
Telltale has not filed for bankruptcy.
There is no word yet as to what will happen with the previously announced second season of Telltale’s Wolf Among Us.
Telltale also operates a publishing division that is behind the upcoming adventure game Stranded Deep from a two-person studio in Australia. The developer, Beam Team Games, does not know if it will be able to release the game on console in October as planned.
Telltale plans to provide a deeper update on its portfolio in the coming weeks.