#175: Behind the mask

Hey, Hit Points passed 5,000 subscribers yesterday! That’s very nice. My humble, heartfelt thanks to each and every one of you. I am happy to be able to start today’s edition with some good news, because I am afraid things are about to go rapidly downhill.

This afternoon Microsoft announced that it is laying off almost 5% of its global workforce. The company behind Xbox, Windows, Azure and the pandemic-era hate crime that is Teams has blamed that modern classic, the uncertain global economy, to justify showing 10,000 people the door.

Microsoft’s latest set of financial results aren’t due until next week. I can only assume they make for unspeakably dire reading given that, in the three months to September 30 last year, the company made $17.6bn in profit off $50.1bn in revenue. It was sitting on almost $23bn in cash, which was up over 60% from the previous quarter. Yes, profits were down 14% compared to the same period in 2021. But, again: over $50bn in three months, of which over a third was pure profit, made by a company whose shares are today worth $1.79 trillion. We are still talking about a monstrously successful organisation, even if one of its numbers has gone down a bit of late.

Of course we are also talking about a company that is trying, at great legal expense, to convince antitrust regulators around the world to let it spend $68.7bn on the acquisition of Activision Blizzard. I am sure Satya Nadella and co would assure us that the deal is still vital to Microsoft’s future success. But might I suggest that perhaps, in the light of today’s news, that money could be somewhat better spent?

According to the salary-tracking website Comparably, the median Microsoft salary is $162,818 per year. Blowing the dust off the trusty Hit Points calculator, it appears that if Microsoft pulled out of the Activision deal and put that $68.7bn towards employee salaries instead, it could keep the 10,000 staff it is laying off today on the books for over 41 years.

Forty-one fucking years.

I am so sick of this shit.

We start a new year with a note of optimism, don’t we, however fanciful a notion it may be (and this year was particularly fanciful, sure). But already in 2023 we’ve had Ubisoft blaming its development teams, rather than its own shoddy decision-making, for its poor financial performance, and Krafton doing much the same after The Callisto Protocol failed to hit an impossible sales target. But this? This is just on another level.

Microsoft has spent the past few years casting itself as a different sort of big-tech titan, a kindly benefactor determined to do right by its people, its customers, and the world. Only a few days ago it proclaimed Xbox the world’s first ‘carbon-aware’ console, the latest step on the company’s push towards net zero. It also announced a new unlimited-leave policy for staff (which today has taken on a grim ironic twist). Nadella is even at it in his statement about the layoffs, pledging six months of healthcare coverage and career-transition support and all sorts to those he is showing the door. That’s pretty good of you, pal. You know what would be better? Not firing them in the first place.

As if it wasn’t already obvious, Nadella just reminded us that he and the organisation he runs are just like the others, as beholden to shareholder interest and hoarding wealth as the rest of them. A CEO who made $55m last year is sending 10,000 people out into the cold today because while revenue is up, profit is down, and that simply will not do.

Economic uncertainty isn’t about profits falling from one 11-digit number to another, slightly smaller 11-digit number. It’s about heating your house and putting food on your table and keeping as many of life’s everyday worries out of your mind as possible. It’s trying to find a job in a recession at the same time as thousands of other tech professionals who’ve also just been laid off by their capricious billionaire bosses because ooh, things look a bit iffy out there right now. It is a question, bluntly, of survival.

Which brings us back to Activision. If the state of your finances is so bad that you have to put thousands of people out of work, I’m not sure spending all that money on Call Of Duty and Candy Crush is a good idea. That seems… irresponsible, to me, not to mention cruel. When times are uncertain we must all tighten our belts and it is the luxuries, not the essentials, that are first to go. You want to spend $68.7bn on videogames? In this economy? Come off it.

It was a disgusting amount of money when the deal was announced. One year later to the day, in the light of these layoffs, it has simply become unspeakable. I’ve tried to avoid picking a side on this thing for a number of reasons but ugh, stuff it. If any antitrust regulators are reading, I hope you fire this rotten fucking business into the sun.

MAILBAG!

On Friday I told paid subscribers about my new year’s resolution: to abandon my years-long obsession with the new, and see what life is like away from gaming’s bleeding edge. (In the days since I wrote that, it has become apparent that I may in fact spend the whole year playing Final Fantasy XIV). Anyway, it sparked a great deal of chatter.

• “The moneymen lost my chase of the shiny when I started noticing how disrespectfully they price their own works within months of release,” offers Aaron Schrader in an email. “It makes me feel like a sucker, a stooge, to pay full price when I know that the holidays will offer said product at a severe discount.” Good point, this: my resolution should also save me a few quid, FFXIV subscription payments notwithstanding.
• “I really relate to what feels like an increasingly oppressive obsession with new games,” says Thomas Ohashi in the chummy Hit Points Discord. “I’ve got stuck in a pattern where I get caught up in the hype for something, buy it when it comes out, then immediately put it at the back of a queue of games that I swear I’m definitely going to play. This year I want to find some kind of equilibrium. I’m planning to reinstate some kind of ‘don’t buy it if you aren’t ready to play it’ rule, as well as being more forgiving if I do lose interest in something before finishing or even starting it.” The Discord chat then devolved into a discussion of the myriad ways in which people track their backlogs and to-do lists. Someone admitted to using a Trello board. I think we all need help.

Leave a comment, join the Discord, send me an email or hit reply to this one and let us continue this mutual group therapy session on Friday.

MORE!

• Sticking with Microsoft, CEO Satya Nadella says that machine-learning tools such as ChatGPT and DALL-E will boost human productivity, and that “every product of Microsoft will have some of the same [machine-learning] capabilities to completely transform the product.” All of which makes 10,000 layoffs even more distasteful, when you think about it. What a day this is turning out to be.
• The Ubisoft Paris chapter of the French workers union Solidaires Informatique has called on staff to strike in protest at Yves Guillemot’s disastrous attempt last week to blame development teams for the publisher’s woes. The union wants an immediate 10% company-wide raise, the introduction of a four-day week, and for greater transparency from management. It wants staff to walk out between 2pm and 6pm on Friday, January 27, which I have to say is disappointingly small-time, particularly when one of your demands is having Fridays off forever. Always thought the French were supposed to be good at this stuff. Aim higher!
• Unity is laying off almost 300 staff, which the company says is partly driven by the economy and partly by the need for streamlining after the acquisition of IronSource. A good day to bury bad news, eh. My thoughts with all those affected.
• I forgot to mention this last week but Wireframe, the print magazine set up by the Raspberry Pi Foundation in 2018, is shutting down. A real shame, this: while my heart obviously lies elsewhere I had tremendous respect for its focus on indies and hobbyist development, and of course for its attempt to keep the print flag flying high. As editor Ryan Lambie explains in this thoughtful interview, rapidly rising costs were the final nail in the coffin. Hit Points wishes him and the rest of the team all the best.
• Stadia closes down for good later today, and it’s dying much more elegantly than it lived. Google has released, for free, a game it used for testing in the early days of the platform, acknowledging the contribution of hundreds of Stadia staff in its credits. It’s also released a tool to unlock the (actually pretty good) Stadia controller for use on other devices over Bluetooth.
• Seven Blizzard games will be taken offline in China later this month after the company’s 14-year publishing partnership with NetEase came to an end. Not sure exactly what’s going on here: NetEase blames “material differences” on the two parties’ failure to reach a new deal while Blizzard, which says its request for a six-month extension was refused, said there was no agreement on a deal that was “consistent with Blizzard’s operating principles and commitments to players and employees.” Blizzard is now on the hunt for a new partner, though its games will surely be offline in China for some time while the search goes on.
• Dozens of game companies in India have hit out at the government’s plans to put the nation’s game industry and real-money-gambling sector under the same regulatory umbrella. “The business model, consumer engagement behaviour, legal environment and peripheral operations of the two industries are totally different… it is neither accurate nor fair for the two to be clubbed together,” reads an open letter signed by 44 game studios and esports firms.
• Elden Ring, but it’s GeoGuessr? Enjoy.

Right! Let’s leave it there. With a fair wind I might just be able to sneak in some FFXIV before the school run. (edit: I did.)

Before I go, did you know that you can get even more Hit Points in your inbox for just £4 a month? You’ll receive at least one more edition per week, unlock the full archive, support my fully independent work and earn my eternal adoration and respect. You’ll also have access to Hit Points’ occasional longform developer interview series, Max HP, which to date has featured such industry luminaries as David Polfeldt, Tracy Fullerton and Tetsuya Mizuguchi, to name a few. There’ll be another one along in a few weeks too (bit bogged down with consulting work at the moment, but bear with me).

And if you’re not minded to take out a paid subscription, perhaps you’d give this a share. With no algorithm to game, Hit Points is as reliant on its readership for growth as it is for revenue. Shares are the very lifeblood of this endeavour of mine, and all you can do to help spread the word would be enormously appreciated.

That’s enough waffling from me. Paid subs, I’ll see you in a couple of days; I’ll be back with the rest of you next week. Lots of love!