[Multi] Report: Massive Layoffs at Silicon Knights

[Multi] Report: Massive Layoffs at Silicon Knights

1UP is reporting today that developer Silicon Knights is currently facing "massive layoffs" that will see all but 25 employees laid off from the 97-person studio, according to "sources close to the company". The developer, perhaps best known for its work on GameCube games Eternal Darkness: Sanity's Requiem and Metal Gear Solid: The Twin Snakes, has struggled since parting ways with Nintendo in 2004 having since released the critical and commercial disappointment Too Human on Xbox 360 and the even more poorly-received X-Men: Destiny which was released just a month ago.

Surprisingly, the move would follow several grants made to the company in recent years, including a $4 million grant from the Canadian government in 2010 and $3 million contribution from the Ontario provincial government earlier this year, along with $1 million committed from the Ontario Media Development Corporation in 2008. President Denis Dyack had only recently stated that these funds would enable the developer to hire 80 new employees in addition to the 97 current staff, as well make Silicon Knights a self-publishing developer.

Silicon Knights has not yet commented on the alleged layoffs.

In addition to the studio's poor track record on recent games, the company has also been mired in a legal dispute with Epic Games since 2007 in which Silicon Knights has sued Epic on allegations that they received insufficient support for Epic's Unreal Engine 3, the engine on which Too Human was initially being developed on. Epic has a counter-claim alleging that Silicon Knights tried to use the engine as it pleased without paying anything for it.

UPDATE: Silicon Knights has confirmed that 45 employees have been laid off, leaving around 40 staff still working at the studio. CFO Mike Mays pointed to a project that was recently axed by Activision as the reason for the layoffs, but hopes that the developer will be able to re-hire staff if and when work can begin on a new project.

Written by: Mike Glubish

(This post was last modified: 11-01-2011 07:40 PM by GlueGun18.)

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