SEGA in a big crisis: Laying off 240 workers and selling Relic

Relic Entertainment, which makes games like Company of Heroes and Dawn of War, has announced that it is parting ways with Sega and buying itself

by Sededin Dedovic
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SEGA in a big crisis: Laying off 240 workers and selling Relic
© Company of Heroes / Youtube channel

Relic Entertainment, the acclaimed developer behind strategy titles such as Company of Heroes and Dawn of War, is embarking on a new chapter. After years under the umbrella of SEGA, Relic announced the transition to an independent studio.

The news comes with a mixed bag. While Relic gains creative freedom and control over its future, SEGA Europe is undergoing significant restructuring, resulting in the unfortunate loss of around 240 jobs across their studios – SEGA Europe, SEGA Hardlight and Creative Assembly.

This news comes after a challenging year for Creative Assembly, as they previously canceled their 2023 Hyenas project. According to GamesIndustry.biz, SEGA apologized to employees who learned of the layoffs through social media and news outlets.

Strict regulations requiring SEGA to notify the Tokyo Stock Exchange in advance led to the rapid spread of information. SEGA claims the job cuts are part of a wider strategy to "streamline" operations and "focus on what they do best".

The news coincides with a historic event when SEGA employees became the first in the gaming industry to successfully ratify a union contract, potentially sparking similar movements across the industry.

What does this mean for Relic and SEGA?

Relic's future holds exciting possibilities.

As an independent studio, they have the freedom to pursue their creative vision without the constraints of a publisher. The success of Company of Heroes and their ongoing partnership with Microsoft in the Age of Empires franchise suggests a stable foundation for their future endeavors.

However, the layoffs at SEGA paint a worrying picture. The loss of 240 employees undoubtedly affects the development capabilities and morale of the studio. While SEGA wants to "focus" through this restructuring, it's unclear which projects and teams may be affected.

The departure of Relic as one of the most reliable partners is probably a consequence of the mild crisis in which this company found itself. The news surrounding Relic and SEGA highlights significant trends in the rapidly evolving gaming industry, and the market has never been more dynamic.

On the one hand, studios like Relic are seeking greater creative autonomy, potentially leading to an increase in independent development. The unionization of SEGA employees is a significant development, potentially paving the way for improved working conditions and worker protection across the industry.

As the situation develops, it will be interesting to see how Relic manages its newfound independence, or whether it will fall under the umbrella of a stronger company than SEGA.

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