No devs, no Game Pass — former Bethesda exec calls out Xbox’s self‑destruct button

Pete Hines sat down with dbltap to discuss his career and his former child, Bethesda. The ongoing dismissal of gaming developers at Microsoft came up, and the former Senior Vice President and Head of Publishing of Bethesda had quite a bit to say.

"I'm not working in any of these companies anymore, and so I don't assume that everything I knew while I was in the industry still holds true today," Pete expressed.

"At the same time, I'm involved enough to know I saw what I considered to be some short-sighted decision-making several years ago, and it seems to be bearing out the way I said."

Only seven months after his retirement, Microsoft would go on to close the doors of his former colleagues at Arkane Austin and Tango Gameworks. Pointing the finger toward the current industry boogeyman, he resumed.

"Subscriptions have become the new four-letter word, right? You can't buy a product anymore," Pete added.

Outside of the fact that you can buy a product, the latest Game Pass release, Hollow Knight: Silksong, reached over 500,000 players on Steam. A platform where you must purchase the game to play it.

Pete continued, "When you talk about a subscription that relies on content, if you don't figure out how to balance the needs of the service and the people running the service with the people who are providing the content – without which your subscription is worth jack sh*t – then you have a real problem."

The layoffs within Microsoft and Xbox have been perplexing, to say the least. Following the troubled release of Redall, Arkane Austin closed its doors indefinitely.

On the other side, Tango Gameworks released the critically acclaimed Hi-Fi Rush. Even success didn't save them, as their doors were closed until the recent reopening, thanks to KRAFTON.

Earlier in the interview, Pete acknowledged the purchase and introduction of studios into the Bethesda fold, which included the likes of Arkane, Tango, ID Software, and MachineGames. He spoke mainly about the integration of teams and how one studio could work with another so readily and openly to collaborate on something greater than themselves.

He noted, "It became useful because if you're working on guns at Bethesda Game Studios, maybe you should have a conversation with id Software about how they make their guns feel so weighty and powerful."

What puzzles me about this is how Tango Gameworks fits into that equation. While it's clear that MachineGames, ID Software, and others shared a bond over first-person shooters and narrative games, Tango wasn't known for something like collaborative work in that area.

Even Shinji Mikami, the former head of the studio, penned the acquisition deal with Bethesda in 2010 because he felt Bethesda gave them the greatest chance of being independent. To me, Tango Gameworks doesn't align with Pete Hines' overall view of the acquired studios at Bethesda.

Which then begs the question: Was Tango Gameworks' closure more a result of that lesser collaboration than any success the studio had achieved?

It's clear that the recent round of closures and layoffs at Xbox is a further result of Microsoft's overall strategy rather than the gaming developers themselves. With AI being the real four-letter word of the current day, the 9,000 layoffs within Xbox and Microsoft were rumored to have happened to fund $80 billion AI investment.

While that doesn't completely negate the possibility that those layoffs occurred with Game Pass profits in mind, surely it helps mitigate the idea that that metric wholly drove it.

We haven't seen the closure of studios like Obsidian, which continue to produce similarly successful games, such as Grounded, Grounded 2, and Avowed. The last of which had a far greater budget than anything Tango Gameworks ever created.

I'm not trying to defend Microsoft; instead, I'm proposing a better understanding of why these layoffs occurred in the first place. AI or not, the closure of these studios will forever put a stain on any joy I have with a Microsoft product for years to come.

Pete would resume, "You need to properly acknowledge, compensate, and recognize what it takes to create that content and not just make a game, but make a product. That tension is hurting a lot of people, including the content creators themselves, because they're fitting into an ecosystem that is not properly valuing and rewarding what they're making."

He's not wrong in the sense that a tension is building within Microsoft that is affecting people and developers alike. The variant of poison polluting those good people is the only slight disagreement we have.

There are too many counterarguments to ignore the success that Game Pass has brought to a multitude of smaller development studios, both within and outside of Microsoft. Never does it seem that Game Pass itself is hurting these developers.

The mismanagement of Microsoft's portfolio is the leading cause of suspicion and heartbreak within the development studios.

Whether it's investments that outweigh the GDP of over 100 countries, or the dissatisfaction with something made up last Tuesday, it's the executives at the top who are driving developers and gamers to distrust anything and everything related to Xbox products. Game Pass included.

Microsoft's messaging has never been good, and continues to baffle me, along with thousands of others.