in light of the microsoft closings, a lot of people saying that getting acquired by a bigger company should be considered a death sentence for small studios. one thing I never understood is why are studios sold? I understand the owners want to cash a check and get out of the anxiety crisis it is running an indie studio but is it that unreasonable to refuse it? does it cause other consequences most people arent aware of?

Honestly, the decision to sell to a publisher is primarily a question of stability.

Independent studios live and die on their ability to secure contracts regularly, year in and year out. This process is a constant grind, requiring the studio leadership to maintain good relationships with publishers. Financial situations are never super stable, they are often feast or famine when there are tons of opportunities that your studio can’t possibly field and then there are lean times when finding work can be difficult. It’s especially difficult because there’s almost no way that an independent studio can bank the kind of money they’d need to keep everyone paid for any extended period of time without securing a new contract to keep the lights on. There’s also the disaster of having so many opportunities that the studio staffs up in order to handle more, only to get caught in a lean period where there isn’t enough work to keep everyone employed. In lean times, the independent studio is left to fend for themselves while the publisher-owned studio gets higher priority when the publisher is considering project assignments. And there’s always the issue of IP ownership – often the publisher is the one who retains the rights and the studio is work for hire. There’s very little room for error when running an independent studio.

If the studio is owned by the publisher, there isn’t a need for securing contracts anymore. An internal studio almost always has priority over an external studio for being assigned a new project. The internal studio can focus on developing games and technology. They don’t need to worry about securing IP rights anymore, since they’re all owned by the same company. It’s a huge reliever of stress from studio leadership to know that there’s more of a safety net, even if that safety net is not perfect. When lean economic times hit, everyone suffers – including the internal studios, as we have seen. Large companies will often shed staff during bad times but have a higher overall survival chance than small ones.

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