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Sony Announces Job Cuts for Gaming Division; Is Web3 to Blame? – Crypto News

Published

1 year ago

February 28, 2024

Dripp

Sony Group announced on Tuesday that the firm will be cutting jobs from its video gaming department. According to reports by Bloomberg, Sony will be laying off around 900 people, or roughly 8% of the workforce. The reason for the job cuts arose on the ground of “game companies facing a post-pandemic spending slowdown”. The company, which previously ventured into blockchain-based video games, will see some of its biggest names face the wrath of these layoffs.

Sony Announces Layoffs; Plans Closing of a Group

Sony Group Corp. plans to close a group in London and lay off 900 workers globally, or around 8% of its workforce, in its video game division. According to Bloomberg reports, in a note to employees on Tuesday, Jim Ryan, the president and chief executive officer of Sony Interactive Entertainment, stated,

“After careful consideration and many leadership discussions over several months, it has become clear changes need to be made to continue to grow the business and develop the company.”

Sony announced that three 3 of its most successful subsidiaries, the game developers Insomniac (the company behind Spider-Man), Naughty Dog (The Last of Us), and Guerrilla Games (Horizon), will also be impacted by the layoffs. The virtual reality games and SingStar series are the main draws of Sony’s PlayStation London, are also closing.

The manufacturer of PlayStations previously made significant investments in online games. It is intended for long-term revenue streams known as “games as a service.” However, there is now too much competition in this industry, and many of the games have failed. Spider-Man and The Last of Us online games were just terminated by Sony.

Sony’s Venture into Blockchain Games

The multinational corporation Sony had declared its intention to create a blockchain-based network that aimed to “connect souls across generations.” To establish the network, the corporation had partnered with Singapore-based blockchain technology company Startale Labs.
With its headquarters located in Singapore, the joint venture was known as Sony Network Communications Labs Pte. Ltd. Its main goal was to be a creator of the Web3 network which could also facilitate blockchain-based video games.

With a hit to its video gaming department, Sony’s blockchain wing will also be affected.

Sony Not Alone in Layoffs as Boarder Market Grapples with Issues

Tech businesses are still suffering greatly from widespread layoffs, particularly in their gaming sections that grew to fulfill demand during the pandemic. Giant gaming companies are currently shrinking to reflect a slowing sector. According to VideoGameLayoffs.com, layoffs have reportedly affected 3,770 gaming professionals thus far this year. The extensive post-pandemic layoffs at gaming companies have impacted 8,500 employees in 2022 and roughly 10,500 positions in 2023.