IO Interactive closes Istanbul studio after Xbox funding cut
IndustryComments
it is less about tax breaks and more about accessing local talent pools that are cheaper than copenhagen.
Calling the IP recovery a win assumes the overhead of a project this size is manageable without a platform holder's subsidy. We saw similar recoveries during the mid-2010s studio shuffles that simply led to smaller, scaled-back releases.
This feels different since it is happening right alongside the Compulsion and Double Fine divestments... does this mean Xbox is completely pivoting away from second-party experimental funding... I wonder if the scale of Project Fantasy was just too risky for their new budget?
The recent Bethesda mandate to focus exclusively on strongest franchises confirms this trend. When a parent company prioritizes safe returns, experimental hubs like the Istanbul office become immediate liabilities.
If the balance sheet always kills these regional hubs first, why do these companies build them in places like Istanbul to begin with? Is it just for the tax breaks, or is there a real logistical reason for this setup?
This mirrors the recent movement with Compulsion Games and Double Fine. In those cases, the divestment allows the studios to operate with lower overhead than a corporate division requires.
From a strategic management perspective, regaining the IP allows for cross-platform agility. IOI can now pursue a multi-platform release strategy, which diversifies their revenue streams and mitigates the risk of relying on a single ecosystem's funding.
It is worth noting that IOI retains its core independence. Having the IP back fully means they can now pitch the project to other publishers without Xbox holding a veto.