Destructoid Checkpoint: Bioware is just the beginning

The big news this week is the closure of BioWare. The move comes in the wake of EA’s purchase and transition into a private company. The deal, led by Saudi Arabia’s Public Investment Fund, private equity firm Silver Lake, and Jared Kushner’s Affinity Partners, has saddled EA with about $18 billion in debt. 

As such, it’s safe to say that BioWare is just the start.

The debt must be serviced

Debt on its own is bad enough, but its cost in interest is where things get worrisome. If you have ever watched a gangster movie, you will be aware that bad people will give you enough money, but with enough interest to ensure you willnever fullypay back the loan.

EA will likely be on the hook for a roughly $1.8 billion interest payment yearly, and their EBITDA ( earnings before interest, taxes, depreciation, and amortization) comes to roughly $1.5 billion. 

According to EA, they plan to cut costs by about $700 million per year, which will include $170 million in what they termed organizational efficiencies. That will pretty much translate to layoffs.

These things also take years, so expect a cycle of studio closures, game cancellations, and layoffs as more and more projects fail to meet the required return on investment to stay alive in the era of EA.

In their letter “Building EA’s next chapter,” the company states that they plan on working on fewer large projects at the same time. As such, you can expect studios unable to get themselves onto the list of active projects to get merged, or just shut down altogether. 

Why BioWare was first

BioWare was in an interesting position because they were a small team. Reportedly,closing the studio  trims only 50 jobs, which means roughly 350 left to get in this first round of cuts. The implication is that they would not have been terribly far down the road on their new Mass Effect game. 

That alone seems to imply a lack of confidence in BioWare and their ability to deliver, and that will have been driven by the studio's recent history. Their last unqualified success was Dragon Age: Inquisition back in 2014. That game would go on to sell 12 million units, making it BioWare’s biggest game ever. 

But since then, Shadow Realms was canceled, Mass Effect: Andromeda was somewhat troubled when it came to general reception, but was reasonably financially successful, though a far cry from Inquisition. Anthem was an abject failure, and Dragon Age: The Veilguard drastically underperformed in sales. Sadly, all this would have made having faith in the budget required to get the next Mass Effect out the door hard to come by.

It’s also a tone-setting move, as terrible as that is to say. It lets all the other studios know that history will not save you, not even a studio like BioWare that has produced some of the most highly regarded RPGs in Western dev history. 

This is just the first move since the sale of EA was confirmed. There are reports that EA attempted to sell BioWare after Veilguard, and has been considering closing or selling multiple studios, as well as sending some IP to auction. 

It’s the latter that might hint at the future of EA, as selling off dormant IP is a good way to stir up some loot to hit those pressing interest payments, and there is bound to be some value in the various franchises that BioWare has developed over the years.

Success has not saved studios from the layoff train that is the current games industry. DICE had layoffs even when Battlefield 6 was a well-regarded, roaring success. Titanfall developer Respawn had projects canceled, and Skate studio Full Circle was impacted in February this year.

This is just another massive bet on AI

What remains at EA will likely be good fodder for the AI machine. Formulaic, long-term series that change little year to year are essentially perfect to take on aspects of AI development, as it is so easy to bake in experiments and see how they do. 

It’s impossible to know for sure, but it seems likely that AI will become an assumed way to control development costs, even for the most profitable series, and improve margins. CEO Andrew Wilson has stated that AI is central to EA’s strategy, and back in 2024 claimed that up to 60% of the publisher’s development processes could be impacted by AI. In January of this year, the company announced a partnership with Stability AI, makers of Stable Diffusion, to develop what they called “transformative AI models, tools, and workflows.”

As sad as it is to say, this is likely just the start of the cuts, and you can expect more studios to close, more games to vanish into the vaults, and more developers to lose their jobs.