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The Devastating Impact of a Video Game Failure on Development Companies

An image from the racing video game called "Blur".

In the video game industry, the release of a new title can be an exciting yet risky endeavor. While many games achieve success and become best-sellers, others are not so fortunate. For some companies, the failure of a video game can have devastating consequences, leading to the closure of the company. This article explores some notable cases where companies had to close due to the failure of one of their video games.

Examples of video game companies that closed due to the failure of their games

1. 38 Studios - "Kingdoms of Amalur: Reckoning" (2012): 

Founded by former baseball player Curt Schilling, 38 Studios developed the massively multiplayer online role-playing game "Kingdoms of Amalur: Reckoning." Despite positive reviews and favorable player reception, the game failed to sell enough copies to cover development costs, leading the company to file for bankruptcy in 2012.

2. Bizarre Creations - "James Bond 007: Blood Stone" (2010): 

The British developer known for games like "Project Gotham Racing" and "Blur" closed its doors in 2011 following the commercial failure of its action-adventure game "James Bond 007: Blood Stone." Despite generally favorable reviews, the game failed to sell enough copies to keep the company afloat.

3. THQ - "Homefront" (2011): 

Once one of the industry's largest publishers, THQ filed for bankruptcy in 2012 after a series of failed releases, including the action game "Homefront."

4. Visceral Games - Star Wars Game Project (Cancelled): 

The developer behind "Dead Space" shut down in 2017 after its Star Wars game project was canceled by Electronic Arts, resulting in a devastating blow to the company.

5. Boss Key Productions - "LawBreakers" (2017) and "Radical Heights" (2018): 

Founded by Cliff Bleszinski, the company closed its doors in 2018 following the failure of its games "LawBreakers" and "Radical Heights."

6. TellTale Games - "The Walking Dead: The Final Season" (2018): 

Primarily known for its narrative-driven games, TellTale Games closed in 2018 due to financial issues following the release of "The Walking Dead: The Final Season."

7. Studio Liverpool - "Wipeout 2048" (2012): 

Formerly known as Psygnosis, the studio closed in 2012 after the commercial failure of "Wipeout 2048" for the PlayStation Vita.

8. Daedalic Entertainment - "The Lord of the Rings: Gollum" (2022): 

Developed by Daedalic Entertainment, "The Lord of the Rings: Gollum" was an adventure game based on the popular character from J.R.R. Tolkien's work. Despite initial anticipation and interest in exploring Gollum's story, the game received mixed reviews after its 2022 release. Critics and players cited technical issues, unpolished gameplay mechanics, and a narrative that failed to meet expectations. These factors contributed to poor commercial performance, resulting in financial difficulties for Daedalic Entertainment and ultimately the closure of the company as a developer.

These examples highlight how the failure of a game can have a lasting impact on a video game company, even in the most recent cases. Each of these closures represents not only the loss of jobs but also the end of a legacy in the interactive entertainment industry.


While the video game industry is competitive and challenging, it is also a field where creativity and innovation can thrive. Despite the challenges, many companies have managed to adapt, learn from their mistakes, and move forward, demonstrating the industry's resilience and determination to continue delivering unique and exciting gaming experiences for players worldwide.

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