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38 Studios Missed Payment; Asking for Cash

BostonHerald.com has word that The Rhode Island Economic Development Corp. is deferring until Monday any decision on how best to deal with apparently cash-strapped developer 38 Studios, who are already carrying $75 million in debt to the state. Having met with 38 Studios about the matter, they will now look to use this extra time to consult with industry experts, with Gov. Lincoln Chafee saying, "we’re making a good decision by not making a decision," adding: "There’s not a great pool of advisers in this industry, but we’ll find them." The report says the governor confirmed that the company missed a $1.125 million payment to the state scheduled for May 1st, and is now asking for more money. 38 Studios founder Schilling refused to answer questions about this for reporters after his meeting, saying: "My priority right now is to get back to my company. My priority right now is to get back to my teammates." Thanks Nomaar.

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17. Re: 38 Studios Missed Payment; Asking for Cash May 17, 2012, 12:18 Creston
 
Hold Curt Schilling personally liable. He can easily pay back the 75 million.

Creston
 
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16. Re: 38 Studios Missed Payment; Asking for Cash May 17, 2012, 10:33 Kajetan
 
Mingus wrote on May 17, 2012, 10:13:
It just does not work.
It does. You just have to do it right.

Supporting individual companies is stupid. Supporting a whole industry sector for a certain amount of time on the other hand, to kickstart new business models, is not a bad thing.
 
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15. Re: 38 Studios Missed Payment; Asking for Cash May 17, 2012, 10:13 Mingus
 
I have never been a fan of any form of government 'industrial policy' (i.e. picking winners and losers).

It just does not work. This should be left up to the venture capitalists playing with their own damn money and those of their investors.
 
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14. Re: 38 Studios Missed Payment; Asking for Cash May 17, 2012, 09:36 Elf Shot The Food
 
Maybe they should plead their case on KickStarter.  
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13. Re: 38 Studios Missed Payment; Asking for Cash May 17, 2012, 09:25 nin
 
Guess we will probably not see their promised MMO ever.

I can't imagine that being successful anyway.

 
http://store.nin.com/index.php?cPath=10
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12. Re: 38 Studios Missed Payment; Asking for Cash May 17, 2012, 09:21 Ozmodan
 
Curt never has managed his money very well. Companies that do not pay attention to expenses are not long for the business. Guess we will probably not see their promised MMO ever.

After understanding the direction they were going, I probably won't miss it either.
 
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11. Re: 38 Studios Missed Payment; Asking for Cash May 17, 2012, 08:45 Verno
 
theyarecomingforyou wrote on May 17, 2012, 03:50:
What the hell did they spend money on to lose $75m? I honestly don't get it. It sounds like criminal negligence or outright fraud.

They bought Big Huge Games and several technical properties. They were working on an MMO, paid out big money to secure names like Salvatore and Mcfarlane. I doubt there was any fraud involved, it's just been misspent on a classic example of overreaching for a first product. They should have started out small like Runic instead of trying to compete with the large AAA devs. The name of the product and its marketing were also very poorly chosen.

Amalur is one of the most overproduced games I've ever seen.

This comment was edited on May 17, 2012, 08:54.
 
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Playing: Alien Isolation, 7 Days to Die, Dragon Age Origins
Watching: The Canal, Brazil, The Town That Dreaded Sundown
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10. Re: 38 Studios Missed Payment; Asking for Cash May 17, 2012, 07:53 Zadig
 
The $75 million probably disappeared into the WoWclone they were working on. They're very expensive for something that's guaranteed to be a disaster!

For the studio itself: a bad company making bad products should go out of business, but if they have enough political connections it won't be allowed to happen.
 
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9. Re: 38 Studios Missed Payment; Asking for Cash May 17, 2012, 05:07 Kajetan
 
theyarecomingforyou wrote on May 17, 2012, 03:50:
What the hell did they spend money on to lose $75m?
Big names require big paychecks. RA Salvatore doesnt come cheap, even if he does some very cheap work on KoA. And having much money to begin with leads to spending too much money on unimportant stuff, spending too much money on management, spending too much money on creating assets with no or little importance to the game itself.

Why are indie games often more fun than their triple A brethrens the majors churn out? Because their creators dont have much money, so that every pixel, every game mechanic, every bit has to count. Look at Grimrock. This game has only a limited set of sounds and textures, a limited set of features, but EVERYTHING helps perfectly in creating a fun and engaging game.

Budget limitations are good for creativity
 
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8. Re: 38 Studios Missed Payment; Asking for Cash May 17, 2012, 04:58 Kosumo
 
They must have gone thought a lot more than just that $75m, thats just to the state and I doubt the state would have let it get that high unless they had other sources of funding/money at some stage.

Is this the company that was in Florida and moved for the tax incentives?

Also - "There’s not a great pool of advisers in this industry, but we’ll find them." Some where right now, Derek Smart is traveling a speed to help Gov. Lincoln Chafee.
 
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7. Re: 38 Studios Missed Payment; Asking for Cash May 17, 2012, 03:50 theyarecomingforyou
 
What the hell did they spend money on to lose $75m? I honestly don't get it. It sounds like criminal negligence or outright fraud.  
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SteamID: theyarecomingforyou
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6. Re: 38 Studios Missed Payment; Asking for Cash May 17, 2012, 01:36 Wolfen
 
""we’re making a good decision by not making a decision"

heh
 
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5. Re: 38 Studios Missed Payment; Asking for Cash May 17, 2012, 01:01 Rigs
 
They should be looking at seizing all assets and chattels to auction off and recoup what they can.

Except that will never happen, given how public this situation is. That would mean that local government made a mistake, gave money to someone that wasn't worthy (and the public found out about the whole thing or knew from the start) and now that it failed miserably (what the hell do they do with all this money?! $75 MILLION?! Think about that for a second. No way operating expenses went that high. Not a chance. It was wasted, plain and simple) they have to find a way to come out of it without having to resign. Auctioning the assets would be the smart thing, but it will be the last resort...


=-Rigs-=
 
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'I know what you think you are, what you want us to believe! But I don't buy it! For three years now you've been pulling everyone's strings, getting us to do all the work, and you haven't done a damn thing except stand there and look cryptic.'
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4. Re: 38 Studios Missed Payment; Asking for Cash May 16, 2012, 23:10 Cutter
 
It's a major problem when you attach big names to a project who are barely involved. And it's obvious they didn't have a clear vision of what they wanted, only that it had to have WoW-like mass market appeal and be designed foremost with the Xbox in mind. It's pretty obvious on a lot of levels why it failed. The MMO is bound to fail hard too. RI should have never given them a dime to begin with but will be complete fools if they give them any more money at all. They should be looking at seizing all assets and chattels to auction off and recoup what they can.
 
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"Nobody wants to be nobody in America. Ed is the apotheosis of a prevailing American syndrome. It used to be that someone became famous because they were special. Now people are considered special just for being famous. Fame, itself, is its own virtue.
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3. Re: 38 Studios Missed Payment; Asking for Cash May 16, 2012, 21:40 NKD
 
Hellbinder wrote on May 16, 2012, 21:38:
i really dont get what happened here. they were supposed to be making anew custom mmo. i mean that is what schilling was talking about what 3-4 years ago? why do all this other stuff. you can still make a decent mmo for 25 million or less. 75 million and no mmo really?

This is what happens when a pitcher tries to do something unrelated to tossing a little white ball at someone.
 
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If you don't like where gaming is heading, stop giving your money to the people who are taking it in that direction.
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2. Re: 38 Studios Missed Payment; Asking for Cash May 16, 2012, 21:38 Hellbinder
 
i really dont get what happened here. they were supposed to be making anew custom mmo. i mean that is what schilling was talking about what 3-4 years ago? why do all this other stuff. you can still make a decent mmo for 25 million or less. 75 million and no mmo really?
 
The Whales name is Bob.
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1. Re: 38 Studios Missed Payment; Asking for Cash May 16, 2012, 21:07 Kosumo
 
This is happening the world over in many industry .... this is what happened to Ireland - this is now Lord of the Ring's (was) and The Hobbit ($30 million NZ tax dollars!!) are getting made in New Zealand - Tax payer money with none of the profits coming back to the govenment.

Peter Jackson gets rich out of the LotR movies, NZ who garanties (said they would pay if it fails) gets less than nothing, we got the bill and now they are changing the employment laws to better suit 'sir Peter' (i.e. he does not even use local crews, he flies in to the country whom ever he wants and the govenment gives them work permints.)

I'm so in rant mode, someone bring me a error 37!
 
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