Lays off entire staff.
Glad MA avoided that, maybe Schilling will be embarrassed enough he won't show up in the state anymore except for Sox-related activities. Nobody wants to hear his inane ramblings about video games and politics.
He did manage to vividly demonstrate his own point about the wastefulness of government handouts.
Sometimes I'm ashamed feeling happy at others' misfortunes.
This is not one of those times.
This was a catastrophe of epic proportions. Let this be the end of government subsidies!
400 workers came into work Thursday and got a pink slip. Happy fraking memorial day! And it's not like there were many signs, or rumblings before the implosion. Plus there the loss to the taxpayers and his other creditors.
Meanwhile Shilling walks away with his fortune secured, after playing risk free with other peoples money. He already paid himself up front with that loan. Perfect example of what OWS is mad about, a 1%'er risking others money (taxpayer and creditor) and flushing it down the toilet with no risk to his own holdings. How many relocated on his behalf? Not to mention the state is now on the hook to distribute unemployment to these folks. That costs taxpayers more money.
He should be forced to pay it back. He also needs to keep his hypocritical opinions to himself. If he really wanted to save 38 studios, he had a deep enough pocket to do so.
He wouldn't risk his own money, so it's dead. That's called cowardice.
Your claims seem a little out of whack. Supposedly, he has some skin in the game, to the tune of $30 million. That's the number I've seen a lot, though tough to verify.
As far as playing with other people's money risk free, blame the state of RI as they came up with the terms for the line of credit. There's no way I would have loaned him money unless he had a serious personal investment in the company.
Look, I have no love for the guy, but your rant goes way overboard.
He invested $30 million, but what we know is he ponied up 4 million to procure the loan, then promptly paid himself hack with said loan.
Already knowing that he's a hypocrite, what do we have to go on that he invested $30 million? His word?
Fool me twice?
I'm wondering if the $30 million was the valuation of the company and assets before it went belly up. $30 million sunk into a dev studio with nothing to show for it doesn't sound right at all. If it was, as soon as the first $15mil was spent it was done for.
From here on boston.com
The former baseball star also disclosed that he has invested some $50 million of his own money into 38 Studios, and he risks losing it all.
Schilling has repeatedly declined to comment to The Boston Globe and again on Tuesday did not respond to requests for an interview. The Providence Journal story not only provided his only detailed remarks on the demise of his company, but also additional information about Schilling’s personal investment in 38 Studios. He told the newspaper he had invested $38 million directly into the company and guaranteed another $12 million in personal loans.
Any prospective investor in the company would have access to the books and be able to verify this. As outsiders, we have to figure out what we want to believe.
They sold over a million copies of their first game...and they're broke less than a year later. I don't understand that at all. Did they agree to the worst contract with EA that anyone has ever signed or what?
According to Joystiq, they needed to sell 3 million to break even.
1 million in sales at 60 bucks a game is 60 million right? I assume the main studio gets at least half of that?
Something doesn't add up unless they put profit money into new developments and things started to fall apart in the new venture?
First off wholesale publishers sell them for $50 to retail.
Sony/MS get a ~$10 cut just to put it on their consoles. Sony/BR association and the DVD association get about a $10 per disk cut too. That's already 1/3 your revenue.
Then there's publisher costs and fee's, which are substantial. Especially for EA.
$10-15 per game sold is all they get. Not the full $60.
It depends of course, on the popularity (and therefor leverage) of the particular game designer house. But as a very rough rule of thumb, the wholesaler price is about 40-50% of the final retail price, and the publisher/distributor (in this case EA, not Shilling's company) gets about 75% of that.
So 1 million copies @ $60 retail = several million dollars for 38 Studios. Not very much for a couple years effort by a few hundred people.
is not a lot across 3 platforms. Especially for a new studio/IP with a cash burn rate of a AAA dev studio. After publisher and console dev fee's, they probably would have had to done 2-2.5 million release to break even.
And that not getting into the fact that the game released was from Big Huge Games, a dev studio 38' bought out so they could release something, anything, to generate revenue. That means they bought their debt too.
The buyout of BHG was basically a stall for more time and to get some sort of revenue generating product to the market. When that failed to sell well, it became a bigger liability than a fix. And here we are.
And they wherein the process of developing another game? It still seems to me like shilling knew what he was doing in terms of making a game, but failed in terms of finding someone who could finance him the right way.
If grand theft auto 4 can sell just over 20 million copies, a first run game isn't doing that bad selling 1.2 million.
Ah hell, what do I know.
to make enough off your first game / IP to at least cover costs of your next. Let alone pay the bills of the first, otherwise you're in bankruptcy.
Simple as that. It's how the industry works, you can't just play with pure debt and run a loss hoping to score big "sometime in the future" unless you're being 100% funded by a very large publisher. Otherwise you'll run out of money, and no one else will loan you any.
And that's exactly what happened to 38 studios.
I'll put it this way, 1.2 million copies for a new IP is not bad, as long as the game was budgeted and developer smartly.
38 studios did not do that, and they were so deep in the red, even 2 million in sales wouldn't have saved them, something usually reserved for large publisher backed games that already have built in supports and can risk a poor showing since the risk is diluted from the other releases the publisher is working on.
There's not a lot of private investment in videogames, because new IP's are very risky. Moreover, dev's take on a lot of the risk, and publishers don't. Any independent studio needs to put up before they're allowed to speak.
I'm not sure if it's relevant or not, but I've seen comments on how nice the office was, how 38 had full time receptionists and HR staff, how it was reminiscent of some of the better studios out there in terms of how the office looked. You don't spend that kind of money before you have a product to show... as you're really starting your business from the wrong end and viewpoint.
Remember when Steve Buckley of the Boston Herald (and sometimes WEEI) came out of the closet? Dennis and Calahan, who had previously made a career out of sniggling, snorting homo-jokes couldn't have been more supportive. Because while Buckley may be gay, he's one of us...
Now Schilling treats the taxpayers one of the most beat-up states in the country like his personal ATM machine. And the reaction from D&C--well, that's okay. It's business, you know. And Curt, who is on regularly, well, he's one of us....
As Glenn Ordway is fond of saying, it's all about the Laundry. And in this case, Mr. Free Enterprise Foremost was wearing the right uniform.
I'm not sure I understand all the hate on Schilling when all the blame for this is on the RI pols. Sure hate on Curt all you want because he's a Republican who took a handout - no problem with that. But the blame for the loss of millions ($50M+ anyway) of taxpayer money lies solely on the RI politicians who made a very large, very ill-advised (i.e. stupid) investment. I'm not making that assessment with the benefit of hindsight, either. This was a perfect example of star-struck politicians throwing around public money and wasting it on a high-risk adventure.
I would love to have someone investigate the money flow and see if any of it ended up in pols pockets.
Current gov was running against it, and the Dems (for reason debatable) were outraged at it being shoveled through.
The former Republican Governor pushed it through in his lame duck session.
Proving once again there's really very little fiscally conservative about the GOP. They are just as worse if not worse than most Democrats, they will just call it something else. This kind of poorly thought out back patting usually doesn't happen on the state / federal level though. It's usually reserved for large cities and regional governments.
Can we have a real fiscally conservative party please?
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