Unity is analyzing its product portfolio to concentrate on the most important products to its customers and evaluating the right cost structure that aligns with the more focused portfolio, as stated in the company’s Q3 financial release. Unity, a software development business for games, has stated that it will “probably” implement layoffs as a cost-cutting strategy. According to the firm, it began a thorough evaluation of its product line a few weeks ago with the goal of concentrating on the items that offer the greatest value to its clients. Unity stated in its Q3 results report that it is also assessing the appropriate cost structure to match the more concentrated portfolio.
The company in its statement said,
We anticipate making final choices in the next weeks, and we are moving swiftly. We anticipate beginning the plan’s implementation this quarter and finishing all interventions by the end of 2024’s first quarter.
Recent policies and controversy
Recently, Unity revealed plans for a new Runtime Fee policy that will tax developers for every game install, which was a catastrophic decision. Even if the business subsequently disclosed important adjustments, the policy had already caused harm due to incensed developers’ criticism. Notably, the company has had a tumultuous year so far, with upcoming changes likely inspired by a recent wave of controversy. In September 2023, Unity management announced a new pricing structure for its flagship game engine that would have required game developers to fork out additional funds to continue developing games on the platform.
Many developers vowed to stop using Unity as a result of the strong backlash to these proposals, and although the corporation swiftly changed its intentions, the harm appeared to be done. Many developers declared they would no longer use Unity as their engine, claiming it had betrayed their trust.
Regarding the incident, Whitehurst stated,
“We introduced runtime fees on the Editor at the end of September to go along with our seat-based memberships, an essential move to make Create a sustainable business.” Although the implementation of the fees caused tension with our consumers and presented short-term challenges, we did not anticipate that they would be simple to implement. We anticipate that this shift in the business model will have little effect in 2024 and increase as more customers take up our new releases.
Following the uproar, Unity CEO John Riccitiello left the firm. A month later, a report stated that the new policy was “rushed out,” with the company’s declining share price and long-term profitability serving as the determining considerations. The price of Unity shares has been declining slowly, but it has declined dramatically since the Runtime Fee policy was announced.
Now Unity is part of the club
Unity has not yet disclosed the date or time of its likely layoffs, but we expect any updates to come in the upcoming months. Unity is the latest in a long line of video game firms preparing for or announcing layoffs in 2023. In the past year itself over 6,000 jobs in the gaming industry were eliminated. Companies that have announced layoffs thus far include Digital Extremes, Ubisoft, Media Molecule, Blizzard, Team17, EA, CD Projekt Red, Riot Games, Amazon, Ascendant Studios, Private Division, 2K, Volition, Firaxis, Telltale Games, Crystal Dynamics, and Epic Games.
