Gaming · Sunday, 23 August 2026

01 · Briefing · what happened

Riot's fighting game did not fail. It stopped growing, and that was enough.

Gaming 2 min 22 sources

Riot is ending active development on 2XKO because it costs more to keep open than it brings in, and Sony has stripped the always-online parts out of its Horizon spin-off. In the same week, the people leaving big studios kept rebuilding at four, twelve and twenty-six.

jobs already cut from 2XKO

months before the game was wound down, because it could not support a team that size [1]

3,200

Xbox jobs going this year

the division's fifth round of cuts in three years [6]

staff at Black Pony Immersive

Arkane Austin veterans, two years after Microsoft closed their studio [7]

$500,000

the budget ceiling WINGS wants

including marketing - the size of cheque the funders are now writing [13]

At a glance

Riot will end active development on its free fighting game 2XKO in December, saying it costs substantially more to operate than it brings in [1].
The reason given was not decline but flatness: engagement stayed level even after bigger updates, so the game never grew into its own running cost [1].
Riot had already cut about 80 jobs from the team earlier this year, after saying the game was not reaching the level needed to support a team that size [1].
Sony's Guerrilla Games has been rebuilding Horizon Hunters Gathering since June, stripping out the always-online part and shrinking it into a smaller co-op game with a story mode [2].
Guerrilla staff were told they have until December to impress executives, and many are moving to a second project judged on the same deadline [3][4].
Players carry the ending: Konami switches off Castlevania: Grimoire of Souls on 3 September and it becomes unplayable, while Riot is refunding purchases and leaving 2XKO's servers on beyond 2026 [5][1].
Microsoft is cutting 3,200 Xbox jobs this financial year, and union members rallied outside studios in seven North American cities on 19 August [6].
The people are re-forming small: Black Pony Immersive has 26 staff, Pretty Cool Games has four, and Wolf Haus is building an open-world game with twelve [7][8][11].
The tools are moving the same way: the free engine Godot is now the choice of 12% of surveyed developers, three Epic veterans are building a rival engine aimed at small teams, and one agency raised $1m for a system that tells funders which games are not worth making [20][21][14].

Forces in play

Cost of staying open High↑

Riot ended a game people still play because the monthly cost of running it outran the money coming in [1]

Big-publisher retreat Building↑

Sony cut the always-online plan out of its Horizon spin-off; EA staff describe deep unease after the $55bn Saudi-led buyout, and a former manager expects the new owners to back sport and let the rest go [18][19]

Small studios forming Building↑

Black Pony at 26 people, Pretty Cool at four, a worker-owned co-op with no funding at all - all founded out of the layoffs [7][8][9]

Cheap tools spreading Easing↓

the free engine Godot is now the choice of 12% of surveyed developers, up eight points in a year, and won a jam that Unity had led for nine [20]

In play Riot Games — ending active development on 2XKO in December; refunding purchases Guerrilla Games — rebuilding its Horizon spin-off smaller, with a December deadline Konami — switching off Castlevania: Grimoire of Souls on 3 September CWA union members — rallied outside Xbox studios in seven cities over the 3,200 job cuts Makers Fund, WINGS, Inner Pocket — the money re-forming around much smaller games

How it unfolded

Earlier in 2026 Riot cuts about 80 jobs from 2XKO, saying the game cannot support a team that size [1]
June Guerrilla starts rebuilding Horizon Hunters Gathering after poor private testing [2]
17 Aug Konami announces Castlevania: Grimoire of Souls shuts on 3 September [5]
19 Aug Union members rally outside Xbox studios in seven cities; three new small studios are announced in two days [6][7][8][9]
20 Aug Riot disables purchases in 2XKO and begins refunds [1]
December Active development on 2XKO ends; Guerrilla's deadline to convince Sony falls due [1][3]

Where this points

Watch whether Guerrilla's December review ends with a smaller finished game or another closure - that is the test of whether shrinking a live game is a real option or just a slower way of shutting it [3][4].

Full briefing

The team is the bill

Riot did not say 2XKO was bad. It said engagement “stayed relatively flat despite larger updates,” and that the game costs “substantially more to operate than it brings in” [1]. Flat, not falling. Earlier this year Riot had already cut about 80 jobs from the team [1]. Its executive producer said then that the game was not reaching the level needed to support a team that size [1]. That is the mechanism said out loud. The team is the bill, and the bill arrives every month whether the players do or not.

Sony’s version of the same sum

Sony’s move looks like a different kind of story, and the arithmetic underneath is the same. Guerrilla Games has been reworking Horizon Hunters Gathering since June after poor private testing, stripping out the always-online part and cutting the scope [2]. Almost the whole studio has been on that game for years [3]. Staff have until December to convince executives, and many are moving onto a second project judged on the same deadline [3][4].

The two reports are not equally solid. Riot published its decision, with dates and refunds attached [1]. Bloomberg’s Horizon account rests on people who spoke anonymously, and Sony has not confirmed it [2]. The trade press has matched it, not independently verified it [3][4].

Who is left holding the ending

What a running cost does to a player has no tidy number. Konami switches off Castlevania: Grimoire of Souls on 3 September, and the game becomes unplayable [5]. Riot is refunding purchases and says 2XKO’s servers stay on “beyond 2026” [1] - a gentler ending, still an ending somebody else picks. In the same week GOG rebuilt a 2003 Prince of Persia so it runs natively on modern PCs, after Ubisoft cancelled the remake [22]. One of those two games will still exist in ten years, and it is the old one.

Where the people went

The other half of the week is where the people went. Microsoft is cutting 3,200 Xbox jobs this financial year, and union members rallied outside studios in seven cities on 19 August [6]. Two years after Microsoft closed Arkane Austin, Harvey Smith’s team resurfaced as Black Pony Immersive with 26 staff [7]. Human: Fall Flat veterans opened Pretty Cool Games with four people and a plan for ten [8]. Wolf Haus is building an open-world game with twelve [11]. Money is following them down: Makers Fund raised $250m [12], WINGS now wants pitches at $500,000 or less [13], and Inner Pocket caps itself at $75,000 a project [10]. The Guardian calls it a counter-economy forming while the big publishers retreat into safer bets [15]. It escapes none of the same arithmetic. Observer Interactive left its publisher this week and now funds the last stretch of its game itself [16]. And the pot everyone draws from is shrinking: US spending on games, hardware and accessories fell 10% in July, to $4.5bn [17].

02 · Lesson · why it matters

Why a thing that never finishes has to keep proving itself

A finished thing is judged once, but a thing you have to keep open is judged every month against a bill that never pauses.

How it works

A finished game is paid for once and then costs nothing to exist
An always-online game has a team, servers and updates to fund every month
So it must clear that bill again and again, not once
Standing still no longer means surviving - the bill does not stand still with you
The cheapest way to lower the bill is to cut the team
And a smaller team cannot hold up the game that justified the big one

The twist

Staying level is a fine result for something you finished and a fatal one for something you have to keep open - which is why a game with real players can still be switched off.

Where you've seen this

A restaurant against a cookbook

the recipes keep earning quietly forever; the room has rent due on the first of every month

A hospital wing

the building was the cheap part - the staffing is what has to be found again each year

A free software project

the code is written once, but somebody has to answer the bug reports for a decade

A subscription anything

the seller needs you back next month, so flat is failure even when nobody has left

The catch

The running cost is a design choice, not a law of nature - and it buys something real, because a game that stays open is a game that can be fixed.

Full lesson

Nobody said the game was bad

Riot’s own words are the strange part. Engagement stayed relatively flat despite larger updates. The game cost substantially more to operate than it brought in.

Read that twice. Flat. Not collapsing, not abandoned, not hated. People were still there on the last ordinary Tuesday. And that was the finding that ended it.

A game you buy once does not have this problem. It sits on a hard drive and costs nobody anything. It can sell four copies a month for twenty years and still be, in the only sense that matters, alive.

The team is the bill

An always-online game is not really a product. It is a room that has to stay open.

Rooms have rent. Here the rent is mostly people: designers writing the next update, engineers keeping the servers up, someone reading the reports of players behaving badly. That cost lands every month, in full, whether or not anyone comes through the door.

So the question stops being “is this good” and becomes “did this month clear this month’s bill.” Those are completely different questions, and only the second one has a deadline.

Riot said the second question out loud months before the ending. It cut about eighty jobs from the team and explained why: the game was not reaching the level needed to support a team that size. That is not a judgement about quality. It is a statement about arithmetic.

Standing still stops being safe

For a finished thing, flat is survival. Sales tick along, nobody has to do anything, the thing persists.

For a thing you keep open, flat is a slow ending. The bill does not flatten with you. Wages rise, the servers keep running, and the audience you have is the audience you will have. Every month you stay level you fall a little further behind a cost that never agreed to stay level.

That is why the lever everyone reaches for is the team. It is the only part of the bill you can cut quickly. But the team is also what makes the game big enough to justify a big team. Cut it and the game shrinks. Shrink the game and the reason for the room goes with it.

Where the room’s tenants end up

Somebody is inside every one of these decisions who did not get a vote.

Konami is switching off a Castlevania game in September, and when the servers go dark the game is simply gone. Not worse. Gone. Riot is being gentler: refunds are going out and the servers stay on past this year. It is still an ending chosen by someone else, on a schedule set by someone else’s spreadsheet.

Meanwhile GOG spent the same week doing the opposite to a Prince of Persia game from 2003. It rebuilt the thing so it runs properly on a modern computer. Nobody has to keep paying for it to exist. That is the whole difference: one of those games has a landlord and one of them does not.

And the same arithmetic reaches the people who make them. Microsoft is removing 3,200 jobs from Xbox this year. The developers walking out of those buildings are not leaving the industry. They are re-forming at four people, at twelve, at twenty-six, at a size where an ordinary month clears an ordinary bill.

The part that is a choice

None of this is a law of nature.

An always-online game has a running cost because somebody decided it should. A room you keep open can be sold to the same person again next month. A finished thing can only be sold once. That decision was made upstairs, years before any of these games launched. By now it looks like the natural shape of a video game, rather than one option among several.

It buys something real, too. A game that stays open is a game that can be fixed, balanced, added to. The version you play in year three is usually better than the one that shipped.

But it means the thing you paid for is a tenancy. And a tenancy is held on someone else’s terms, by someone reading a different number than you are. From inside the room, the game feels the same on the day before the announcement as it did the week before. The bill is not visible from where the player is standing, and it was never really about you.

03 · Lab · your turn

The Keep-It-Open Ledger

Run a live game for three years and feel how a bill that never pauses turns standing still into an ending.

04 · Hope · carry this

When the big rooms closed, the people who make games did not leave; they started again at four, at twelve, at twenty-six. Skill turns out to be much harder to switch off than a server.