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Crytek is struggling to make ends meet

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Although they are the original creators of the Far Cry and Crysis series and have had some interesting games and game announcements come out in the past year or so, Crytek seems to be struggling on a few hurdles that they haven’t managed to cross over. The 800-man company stretched across more than five countries is currently in a bit of a crisis themselves, with layoffs at their UK-based studios happening this week and a number of people and publications coming forward to discuss how the company is not doing very well right now. Can they avoid another THQ saga?

The first reports of the company faltering came from German-based magazine Gamestar, which carried an exclusive piece titled “The vultures are circling over Crytek,” published on 21 June. The article goes on to detail how Crytek was having difficulties securing additional funding for the company, how their military contracts weren’t bringing in as much money as previously thought and how Ryse: Son of Rome‘s development for the Xbox One was so behind schedule in 2013 that additional teams in the company had to drop what they were working on to complete it.

In addition, Microsoft wanted to sign Crytek up for a sequel, but only if they could have exclusive rights to Ryse as well as transferring ownership of all trademarks and intellectual property. This piles up with Crytek’s efforts in the free-to-play market not going according to plan, with little revenue being generated. Even CryEngine, now available on Steam for less than id’s Unreal 4 Engine, isn’t getting many takers.

The article also cites Avni Yerli, one of the three Yerli brothers who founded the company, saying that they had recently struck a deal for a cash injection, but it wasn’t set in stone yet. This might be the main reason why there hasn’t been another game from the company published by Electronic Arts in some time, as well as the motive behind recent moves they’ve made to get self-published on the ID@Xbox program and on iOS and Google Play platforms.

Yesterday Eurogamer learned that the company’s UK offices were seeing a mass exodus of staff following the development of a new Homefront game once Crytek had acquired the licence from the sale of THQ’s intellectual property. Over 30 people have left since 2011, many of them holding key positions in the company.

On condition of anonymity, staff told Eurogamer that Crytek has been withholding salaries from some employees for months, with bonuses being canceled at the end of 2013. Some of the ex-UK staffers have gone on to work for Cloud Imperium Games, the makers of Star Citizen. Karl Hilton, one of Crytek’s board members and the co-founder of Free Radical Design (the Time Splitters developers) who morphed into Crytek UK in early 2009, left the board and is currently redeployed in another part of the company to help speed up certain projects.

In addition, Crytek UK is the studio working on Homefront: The Revolution, which is slated for a Q3 or Q4 2015 release on the Windows PC, Xbox One and Playstation 4 platforms. Its anyone’s guess at this point how development of the game is going, but it’s probably not doing as well as it could be.

Crytek does have the chance to pull through and get back on its feet, but it’s going to be a while before they are financially stable again. I hope that HUNT: Horrors of the Gilded Age and Homefront allow them to get them back up again.

Although all they really need to do is make another open-world Crysis game.

Sources: Eurogamer, Kotaku, Gamestar, NeoGAF

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  • Miklós Szecsei

    It’s also worth noting that Crytek is denying all of this and is calling that Gamestar article a rumour. The Crytek UK exodus, however, is legit seeing as departing employees provided a list of names to Eurogamer. There’s no smoke without a fire; there’s definitely something bad happening here.

    “Quick guys, lets throw the vast majority of our eggs into that basket labelled ‘Free-to-Play’! Nothing will possibly go wrong!”

    If this is actually happening, and Crytek is in trouble, then it’s just a terrifying reminder of how quickly stuff can unravel in this industry.

  • FanieNel

    “Although all they really need to do is make another open-world Crysis game.”

    If they do this, it better be good. The first Crysis game was ok, Warhead was awesome, 2 and 3 were such huge disappointments. Their tech is amazing, I actually spoke to someone at work who uses the CryEngine, one set back of the engine is that you MUST be connected to the internet the whole time. It might have changed, but I’m still sticking with the Unreal Engine 4.

    “Microsoft wanted to sign Crytek up for a sequel, but only if they could have exclusive rights to Ryse as well as transferring ownership of all trademarks and intellectual property.” So they want to get the IP for themselves, so they can squeeze the most money out from it, while Crytek only gets a bit of it. That sounds a bit unfair in my opinion.
    Microsoft is one company that is deliberately trying to ruin the gaming industry with time exclusivity, and a bunch of other crap.

    I’m really looking forward to HUNT: Horrors of the Gilded Age and Homefront. I really hope it isn’t as bad as they say.

  • Squirly

    I’ll be honest, I might not have been waiting for this news, but I was almost expecting it. You can’t spend millions on shiny but unsatisfying games that seem to only break even (from the looks of it) and then expect to still run a business.

    Crytek have been trying to compete with the big boys, and while their tech might be up to snuff, their games (and their sales) aren’t.

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