In January, Microsoft announced big layoffs in its gaming division, which affected 1,900 team members. Those cuts hit Blizzard Entertainment especially hard, including the departure of its president, Mike Ybarra, and the cancelation of its unnamed survival game, which has been in development for several years. Since then, however, the company has started hiring for another unannounced game.
Today, Windows Central, using unnamed sources, is reporting that Microsoft and Blizzard have formed a new team within Blizzard that is supposed to be working on smaller "AA" games that will use Blizzard's current game IP as the basis.
The report also says that the new team was formed mostly by former team members from King, the mobile game developed by Microsoft, which it acquired as part of the Activision Blizzard purchase in October 2023.
Since this new Blizzard team has been formed largely from former King developers, it stands to reason that any new games from this team may be targeting mobile platforms like iOS or Android devices. However, as the article points out, any smaller games from the team could also target other platforms as well.
The story adds that Microsoft reportedly wants to make some changes and work on some smaller, perhaps even experimental, games that could be made without the massive costs that are associated with big AAA game teams. That doesn't mean Microsoft will abandon making those kinds of big-budget games, but many of the most successful games in the last few years were made by smaller teams.
That includes Palworld, which was a big hit for Microsoft as it quickly became the biggest third-party game launch for its Xbox Game Pass service earlier this year. Microsoft may be learning some lessons from that game. It could be making internal titles that can be made more economically and still be very successful.
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