Amazon Games Shifts Strategy: Halting Major AAA Development and Pivoting to Online Experiences

Amazon Games is undergoing a significant strategic overhaul, marked by recent layoffs and a pronounced shift away from substantial first-party AAA game development, particularly in the realm of massively multiplayer online (MMO) titles. This pivot signifies a renewed focus on its cloud-gaming platform, Luna, and a broader online strategy, aiming to leverage Amazon’s core strengths in streaming and member value.

The Context: Broader Layoffs and Gaming Division Impact

These changes within Amazon Games are part of wider corporate layoffs impacting various divisions across Amazon. Reports indicate that the tech giant is looking to streamline operations and reverse some of the extensive hiring that occurred during the pandemic. While the exact number of positions cut within Amazon Games has not been fully disclosed, the reductions are described as “significant” and have primarily affected the company’s studios in Irvine and San Diego, as well as its central publishing team.

A Strategic Retreat from AAA Development

A core element of Amazon Games’ new direction is the decision to “halt a significant amount of our first-party AAA game development work – specifically around MMOs.” This move reflects a critical evaluation of the evolving dynamics within the games industry and the competitive landscape, according to Steve Boom, Vice President of Audio, Twitch, and Games at Amazon.

Historically, Amazon Games has invested heavily in ambitious AAA projects, including MMOs like New World. While New World achieved a strong launch, maintaining sustained interest in the highly competitive MMO genre has proven challenging. The previously announced Lord of the Rings MMO, for instance, appears to be among the affected projects.

Embracing an Online and Cloud-First Future with Luna

In contrast to scaling back AAA development, Amazon is intensifying its efforts in cloud gaming. The company recently relaunched its Luna platform, emphasizing accessibility, social interaction, and value for Prime members.

Key aspects of the revamped Luna include:

• GameNight: A new feature offering a collection of over 25 multiplayer party games designed for shared living-room experiences. These games, such as “Courtroom Chaos: Starring Snoop Dogg” and “Angry Birds Flock Party,” can often be played using smartphones as controllers, removing the need for specialized hardware.
• Expanded Game Catalog: Prime members now have access to a rotating library of over 50 games, including prominent titles like Hogwarts Legacy, Indiana Jones and the Great Circle, and Kingdom Come: Deliverance II, at no additional cost.
• Focus on “Console-Friendly” and Known IPs: The strategy leans towards titles that are more broadly appealing and feature established intellectual properties or familiar play patterns, contrasting with the niche appeal of some hardcore PC MMOs.

This shift positions Luna as an accessible gaming option for a wider audience, moving away from catering primarily to traditional hardcore gamers, where latency and high-fidelity graphics have often been perceived as barriers for cloud streaming.

Ongoing Development and External Partnerships

Despite the significant changes, Amazon Games is not entirely withdrawing from game development. Several projects remain active, with a greater emphasis on external collaborations and specific internal studio focuses:

• Amazon Games Montreal: This studio recently concluded a successful closed alpha for its free-to-play 4v4 war MOBA, March of Giants, and continues its development.
• Studio 5: Responsible for Luna’s launch title “Courtroom Chaos: Starring Snoop Dogg,” this team will continue to concentrate on more casual and AI-focused games optimized for the cloud platform.
• External Partnerships: Amazon Games continues to act as a publisher for titles developed by other studios. This includes a new, multiplatform Tomb Raider game being developed by Crystal Dynamics, which is currently in early development. Additionally, Amazon Games has partnered with Maverick Games, a studio founded by former Forza Horizon developers, to publish a new narrative-led, open-world driving game for PC, PlayStation 5, and Xbox Series X|S.

Implications and Future Outlook

The strategic adjustments at Amazon Games reflect a broader trend in the tech industry, where companies are re-evaluating their investments and optimizing resources. The pivot towards cloud gaming, social party experiences, and publishing externally developed titles suggests a more distributed and platform-centric approach for Amazon’s gaming ambitions. While the reduction in first-party AAA development, particularly MMOs, signals a significant change for internal studios, the continued investment in Luna and external partnerships indicates a sustained commitment to the gaming sector, albeit with a refined strategy that aligns more closely with Amazon’s established ecosystem and cloud capabilities.

Frequently Asked Questions (FAQ)

What does “halting a significant amount of AAA development” mean for Amazon Games?

It means Amazon Games will significantly reduce its internal development of big-budget, first-party AAA titles, with a particular focus on massively multiplayer online (MMO) games.

Are there still games being developed internally by Amazon Games?

Yes, Amazon Games Montreal is continuing work on March of Giants, and Studio 5 is focusing on casual and AI-focused games for Luna, such as “Courtroom Chaos: Starring Snoop Dogg.”

What is Amazon’s new focus for its gaming strategy?

The company is shifting its online strategy to emphasize its cloud-gaming platform, Luna, with a focus on social party games, “console-friendly” titles, known IPs, and publishing games from external studio partners.

Which external games are Amazon Games publishing?

Amazon Games is publishing a new Tomb Raider title from Crystal Dynamics and an upcoming open-world driving game from Maverick Games.

Conclusion

Amazon Games’ strategic recalibration, involving layoffs and a major pivot in its development focus, illustrates the dynamic and often challenging landscape of the video game industry. By stepping back from extensive first-party AAA development, particularly MMOs, and re-centering its efforts on the Luna cloud-gaming platform and strategic publishing partnerships, Amazon is aiming to carve out a more sustainable and impactful presence in gaming. This revised approach seeks to capitalize on Amazon’s strengths in technology, streaming, and its vast Prime member base, offering a clearer direction for its future endeavors in the interactive entertainment space.