Stadia’s shutdown reportedly partly caused by Microsoft’s multi-billion acquisition of ZeniMax, COVID-19 pandemic

Google Stadia’s struggle to establish itself in the gaming space was finally cut loose on Feb. 1—though at the expense of more than one hundred bewildered developers committed to the cause.

There was an “apparent pattern of Stadia leadership not being honest and upfront,” according to a report by Nathan Grayson and Ethan Gach of Kotaku, who interviewed multiple sources with knowledge of the matter.

During a Feb. 4 Q&A with staff, three days after the announcement of Stadia’s shutdown, Stadia’s vice president and general manager Phil Harrison pointed to several factors involved in the shutdown of the platform’s internal studios.

Microsoft’s acquisition of ZeniMax Media, which counts Bethesda and id Software among its numerous subsidiaries, the ongoing COVID-19 pandemic, and the rising costs of game development were brought up by Harrison.

Video game development cycles take several years, but in the end, the Stadia experiment lasted just 14 months. Kotaku’s sources pointed out “a severe lack of resources, difficulty securing necessary hardware and software, and a frozen headcount throughout 2020” as major problems for development, despite Stadia’s initial ambitions to release original exclusives.

“If you started this studio and hired a hundred or so of these people, no one starts that just for it to go away in a year or so, right?” said one of Kotaku’s sources. “We had multi-year reassurance, and now we don’t.”

The systemic lack of accountability in the studio’s leadership was perhaps best exemplified by Harrison’s Jan. 27 email. In a copy obtained by Kotaku, Harrison said the company “has made great progress building a diverse and talented team and establishing a strong lineup of Stadia exclusive games.” This came less than a week before Harrison’s Feb. 1 blog post saying that investment in future internal development will be halted.

Kotaku said Stadia’s developers learned the news at almost the same time as the public through an internal email and conference call with Harrison. Google is reportedly shifting affected employees to other areas within the company, though the difficult process is exacerbated by the intensely specialized skillset of game developers compared to the company’s penchant for generalists.

Stadia isn’t entirely dead in the water, however. Google plans to continue bringing third-party games, such as FIFA 21 and Far Cry 6, to the service. In total, more than 100 games will be added throughout 2021, according to a Feb. 12 blog post.