Stargate Worlds studio faces cash flow issues

Get ready for some dubious corporate drama. We were contacted by a tipster claiming to be a Cheyenne Mountain Entertainment employee. He or she alleged, among other things, that CME/Firesky is in critical financial condition -- that it has accrued a large debt, that massive layoffs are planned, and that the future of Stargate Worlds might be in jeopardy. Knowing full well that potentially-scorned anonymous employees are rarely a wholly reliable source, we contacted the company and provided them an opportunity to comment.

We were told that the tip was full of inaccuracies and overstatements. The official comment was this: "Cheyenne Mountain Entertainment is a start up, and like many start ups, we face the typical cash flow issues that all pre-revenue companies face. CME continues to fund its operations in the same way it has done for three years and the viability of the Stargate Worlds project is not in question. We fully expect to complete and ship Stargate Worlds in 2009."

Marketing guy Kevin Balentine assured us that large-scale layoffs are not planned, and that the company's other two projects are moving along as well.

There is an admission here that there are some financial problems, but the true extent is not clear. Despite this, the company has engaged in extravagant marketing endeavors like a caravan of custom Hummers. We're not sure what to make of that.

It would be a shame to lose all that's been invested now. That the failure of the project would be a waste doesn't necessarily mean it won't happen anyway, though. That said, our educated guess is that Stargate Worlds is not in imminent danger of cancellation. The exact numbers provided by the tipster seemed a bit outrageous, and the project is very far along in development.

Stargate Worlds reps have promised that the closed beta test will begin within the next few weeks. Stay tuned.

This article was originally published on Massively.