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Layoffs confirmed for 38 Studios, Rhode Island takes no action
If last week's Project Copernicus flythrough had been a hopeful note, the latest news out of 38 Studios is another downturn. Following a meeting today, the Rhode Island EDC board decided to take no action to help the ailing company at this time. Governor Lincoln Chafee said following the meeting that the financial situation of the studio remains unchanged from last week, but did note that the company has seen some layoffs and underwent unspecified internal shifts. Founder Curt Schilling did not directly respond to press inquiries, stating that he would answer questions when he is able to do so. He did, however, state that he was not taking further taxpayer money. Whether or not there will be a company there to take any money in the near future is still very much in doubt, however, and while Chafee has been a bit more diplomatic about aiding the studio, he has stressed that any assistance would be far on the conservative side.
38 Studios' Project Copernicus to release in June 2013, says RI governor
It is not every day that a U.S. governor is the one to announce the launch window for an MMO, so savor the weirdness while you can: Rhode Island Governor Lincoln Chafee announced at a press conference that 38 Studios will be releasing code-name Project Copernicus next summer. "What I understand is Copernicus is June of '13," Chafee said. He also stated that he thought the financial deal was a "risky enterprise" from the start. 38 Studios Founder and Chairman Curt Schilling said on Facebook that rumors of his using the state funds to repay his personal investment in the company was "not true." In a separate post, Schilling attempted to set an optimistic tone: "We will find a way, and the strength, to endure." We have been following the financial turmoil that 38 Studios is in following its default on paying back Rhode Island for its $75 million loan. The studio and state are looking for options, but in the meanwhile, 38 Studios has been struggling to make payments by holding back employee paychecks and seeking additional capital from private investors.
Rhode Island governor gives 38 Studios' Copernicus MMO a June 2013 launch
Rhode Island governor Lincoln Chafee told attendees of a 38 Studios-related press conference that the long awaited 38 Studios MMO – only known currently as "Project Copernicus" – is set to launch in June of 2013. Chafee said, "What I understand is Copernicus is June of '13."Considering we've literally never heard any information on the Amalur-based MMO (aside from the fact that it's an Amalur-based MMO), it's a bit hard for us to believe that the game will arrive by next year. "I said from the beginning that it was a risky enterprise," Chafee told press of the troubled business deal between 38 and Rhode Island.38 Studios is supposed to start paying back its $75 million loan – facilitated by the state of Rhode Island and supported by bond investors – by the beginning of 2013. It's unclear how 38 will afford those payments, but Chafee repeatedly pointed out 38's intention to seek private capital (read: more money from private investors – and not from the state). Said private capital has yet to be secured, Chafee said.
38 Studios successfully pays $1.125 million to Rhode Island
38 Studios's $1.125 million check to the state of Rhode Island has cleared, governor Lincoln Chafee announced during a press conference this afternoon, thus fulfilling the first required payment on the studio's loan from the Rhode Island Economic Development Corporation.Rhode Island is changing its legislation on tax breaks, closing loopholes pertaining to state funds being used for motion-picture endeavors, Chafee said. The state's interest lies in protecting the taxpayers, balanced with keeping 38 Studios solvent, since "taxpayers have had a very generous deal for 38 studios," Chafee said."It's time for them to go out and get private capital funding," Chafee said. "That's the deal. It's a generous deal, but stick to it."Rhode Island officials believe that the total of the $49 million loaned to 38 has been spent. Chafee said that until late April, meetings with 38 suggested that they would make their May payment. "I want to make sure we're doing everything possible to make sure 38 doesn't fail," Chafee said. "We're in deep." Everything possible except giving them more money."There's not going to be any money from the state. They're not coming here for easy money."According to Chafee, "Basically, the access to private capital hasn't materialized."38 Studios' next payment is a debt service payment due November 1 of $2.6 million, and Rhode Island officials believe the studio will have the capital to cover it.38 Studios will then owe $12.6 million in full annual debt service in 2013, and "that's on their dime," officials said.Chafee said he recognized the risk involved in starting a new gaming studio, but the state would have benefited greatly from the studio's "huge success" had it done well."I said from the beginning that it was a risky enterprise," Chafee said. Regarding how 38 Studios will function if it doesn't have the funds to pay its employees, Chafee reiterated, "Again, these are the ramifications of being in a risky business."Chafee doesn't plan on taking a gamble of this nature again: "Never, never ever. Not under my watch," he said.
38 Studios paying state back by not paying employees
If you're familiar with the phrase "robbing Peter to pay Paul," you'll understand the latest episode in the ongoing 38 Studios financial crisis. Except replace "Paul" with "the state of Rhode Island" and "Peter" with "the company's employees." Yes, in order to make the most recent payment to the state that sparked this whole crisis, the Rhode Island Economic Development Corporation has been informed that Curt Schilling's company is paying the state but not paying any of the company's employees. According to anonymous sources, all temporary employees and contractors have also been terminated. While this measure might help forestall immediate action, the company is still on the hook for a $75 million loan, and Rhode Island governor Lincoln Chafee has made it clear that the company is looking for more assistance from the state in order to remain viable. 38 Studios continues to make no public statements at this time. We'll no doubt have more on this story in the coming days as it continues to develop.
The scene following 38 Studios' 'emergency meeting' with Rhode Island officials
To get a real sense of the severity of the situation between 38 Studios and the state of Rhode Island, here's a package by the Providence Journal. The events shown immediately follow today's "emergency meeting," where officials decided they didn't know what to do about the studio.
Rhode Island owns Amalur, all other 38 Studios intellectual property if studio defaults
If 38 Studios does shutter, beyond Rhode Island taxpayers having to pay off the $75 million bond (plus interest) through 2020, it appears the state will also own the intellectual property of the developer as a parting gift. Reviewing updated documentation released by the Rhode Island Economic Development Corporation (RIEDC) today, it appears 38 Studios put up all present and future IP by the company as collateral.According to the documentation, 38 Studios' intellectual property rights and other collateral were pledged to the RIEDC and assigned to a trustee, which we've confirmed by pulling Uniform Commercial Code documentation. Any proceeds made from the sale of the collateral would go back to the bondholders. This covers "all rights, title and interest in any projects, including video game projects," such as Kingdoms of Amalur: Reckoning and "Project Copernicus" – the title currently in development at 38 Studios."Based on what information I've been able to review on the 38 Studios situation, it appears that the funds they received from the RIEDC were secured by collateral that amounts to all of 38 Studios assets, including all of their intellectual property," attorney and Law of the Game editor Mark Methenitis told Joystiq this afternoon. "That would include all the rights to Kingdoms of Amalur and any other games they may have in development, even if no information about those titles has ever reached the light of day."
38 Studios, Schilling ask Rhode Island for more money; state officials freeze
Today's emergency meeting by Rhode Island officials to determine what they are going to do about Curt Schilling's 38 Studios has concluded with officials freezing like deer in headlights. Nothing happened.Rhode Island's Economic Development Corporation will take no immediate action to aid the developer, following a closed-door meeting attended by Governor Lincoln Chafee and Schilling, who asked for additional help to save the company. Schilling refused to answer press inquiries and officials wouldn't declare how much money the studio is seeking."How do we avoid throwing good money after bad?" Chafee is quoted by the Associated Press as saying after the three-hour emergency meeting finished."The company still has the option to cure the existing default by paying the $1,125,000 guaranty fee that is past due," reads an official statement by the EDC board. "In the meantime, we will continue to talk with 38 Studios and develop additional information, and will resume the Board meeting at our regularly scheduled meeting on May 21. The members of the Board may not discuss the confidential information received and discussed today."If the studio doesn't receive assistance, it appears Rhode Island taxpayers may very well be on the hook for the $75 million 38 Studios loan that, after interest, would require paying back $112.6 million through 2020.
38 Studios whiffed last loan payment, received nearly $50 million from Rhode Island thus far
The hits keep coming for ex-baseballer Curt Schillings' 38 Studios. The company reportedly missed its latest loan payment of $1.125 million to the state of Rhode Island on May 1, effectively defaulting its $75 million loan. WPRI spoke with Rhode Island House Speaker Gordon Fox who confirmed the news.The loan's facilitator, Rhode Island's Economic Development Corporation, called an "emergency meeting" for tomorrow morning, wherein it will discuss "an unexpected occurrence that requires immediate action to protect the public regarding the 38 Studios financing." As reported earlier, if 38 Studios were to fully default on its loan obligations to investors supplying the loan via the Rhode Island government, the responsibility would fall to Rhode Island's taxpayers – to the tune of $112.6 million.Of the $75 million borrowed by 38 Studios from the state of Rhode Island, $49.8 million was received by the studio as of March 15, WPRI reports. Given that, it seems worrisome at best that 38 Studios was unable to fulfill its recent payment of $1.125 million. 38 Studios is working on the Kingdoms of Amalur MMO – the game was originally promised for a launch ahead of 2013, when 38 Studios is set to begin paying back bondholders on its $75 million loan. It's unclear what stage its MMO is at, and 38 Studios hasn't made a public statement regarding its recent issues.[Image credit: 38 Studios]
Rumor: 38 Studios may be having financial trouble
38 Studios is one of many developers whose first big game (Kingdoms of Amalur: Reckoning) was rumored to lead into an MMO further on down the line. It looks like there may be storm clouds on the horizon before that project even gets moving, however, as the company may be facing financial issues. Rhode Island Governor Lincoln Chafee has apparently been meeting with owner Curt Schilling to work on "different issues," with Chafee noting that his administration has always tried to ensure that Rhode Island companies remain financially solvent. If you consider that Rhode Island invested about $75 million in the company, it's obvious that the government has an interest in making the company remain viable over the long term. Kingdoms of Amalur: Reckoning was a moderate hit, but that might not be enough for the company as it develops. We'll have more on this story as it develops, hopefully with better news.
Rhode Island gov working hard at 'keeping 38 Studios solvent'
Reckoning, indeed! A developing story out of Rhode Island has Governor Lincoln Chafee talking in uncertain terms about the financial condition of Curt Schilling's 38 Studios, which the state gave a controversial $75 million loan to a couple years back to move down to Providence.The Providence Journal reports Gov. Chafee, who was against the loan during his election, spent a "weekend of work on this subject," but wouldn't go into specifics. "We're doing everything possible, like I would for any Rhode Island company," he said this afternoon. The Journal reports he added the work was about "keeping 38 Studios solvent.""We're concerned and just doing everything possible to ensure that 38 Studios stays part of the Rhode Island community," Governor Chafee told WPRI.com. "We're working on different issues with them." Asked if 38 Studios' issues could be resolved, Chafee said, "We're working on it."
Curt Schilling on 38 Studios' MMO and the move to Rhode Island
It's been nearly half a year since the deal was signed, but 38 Studios head Curt Schilling tells us that his company's "150 - 160" employees are already in the process of moving to Rhode Island. That includes full relocation for everyone involved (read: selling that dream Boston house for a cottage in Quahog), though the company's own website still reflects 38's original address. Surprisingly, he says morale hasn't been affected negatively. "The team is incredibly excited. It's our building! We have all six floors -- it's our studio and we're alone. It's our space," Schilling explained to us this afternoon at a San Francisco club-turned-EA event. "Gavin -- the studio GM -- and I, we really took a Disney approach," he said. "There's no detail too small for us in the new studio to make it a place where people walk in and say, 'I wanna work there.'" At the time, he wouldn't say much about what exactly the happy folks inside his company's new digs are making.
38 Studios is looking for a few good men -- and women, too, of course!
38 Studios has kept its Project Copernicus MMO under tight security for a while now; however, we do know that the studio has some big names in its pocket. Comic book giant Todd McFarlane, award-winning author R.A. Salvatore, and baseball great Curt Schilling have already added their talents to the roster. Even the government of the state of Rhode Island is excited about what this team is doing, given the guaranteed loans 38 Studios was offered if it moved to the state. Today, Lead Community Manager Charles Dane tweeted that the team is LFM. He posted, "38 Studios is looking for top tier talent. This is a great opportunity to join an awesome team!" A buzz over to the jobs page for the studio shows that it is looking for an abundance of people. QA, engineering, art, and even finance are on the list of departments needing minions. Who knows? Maybe you are the top-tier talent the studio is looking for.
Fallout's Vault Boy does your dry cleaning, apparently
Vault Boy isn't just a Vault-Tec mascot in the post-apocalyptic wasteland -- he's also been spotted recently representing a Providence, Rhode Island-area dry cleaners (as seen after the break). Here's hoping those clothes don't come back glowing with radiation!
The Perfect Ten: The movers and shakers of 2010
Even though MMOs are the products of great teams of talented workers -- from sound artists to writers -- it's inevitable that a few of the people behind the curtain step out into the limelight. It's a smart move, really; it provides a personal face for people to associate with the game, it keeps messages consistent, and it draws any potential hate onto one person instead of the team at large. It stands to reason that these public figures end up being some of the major movers and shakers in the industry because of their high-profile positions. From CEOs to community managers, these are the people with power to make decisions, the voice to change opinions, and the personalities to inspire millions. Oh, that last sentence is pure poetry. Let's re-read it again, shall we? So in our last Perfect Ten of the year, I've asked the Massively team to compile a list of the 10 biggest MMO movers and shakers of this year. All of these people now owe us cupcakes of gratitude. (Legal Disclaimer: This does not signify a binding cupcake-blogger contract.)
38 Studios Rhode Island deal still up in the air
Just when we thought 38 Studios' epic quest to move its guild headquarters to Rhode Island was nearing its conclusion, a posting on the blog of a local television news outlet casts a bit of doubt on the successful outcome of the proceedings. Reporter Ted Nesi writes that the state's Economic Development Commission is itching to close the $75 million loan it's taken out for 38 Studios. However, if Lincoln Chafee wins the governorship in today's election, it could trigger a showdown, given the candidate's outspoken criticism of the deal. The other leading candidate, Frank Caprio, has said that if elected, he will "march down to EDC headquarters on Wednesday to do something unspecified about 38 Studios." In other 38 Studios news, Amazon has recently published the official box art of Kingdoms of Amalur: Reckoning, the first official game to come out of Curt Schilling's company (currently slated for a September 2011 release). Check out the details, as well as a new screenshot, at 38gamers.
38 Studios announces official Rhode Island relocation
The lengthy saga of 38 Studios' relocation looks to be drawing to an end, as the fledgling game company has published a press release touting the impending lease of an office building in downtown Providence, Rhode Island. Originally headquartered in Massachusetts, the developers behind the eternally cryptic MMORPG code-named Copernicus were offered a loot bag full of $75 million in loan guarantees by the Rhode Island Economic Development Corporation. The relocation will generate 450 high-paying tech jobs, and state governor Donald Carcieri lauds it as a move that will "provide job opportunities for our college graduates in a fast growing industry, and will attract other interactive and entertainment companies to Rhode Island."
38 Studios' move to Providence, RI is official
38 Studios, with millions of dollars coming its way from the state of Rhode Island, officially announced its move to Providence today. The untested developer will be headquartered in the state capital at One Empire Plaza, not far from Rhode Island School of Design and Brown University. 38 Studios was launched by former Red Sox player Curt Schilling in 2006. "38 Studios presents Rhode Island with a tremendous economic development opportunity," said Governor Donald Carcieri. "This investment creates 450 high-paying jobs, provides job opportunities for our college graduates in a fast growing industry, and will attract other interactive and entertainment companies to Rhode Island." However, WPRI notes that 38 Studios can actually get $64 million (of a total $75M) from the state through only employing 250 by December 2011. Several Rhode Island gubernatorial candidates have expressed concern over the agreement with the studio, but it appears the deal is done now. %Gallery-98022%
38 Studios' loan from Rhode Island detailed in new report
Thanks to documentation from the Rhode Island Economic Development Corporation, we now have a better idea of the terms involved in 38 Studios' controversial move from Massachusetts to R.I. Obtained by WPRI, the report kinda explains what's going on: 38 Studios will receive $51 million from the state; $13 million as soon as Curt Shilling's studio signs the contract to move and another $38 million as the company achieves milestones over the next 15 months. The remaining $20 million is held in some reserve to assure three years of debt payment, which is tied to other caveats. 38 Studios also has a strict job creation schedule over the next three years. The developer must have 125 full-time jobs within a year of signing for the loan, another 175 the following year and 150 more the year after. That may just be numbers to many of you out there, but industry human resource representatives and studio directors just spit coffee all over their monitors. The studio will be penalized $7,500 per year for each of the 450 jobs it doesn't create. Obviously, if you do the math, it's cheaper not to hire for the full-time job and take the penalty. 38 Studios must also announce the location of its new studio operations and corporate headquarters by November 30, 2010 -- note: the company just has to say where it's going, not actually get there. Also, the closing of the loan requires a "signed, enforceable" 10-year lease for 38 to stay in Rhode Island. Looks like R.I. wants to make sure that it's not paying to raise a studio -- which, to date, hasn't released a single project -- and watch it leave for California or Canada after it gets all that cash.
38 Studios relocation loan in jeopardy
Democratic Rhode Island gubernatorial candidate Frank Caprio has flip-flopped in his stance towards a $75 million loan from the state's Economic Development Corporation to fledgling game maker 38 Studios. The development house, founded in 2006 by former Major League Baseball pitcher Curt Schilling, is hard at work on the top-secret Copernicus MMORPG and was offered the lucrative deal in exchange for moving the company's headquarters from Massachusetts to Rhode Island (and bringing a proposed 450 high-paying jobs to the state's economy). Caprio, who currently serves as Rhode Island's general treasurer, is one of several political candidates condemning the deal, a marked change from his views in past weeks, notes the Boston Globe. "I am not going to stand by and watch us gamble taxpayer dollars on a bad deal when there are thousands of small businesses in need of more access to capital," Caprio said in a press release dated August 31st.
