The gaming industry is experiencing a shake-up, and Bandai Namco Holdings Inc. is the latest company to announce layoffs and project cancellations, making waves in the already troubled sector. Rising development costs and declining demand are forcing industry giants to reconsider their strategies—and Bandai Namco is no exception.
Bandai Namco: A Legendary Name, Facing Tough Decisions
Known for iconic franchises like Dragon Ball and Gundam, Bandai Namco is a historic player in the gaming world. From the glory days of Pac-Man in 1980, the company has grown into a multi-billion dollar entity with a vast array of console, PC, and smartphone games under its belt. But the world has changed, and so has the gaming landscape. Post-pandemic, users have less time for games, and the appeal of certain titles is waning, forcing companies like Bandai Namco to pivot.
The Tokyo-based company recently made headlines for cutting its workforce, discontinuing games, and rethinking its approach to the modern gaming market. But it’s not just Bandai Namco feeling the pinch—this is part of a larger trend affecting the entire gaming sector.
The ‘Expulsion Rooms’ Pressuring Workers to Leave
In Japan, where labor laws are notoriously strict, corporations have had to get creative when reducing their workforce. Enter oidashi beya, or “expulsion rooms.” These are offices where employees are assigned no tasks, effectively pressuring them to resign out of sheer boredom and frustration.
Since April, Bandai Namco Studios has reportedly moved 200 employees to these rooms, with around 100 already resigning. The company denies using expulsion rooms to force employees out, stating that some workers are simply waiting for new projects to start. However, it’s clear that these rooms have a way of making employees reconsider their options—especially when finding other work becomes a higher priority than staring at a blank screen all day.
Game Cancellations Pile Up
The workforce reductions aren’t the only sign of trouble for Bandai Namco. The company has also been cancelling or pausing the development of numerous titles. This includes smartphone games like Tales of the Rays and the ambitious online game Blue Protocol, which will officially shut down in January. Even projects with beloved anime characters like Naruto and One Piece haven’t been spared.
Most shocking, perhaps, is the cancellation of a project commissioned by none other than Nintendo, a move that illustrates just how severe the situation has become. The company racked up ¥21 billion ($141 million) in writedowns over the past three quarters—losses that are becoming hard to ignore.
Rivals Feeling the Heat Too
Bandai Namco isn’t the only company facing these issues. Square Enix and Sony have also been making tough calls, with Square Enix cancelling several smartphone games and Sony pulling the plug on Concord, an online game that had only been launched two weeks prior.
Across the industry, companies are finding that the enormous development costs of modern games are harder to justify. Gamers, once eager to spend their free time and money on the latest releases, are now pickier than ever. And let’s be honest—who has the attention span for another big-budget smartphone game when there’s a world of entertainment fighting for our time?
What’s Next for Bandai Namco?
Bandai Namco’s recent moves suggest that the company is grappling with significant internal and external pressures. While it may be downsizing its staff and cutting projects, the company insists it’s not trying to force anyone out and will continue to assign new projects to employees as they arise.
In reality, Bandai Namco—and the gaming industry as a whole—faces an uphill battle. With post-pandemic gaming trends shifting, increasing development costs, and gamer attention spans dwindling, companies are being forced to make hard decisions. For now, Bandai Namco is focused on weathering the storm, but it’s clear that further changes may be necessary to keep the company afloat.
The Bigger Picture: Is This the Future of Gaming?
As Bandai Namco and other gaming giants re-evaluate their strategies, one can’t help but wonder if this is the new normal. The golden age of gaming may be behind us, and as costs rise and demand falls, companies will likely have to cancel more games and restructure their teams. It’s a sobering reality for an industry that once seemed unstoppable.
But where does that leave the gamers? For now, we’ll have to wait and see. One thing’s for sure: the days of rapid-fire game releases and endless sequels may be coming to an end.
What Do You Think?
What do you think about Bandai Namco’s strategy? Are we seeing the beginning of the end for big-budget gaming? Share your thoughts in the comments below.
