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GameGeex - 38 Studios collapses under weight of debts to Rhode Island Things aren't looking good for the Reckoning developer, and that spells doom for the taxpayers of Rhode Island.

It doesn't look good for Curt Schilling and 38 Studios, makers of Kingdoms of Amalur: Reckoning.  Over the course of the last few days an issue with the developer's financial standing has come to light, which is making the state of Rhode Island very nervous. Why is that?  Because the state leant 38 Studios $112.6 million dollars, and now is looking to collect a payment of $1.125 million.  Now that's a big check to write.

Today things took a turn for the worse, and 38 Studios had to cut a check to the Rhode Island state government, at the expense of payroll.  Contractors were let go, but it seemed at least alright until the developer's COO had to admit that there wasn't enough money in the bank to back the check.  Rhode Island returned the useless piece of paper, and everyone involved clenched their teeth.  At the moment, now that the day is tumbling toward its end, it seems Curt Schilling is either stepping away from 38 Studios, or is being used as the scapegoat for the entire debacle, because he's now been removed from the company website.  

I don't see how this is going to end well, and much of it is reminding me of Flagship Studios and their complete collapse back in 2008.  The trouble is that this time, the markers are in the hands of the taxpayers of Rhode Island, and to default on the loan would mean harsh times for the state that put so much support behind 38 Studios.  I suppose it's possible that a larger gaming company -- Nexon, or EA, or even Perfect World -- could step in and throw money into the hole until it fills up, but that seem likely.  For the moment the gaming industry as a whole is holding their breath, hoping that things will turn out okay for 38 Studios, and thanking whatever deities they worship that they aren't in Curt Schilling's shoes.

[via Joystiq, source WPRI]

1 Comments for this post.
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Wow O.o that's big. Maybe Rhode Island should throw some money into Call of Duty this year to try and make the return (._.)


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