Telltale Games to Finally Close Up Shop Following Years of Troubles

In a blow to gaming fans worldwide, the hugely popular Telltale Games studio looks finally set to close up shop for good, following a protracted period of troubles which has seen investors pull out and sales figures flatline. Telltale Games was most well-known for its unique episodic adventure games released over its in-house game engine, the Telltale Tool, which produced smash-hit titles such as the Walking Dead game, bringing in $40 million in revenue for the company back in 2012.

Things have changed a lot since then, it seems, with the last year seeing some brutal restructuring that saw all but 25 of the company’s employees being laid off, and an investor exodus that ground new developments to a complete halt. The company very recently looked set to secure a fresh round of funding, but the last investor abruptly pulled out of the company, causing a prompt collapse as the money ran out. Telltale has also spent much of the last year embroiled in legal battles and class action lawsuits, severely hampering their ability to produce the kind of content that fans clamored for just a few years earlier.

So how did it come to this? Let’s take a look at how one of the most-vaunted new game developers of the decade so quickly went bust, and whether other companies could learn something from the demise of Telltale Games.

The Rise of Telltale Gaming
Telltale gaming was first founded back in 2004 as a collaboration between former developers from Lucas Arts, the studio best known for their globally-successful Star Wars and Indiana Jones video games.

Telltale didn’t see its first signs of success until around 2010 when they cracked the business model that made them millions; creating games using intellectual properties with dedicated fan bases. It was this model which produced their most successful releases, including the Borderlands games series, Back to the Future and Guardians of the Galaxy. Each game was based on a simple yet effective premise of episodic adventures in which die-hard fans could play as their favorite characters.

As well as the critically-acclaimed Walking Dead series, Telltale’s other smash-hit was the widely praised Game of Thrones adventure series, released across 6 playable mini-episodes. Capitalizing on the global success of Game of Thrones proved a business masterstroke, allowing the company to rake in millions from the insatiable appetite for new content that fans of the show have.

It’s for this reason that GoT proved such a cash cow for many other businesses. There have been a number of highly lucrative different spin-offs based on the show, including a mobile game produced by Disruptor Beam, and Xbox game released by Atlus, and even a Game of Thrones slot game hosted by online casino Betway, all of which follow the Starks, Lannisters and Targaryens. Add into the mix a billion-dollar merchandising platform, a series of highly successful comic books published by Dynamite, and of course the sold-out Game of Thrones Live Concert Experience, and it’s clear why Telltale’s model was such a phenomenal success. When demand is endless, make sure you’re the guy supplying.

What Went Wrong?
So how did things go downhill so quickly? Despite this seemingly fool-proof business model, Telltale soon began to attract accusations of refusing to innovate and improve their quite simple, dated game technology, with gaming critic magazine Polygon saying they “immediately encased themselves in amber” following the success of The Walking Dead.

Sticking to what worked at first clearly wasn’t enough to guarantee future success, as frustrated and bored fans began to turn away from Telltale. As revenues began to dwindle and investors started looking elsewhere, Telltale attempted to shore up the company by announcing a restructure and mass layoffs of staff. This however only made matters worse, as they were quickly accused of violating labor laws and became embroiled in a series of lawsuits with both the state of California and disgruntled former workers. Such bad press quickly turned Telltale into something of a toxic brand, meaning that even the most loyal investors began to jump ship. The rest, as they say, is history.

So what can we learn from the sudden and unexpected demise of Telltale Games? For one thing, the video game industry requires constant innovation and improvement to succeed, and you can’t rely on the patience of fans forever. Another nugget of wisdom to take from this is, if things start going downhill, don’t suddenly fire hundreds of people overnight with no warning.

[Written by External Partner]