Fortnite layoffs are another consequence of gaming giving into big tech’s fads

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It’s never a good look when the company running what is still, inarguably, one of the most popular and successful games in the world lays off 1,000 people, as happened with Fortnite maker Epic Games this week. It makes you ask questions like: Is the game industry doomed? Or, alternatively: What the hell was Epic spending all its money (an estimated $6 billion of annual revenue) on, anyway?

I asked some people who should know what on earth was going on, and got a range of answers. Fortnite still tops the engagement charts on console, but maybe it really is well past its peak by now, and Epic keeps making unpopular moves, like raising the cost of V-Bucks. Or, perhaps, all the kids swarming the game to play Brainrot games aren’t spending anything. Or — most depressingly plausible to me — Epic, which is still a private company, is simply making its balance sheets look more attractive ahead of a much-rumored stock market listing.

Here’s another theory. Over the past four or five years, Epic has invested a tremendous amount into turning a very popular battle royale game into a social network, a virtual hangout space in which players’ persistent avatars flit between multiple different games and attractions. In a word: a metaverse.

Remember the metaverse? That thing the tech world was obsessed with after crypto mining and NFTs, and before generative AI? The thing Mark Zuckerberg changed the name of his company for (embarrassing!) and wasted an estimated $80 billion chasing before quietly giving up this year? Yeah, that.

Fortnite’s metaverse dream hasn’t even come to full fruition yet — the much-vaunted in-game Disney universe is still in development. But Epic’s other attempts in this arena keep failing. Alongside the layoffs this week, the company ditched one of the Fortnite Festival music modes, the Rocket Racing arcade racer, and the Counter-Strike-alike Ballistic. The expensive Lego Fortnite has fizzled. The push for user-created Creative maps has done better, gifting Epic with the Steal the Brainrot phenomenon (it’s currently even bigger than Battle Royale). But there’s also a possibility that Brainrot is sucking Fortnite dry, and it certainly hasn’t magically transformed Fortnite into Roblox. These big metaverse bets aren’t paying off.

It’s far from the first time that a gaming property has been kicked around by a big tech fad — the NFT craze was a near-miss for all of us — and it won’t be the last. It’s not just games, either. This week, Disney’s deal to put its characters within OpenAI’s Sora video generator — quite similar to its Fortnite investment, as a matter of fact — died a death when OpenAI iced Sora because it wasn’t making any money. A lucky escape from what was sure to be legal, reputational, and artistic nightmare, but why did Disney chase it at all?

It’s not dissimilar from last week’s DLSS 5 debacle, in which gamers loudly rejected an AI-powered upgrade they never asked for and didn’t want. Video games is a tech industry, for sure, but it’s also — arguably more so — an entertainment industry, not to mention an art form. Yet it regularly gets infected, like a virus, by big tech’s priorities, whether they are relevant or not. This week, 1,000 Epic employees paid the price. Who’s next?