The studio behind The Elder Scrolls Online has to endure extensive layoffs for the second time in a short period. MeinMMO editor Karsten Scholz fears the worst for one of the last major MMORPGs from the West.
What happened? Xbox is undergoing massive layoffs. Thousands of employees are losing their jobs, including many creatives from ZeniMax Online Studios. The team behind Elder Scrolls Online is said to be so affected that the current roadmap for upcoming updates needs to be adjusted.
However, I strongly doubt that all ESO fans will ultimately have to live with merely a slightly adjusted roadmap and somewhat longer waiting times for upcoming updates.
The Elder Scrolls Online is one of the largest MMORPGs on the market. The way the game tells its stories through fully voiced dialogues involves a tremendous amount of work behind each content update.
In the past, it was hardly possible for ZeniMax, in its full creative strength, to meet the planned release schedules. Author and game designer Andrew Young addresses this in one of his recent posts on X:
I’m just so angry today. People will never know how much blood, sweat, and tears went into the development of ESO or that we essentially funded other failing projects while we were never given enough resources to truly maintain our release rhythm. The team deserved something much better.
How is a significantly reduced team supposed to implement all the planned new features for this year, such as fresh story content, reworking all classes and weapons, solo dungeons, or the Skyrim season with gigantic world events in the foreseeable future? My fear: not at all.
On the contrary, the freshly established seasonal model could now backfire, requiring fresh incentives every few months after a reset.
You must not forget: The Zenimax Online Studios had to endure extensive layoffs just a year ago. At that time, internal sources stated that this caused significant long-term damage to the team. After that, the remaining forces had just under a year to piece things back together, only to be hit by the next wave of layoffs now.
Such things can destroy studios. It would be particularly dramatic for the ZeniMax Online Studios.
The Elder Scrolls Online is certainly one of the MMORPGs that he has invested the most time in. He was there during the beta and has played almost every quest in Tamriel with his Nightblade since then.
The Roots of ZeniMax
I must have first encountered the ZeniMax Online Studios sometime in early 2014. At that time, it was about getting beta access to The Elder Scrolls Online, which was set to go live in its final version in early April.
The plan was: play through the Molag Bal campaign in the beta to be able to write a pre-test at the launch of the MMORPG. The long-term test was then to follow on the live server.
At that time, the ZeniMax Online Studios had already existed for seven years, but they had not yet published a game. Nevertheless, the team had a lot of experience, especially at the top. Studio head Matt Firor came from the MMO experts at Mythic Entertainment, where he worked on online games such as Aliens Online, Godzilla Online, and of course Dark Age of Camelot.
The Elder Scrolls Online started quite bumpy nonetheless, with all sorts of bugs and a little motivating endgame. A rather typical MMO launch, one might say. Unlike many competitors, however, the developers at ZeniMax rolled up their sleeves and specifically tackled the biggest problems of the game.
The result was comprehensive changes for the entire character progression and the endgame, as well as a clear content roadmap that relied on DLCs, chapter expansions, and free updates for years. Through these measures, ESO transformed into one of the largest and most popular MMORPGs in the world, especially on consoles.
The last progress report from the Summer Game Fest 2025 stated 26 million players.
I myself was able to experience the development of the game from the beta to today with my Khajiit Nightblade at the forefront, and repeatedly talked about the MMORPG with especially Matt Firor and Rich Lambert (long-time creative or game director of ESO, now the studio game director of ZeniMax since 2025). Additionally, about a dozen dungeon runs with the developers.
What I have consistently noticed in all conversations and at every appointment: Enthusiasts work at ZeniMax who love the MMO genre and enjoy playing their own game privately. Accordingly, it was particularly bitter that the early demise of the second MMO that was supposed to be developed at ZeniMax … there could have been a really good new MMORPG created with the lessons learned from ESO.
The Beginning of the End
Apart from the supporting tasks for Doom (2016) and Fallout 76, ZeniMax, 19 years after the studio’s founding, has no other game listed in their portfolio beside Elder Scrolls Online. For a studio with over 300 employees (as of 2025, before the first wave of layoffs), this can become a problem over time as the revenues from the previous cash cow gradually dwindle.
As is well known, ZeniMax worked for over seven years on a new MMO that was supposed to wear the crown of the cash cow. Project Blackbird was supposed to go in the direction of online loot shooters like Destiny, with an exciting sci-fi dystopian setting reminiscent of Blade Runner.
According to Matt Firor, it was a game he had been waiting to develop for his entire career. There’s even an anecdote going around that Phil Spencer, the former Xbox chief, had to be literally handed the controller back while testing it in order to continue the meeting.
When the project was unexpectedly canceled last year, studio head Matt Firor took the consequences: he resigned. At that time, the Microsoft executives were already laying the groundwork for what is happening now.
On X, there were supposed leaks showing the MMO Project Blackbird:
What Will Happen to ZeniMax?
Currently, I can hardly imagine that The Elder Scrolls Online and ZeniMax can survive all of Microsoft’s blows in the long term. At best, there will be ESO for a while longer, but then with a radically shortened content roadmap and a small but loyal community.
In the worst case, the new layoffs and the resulting impacts on future content could create a spiral effect that ultimately leads to the end of the MMORPG and the closure of the studio.
What I consider impossible, however, is that we will experience an upward trend with The Elder Scrolls Online in the coming years and that at ZeniMax a new, ambitious MMORPG will emerge at some point.
Microsoft has, in any case, one of the largest and most successful MMO studios from the West on its conscience. And it breaks my heart. Because I associate so many great memories with ESO. Because I greatly value many of the (partly former) responsible individuals at ZeniMax. And because there are hardly any studios left in the West willing to take on the risky and expensive genre of MMORPGs. In the end, everyone loses.
What do you think: Do you believe that the end of The Elder Scrolls Online and ZeniMax is sealed? Do you still have hopes? Feel free to share in the comments! How bad the situation has been for Western MMORPGs over the past decade is discussed here: Only 1 major MMORPG from the West in 12 years shows the collective failure of an entire industry
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