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How did Zenimax sustain all these studios just fine but now suddenly it's too much when they haven't even added any new studios?

Tango was in the process of pitching a sequel, said the people, who asked not to be identified discussing nonpublic information.

Before its closure, Arkane had been looking to return to its roots by pitching a new single-player "immersive sim" game, such as a new entry in the Dishonored series, according to the people familiar.

Jill Braff, head of ZeniMax studios, said in the town hall that she hoped the reorganization would allow the division, which also develops Fallout and Doom, to put more focus on fewer projects. "It's hard to support nine studios all across the world with a lean central team with an ever-growing plate of things to do," she said, according to audio of the meeting reviewed by Bloomberg.

"I think we were about to topple over," she added.

Both Tango and Arkane released games last year and were looking to hire additional staff as they pitched new projects, which Booty and Braff suggested was the main factor behind their closures.