Namco Tales Studio is the developer behind Tales of Phantasia, Tales of Eternia, Tales of Destiny and Tales of Vesperia. The studio has seen better days.

A recent financial report has revealed that debt for the studio has piled up so that it has surpassed the studio's total assets, making the developer insolvent. The Tails Studio has accumulated a debt of 21 million dollars and has posted an annual loss of one million dollars.

"Meetings and conferences, sleepiness and struggle, it was a day of live or die," Tales producer Makoto Yoshizumi obliquely tweeted on June 18. He goes on to say that next week (this week) will be extremely busy and that from henceforth, "it's going to be gloomy".

Things have not been good recently for the Tales series, I honestly don't think Namco will shutter the studio. The Tales role-playing games still have a strong brand name in Japan, and it was a mistake to think the studio could compete with both Dragon Quest and Final Fantasy. A reorganization and refocusing seems more likely.

The studio was opened in 1986 and is a subsidiary of Namco Bandai. The Tales series has been spun off to anime with Tales of Vesperia: First Strike in late 2009. The most recent Tales game, Tales of Phantasia: Narikiri Dungeon X, will be released on the PSP this August in Japan.

http://kotaku.com/5568531/end-of-story-for-tails-studio 

I've only played Tales of Symphonia, and I loved that so I'll be sad to see them go

Well, they should do a genre that sells nowadays...

I still can't believe how many JRPGs are still being made. They're probably more expensive than a lot of other games to make and only sell moderately good (aka mediocre sales) in japan. They all flop in the west with a few (more like one) exceptions.

Just look at that Sega game, end of eternity... how polished is that thing? Must have costed a lot... how much it sold in the west... nil, nada, nothing.

Studios must change to survive... and the tales team is just insisting on milking a game that is proven to not sell.

I hope they can do something about it. Getting more games out of Japan would be a good start.

Namco's fault. She did not release the DS games out of Japan, the same for Wii Tales of the Graces and never made a strong marketing for the franchise. The last time was with Tales of Symphonia the only one to beat million copies sold.

Obviously they will declare bankruptcy and integrate people from the studio to Namco for not having to pay the debts.

I actually wouldn't mind seeing them (and the Tales IP) sold off to Square Enix... though I wonder how it might effect their relationship with tri-Ace?  Is there still bad blood there?  Enix was originally bidding with Namco for "Tale Phantasia" back in the early 1990s iirc.

If Namco just closes Tales Studio down, I imagine they'll just take key staff internal and continue making (fewer) Tales games, which also might not be a bad thing.

Here's  a tip guys : There's a market for your games overseas. Much bigger than the local Japanese at least.

it's their own fault, they have like 3 tales games for the DS they didnt release outside of Japan and the PS3 Tales of Vesperia also only released in japan.

To be honest, I'd rather not see Atlus assume the risk or expense.  I like Atlus too much (both for their own games and Atlus USA's choice pickups).

The only parties I can really see being both able and interested in buying Tales Studio would be Square Enix, Nintendo or Ubisoft. :/

Eh, Megaten games have far, far lower production values (and thus likely far, far lower budgets) than mainline Tales though.  Ditto for other Atlus staples Etrian Odyssey, Growlanser, Trauma or Sting's games... even something like Tales of Hearts seems like it was probably a more costly venture than all Atlus R&D1's DS games combined so far.  That's the problem, Tales games these days have AAA budgets but B grade sales in Japan, and the franchise has been mismanaged into oblivion elsewhere.

Honestly I think the best thing going forward would be to reorganize the studio into one core team, and maybe within Namco even.  Let them work on one high profile Tales at a time, and get it out every 2 years or so.   A full 3D Tales of Phantasia remake might be a good start (as a sort of "series reset").  Maybe for 3DS too, hit the ground running for next gen and really consolidate the Tales base on one platform for the future.