38 Studios has been having money issues since they opted to take out a $75 million load from Rhode Island to set up their studio there. The State of Rhode Island was hoping that by having the studio there it would bring in jobs and other tech companies. Unfortunately 38 Studios was not able to have the return on their investment that they expected. Although the game Kingdoms of Amalur did well, it was not enough to float the company. According to most reports 38 Studios has already worked through most of the $75 million and cannot pay it back.

There have also been reports that they had to make the hard choice between paying their payment to Rhode Island ($1.1 Million) or laying people off. Apparently they ended up having to keep their creditors happy and have laid off the entire staff. This is not a good sign for a company that has one title in the market and another in the oven.

This is really a sad day as the team at 38 Studios is very capable. We tested out Kingdoms of Amalur and found it to be an excellent (and addictive) game. It does fallow a very familiar story line, but the graphics and interaction are very well done (and cool). We hope that 38 Studios can find a way to keep the doors open and finish their second project Copernicus as the market does need new ideas and innovation to keep things interesting instead of the same old titles with another number tacked onto the end.

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