Naughty Dog, developer of some of the most acclaimed games in the industry from Uncharted to The Last of Us, had a choice to make. They could either keep slogging away at The Last of Us Factions, an online multiplayer game years in the making. Or they could go back to making their trademark signature games.
Last night, they announced what they chose.
Naughty Dog has canceled development on The Last of Us Factions, which they’re calling The Last of Us Online. They posted a lengthy statement that ended with a particularly poignant passage that sums up larger issues with Sony and the wider industry right now:
“In ramping up to full production, the massive scope of our ambition became clear. To release and support The Last of Us Online we’d have to put all our studio resources behind supporting post launch content for years to come, severely impacting development on future single-player games. So, we had two paths in front of us: become a solely live service games studio or continue to focus on single-player narrative games that have defined Naughty Dog’s heritage.”
Naughty Dog is saying outright that they’re rejecting becoming a live service developer to support a game like this, instead focusing on the single player games they’re known for, where their last project, The Last of Us Part II, was one of the most-awarded games of all time, and the series spawned a show nominated for 24 Emmys.
All of this reflects horribly on Sony, who previously announced that 60% of its budget would be devoted to making 12 live service games over the next few years. Now, that number has been cut to six, with the other six delayed indefinitely. And perhaps that’s now down to five.
Sony’s live service push has been a massive miscalculation so far, and there is perhaps no better example than what’s happened with The Last of Us Factions. Yes, fans certainly would have been open to Factions 2, an evolution of the first multiplayer Factions sub-game from the first Last of Us. What no one was asking for, except Sony and perhaps top Naughty Dog execs trying to please Sony, was for The Last of Us to become some sort of sprawling, live games-as-service production with seasons and battle passes and microtransactions stretching out into the indefinite future.
Sony famously, perhaps now infamously, purchased Bungie as a major component of its live service arm for $3.6 billion in 2022. Part of their mandate was to consult with Sony’s existing studios on live service projects, and reporting said that when they looked over Factions, they deemed that it wasn’t engaging enough. And live games, if nothing else, are all about chasing engagement. After that, the team was scaled down, infrequent updates turned non-existent, and now we have this finale, where the game is canceled.
But this is a project years in the making, well before Bungie came along. It started development during production of The Last of Us Part II itself, production which began in 2014, and it’s tough to think what could have just been a fun, attached multiplayer mode to TLOU2 turned into this unwieldy live service disaster.
In theory, you can understand Sony’s newfound desire to chase after live service cash. They make excellent single player games. But those single player games have enormous budgets and are sold once, for $70. They may produce on $20-30 DLC or expansion, maybe. But nothing like the money that live service games can print. So, Sony said “We want some of that.”
What they seemed to ignore is the sheer amount of failure in the space, who succeeds and who doesn’t, and how much it takes to build and maintain a game like this. The highest profile failures did exactly what Naughty Dog was on the road to do here. Games like Anthem, Avengers and Battleborn, all chasing live service ambitions, took the makers of single player games like Mass Effect, Tomb Raider and Borderlands way outside their comfort zones. Those games failed and they went back to those exact same series. Now, Naughty Dog is doing the exact same thing, except skipping the step of actually releasing the game and trying to make it work for a year or two. It’s a good decision, but it was a bad decision to go down this path in the first place, resulting in so much lost time and money and effort. And that is entirely on Sony.
The idea that Bungie could come in, wave a wand, and teach a bunch of single player studios how to make live games was never realistic. Bungie itself is now struggling with revenue and player falloff in its only game, Destiny 2, leading to mass layoffs and cratered developer morale. And Destiny is one of the biggest live services successes of the last decade, reiterating just how hard this space can be.
Sony did not understand what they were getting into here, and they should have. I believe that Naughty Dog wanted to make a fun multiplayer game. And I believe they could have made that game, as the original Factions already demonstrated. But there is a difference between an attached multiplayer mode and taking a 400 person studio known for the most acclaimed single player games in the industry, and turning them into a live service seasonal battle pass producer.
I recognize that Sony has challenges in the industry as costs rise and other live games print money. But this plan was a terrible one, and I suspect this will not be the only high profile live service failure we see from them, if they continue down this path. The whole idea is falling apart before it’s even gotten started.
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