Insights into Bethesda’s growing pains

This week’s news of layoffs at Bungie demonstrates once again how precarious life is working for a games company.

Even companies that enjoy sustained success – give or take the occasional hiccup – are susceptible to layoffs, especially if they’re part of a much larger organization. Earlier this year, the traditionally stable Bethesda laid off some of its staff during one of Microsoft’s regular purges of its global payroll.

At the time, the company was putting the finishing touches to Starfield, which was finally released in September, attracting an impressive six million players upon launch, which rose to ten million within days. The game has been a major draw for parent company Microsoft’s big bet on Xbox Live.

It makes me wonder why exactly Bethesda needed to enact staff cuts. The company has not – so far as I can tell – offered up any explanation. It’s an example of how game industry employees are never safe, even when they’re working for companies that are in solid financial health, with the prospect of a record-breaking global smash hit on the horizon.

Deep affection

With this in mind I was drawn towards an interview with former Bethesda senior developer Bruce Nesmith, who spoke at length with Ben Hanson on YouTube gaming interview show MinnMax.

Nesmith retired from the company two years ago. While obviously a man who has deep affection for his former employer – and the games the company made during his many years there – he offered some fascinating insights into how an organization copes with the challenges of growth, success, expansion and integration into a larger entity, as well as with the occasional creative failure.

During Nesmith’s time at Bethesda, he was part of the amazing success of Oblivion and Skyrim, but also the multiplayer mess of Fallout 76, which underperformed financially, and was received without much enthusiasm by critics.

Companies like Bethesda are generally precious about their internal machinations, preferring to restrict public announcements to the kind of trite marketing-speak we’ve heard so often down the years.

One of the clear challenges, he said, was a creative structure that focused a lot of decision-making in the hands of one person – in this case, highly respected executive producer Todd Howard.

Do our thing

Howard’s success bought him trust from workers, and from the money people at the very top. “Todd became the single source communicator to management,” said Nesmith. “The string of successes that we had, allowed him to go to management and say … ‘hey, we’ve been making great money for you guys. We’re making great games. Everything’s going along wonderfully. Let us do our thing’.

“You couldn’t ask for a better working environment…” he added, “They signed the checks. [They] put that trust in Todd, who then turned around and put that trust in us. That’s a wonderful thing.”

But with success came growth, under the aegis of owner Zenimax, and more recently, Microsoft. Nesmith told how Howard repeatedly blocked managerial attempts to focus on multiplayer games, which has never been one of Bethesda’s strengths. When Howard finally agreed to the pressure, the company badly damaged its hitherto spotless reputation with the launch of the messy Fallout 76. It took enormous effort and resources to rescue the game, and to bring it back to wide critical acceptance.

But a bigger problem was beginning to emerge at Bethesda,. As Nesmith explains, there has been “a little bit of turmoil” at the company recently, with several senior departures.

“There were a lot of changes going on. And the structure of the company also was such that – half because of the pandemic and half just because of the necessary changes – you didn’t get to interact with Todd as much anymore.

“I’ve been blessed with the ability to pretty much walk into his office anytime I needed to and be able to have conversations with him. But when [he’s] running six different studios, and a dozen projects … lines of communication became a lot more rigid, of necessity.”

Decisions run

According to Nesmith, Howard was aware of the difficult situation and, at an intellectual level, wanted to fix it. But such deeply ingrained practices are easier to resolve in theory, than in reality.

“All decisions run through Todd,” said Nesmith. ” Sure. He would hate me for saying that because he doesn’t believe it’s true, but unfortunately it is true. If you want to have anything different other than the Bethesda usual on some particular aspect … [you] somehow got to get in front of him.

“The part that is on me is that I wanted to be the person putting that in front of him. I didn’t want my group leader to be the one putting it in front of him, getting the feedback and then coming back down to me. I wanted to be able to maintain [personal contact]. There were 30 other people who wanted that same thing. And that’s just not possible. Somebody had to step out of the line.”

Minnmax presenter Hanson asked Nesmith if he could have waved a magic wand and fixed the situation. And although he’s clearly a problem-solver, who’s spent time thinking about his long career at Bethesda, he doesn’t have a simple answer.

“I will give [Howard] full credit. He has tried really hard to not be the ‘last say’ guy. It hasn’t worked out that way. But that’s not something that he wants intellectually. I think it ends up being that way because he’s somebody who has opinions whose opinions are highly valuable.

“And so it ends up being that way whether he likes it or not. But I think when you’ve got somebody who is at the creative center and heart of a studio, there’s going to be a limit to the size you can grow to. I don’t know this for a fact, but I think Bethesda probably outgrew that.

“With the ability to have him at the creative center he would have had to give up more creative control than he was willing to for other projects in order to allow the company to be larger and still maintain that creative center on the things he cared the most about.”

You can watch the full interview here.