South of Midnight Studio Seeks New Projects After Leaving Xbox
▼ Summary
– Compulsion Games regained independence from Microsoft during Xbox layoffs and is now seeking new work opportunities as an independent studio.
– The studio announced it is open to collaborations to support development of memorable projects, suggesting it may not be focused on its own game.
– Compulsion Games retains brand rights to its games South of Midnight, We Happy Few, and Contrast after the split from Xbox.
– The studio’s post highlights its award-winning team and experience in creating original IP, inviting partners to leverage their talent.
– Fellow Xbox studio Double Fine also regained independence, while Arkane, Ninja Theory, and Undead Labs are undergoing similar transitions amid ongoing Xbox cuts.
Just days after Compulsion Games reclaimed its independence from Microsoft amid sweeping Xbox layoffs, the studio behind South of Midnight and We Happy Few is already seeking fresh opportunities. Facing the realities of operating on its own, the developer has announced it is open to new “opportunities to collaborate” and aims to “support the development of memorable projects” created elsewhere. This suggests the studio may not be entirely focused on crafting its own game at the moment.
On LinkedIn, Compulsion Games stated: “With Compulsion Games returning to its roots as an independent developer, we are expanding opportunities to collaborate with studios across the games and entertainment industry. We invite partners to leverage the talent and creativity of the award-winning team behind South of Midnight, a game that was honoured with a BAFTA Award, seven Canadian Game Awards, and recognised on multiple ‘Best Games of 2025’ lists.” The studio emphasized its deep experience in building acclaimed original IP, bringing artistry, technical expertise, and a collaborative spirit to every project.
As part of its separation from Xbox, Compulsion Games retained the rights to its existing franchises: South of Midnight, We Happy Few, and Contrast. What the roughly 112-person team has been working on since the 2025 release of South of Midnight remains unclear. That game received no expansions or add-ons, leaving many to wonder if the studio was quietly supporting other Xbox projects.
Pitching for work is the natural state of an independent studio, of course. Compulsion may also be developing something of its own in parallel, something to present to publishers for funding. But the larger question is this: in a market fixated on cost-cutting and cautious spending, which publisher will take a gamble on it?
The other Xbox studio to regain its independence last week was the beloved Double Fine, creator of Psychonauts. That team, also between big projects, released the charming lighthouse and bird adventure Keeper in October, followed by a smaller pottery project called Kiln this spring. Like Compulsion, Double Fine retains ownership of its franchises, but its next move is a mystery.
Meanwhile, acclaimed Dishonored and Deathloop studio Arkane is negotiating its own split from Xbox. Hellblade developer Ninja Theory and State of Decay studio Undead Labs are now under undisclosed new ownership.
Microsoft’s Xbox cuts have resulted in 1,600 immediate layoffs, with another 1,600 expected between now and next summer. The reductions have touched every part of the Xbox division, even sacred franchises like The Elder Scrolls.
(Source: Eurogamer.net)
