Jason Schreier Discusses Microsoft’s Reported $500 Million Spending on Gears of War: E-Day

Gears of War: E-Day developers face the threat of layoffs over a reported $500 million budget, but journalist Jason Schreier says the figure does not reveal how much the game itself cost to make.

The reported budget drew widespread attention online and shocked the gaming industry. It also prompted discussion that employees at developer The Coalition feared layoffs.

In a new video, Schreier confirmed that the $500 million figure appears in documents. But he said that does not mean the entire sum went toward the game’s campaign and engine.

According to Schreier, some of the money may have gone toward technical support for other Microsoft teams, work on Unreal Engine, and the creation of specialized tools.

Schreier also pointed to the high cost of employing staff in North America. A single employee costs a company $15,000 to $30,000 per month when salary, insurance, equipment, and office rent are included. The longer development takes, the higher the costs.

Xbox’s financial policies, annual budget approvals, and Game Pass further complicate the picture, Schreier said. Comparing costs with sales of game copies is therefore meaningless, as that comparison cannot establish the project’s actual profit.

Source: iXBT.games