Report: Elden Ring, Dragon Ball publisher Bandai Namco pressures 200 employees to quit with "expulsion rooms" after cancelling a Nintendo game, other projects

What you need to know

• Bandai Namco Entertainment is one of the biggest game publishers in the world, and is behind hugely popular titles like Elden Ring and Dragon Ball: Sparking! ZERO.
• According to a new report, the company has moved 200 of its staff into oidashi beya, or "expulsion rooms," in an effort to pressure them to resign from their positions.
• In these rooms, workers are given no assignments, but understand their lack of productivity can be used as grounds to cut severance pay. Effectively, they're designed to get employees to leave voluntarily without breaching Japan's strict labor laws.
• In a statement, Bandai Namco has denied that it's making use of oidashi beya, commenting that "some employees may need to wait a certain amount of time before they are assigned their next project."
• The report comes after Bandai Namco cancelled multiple games, and notes that one of them was an unknown project in development with Nintendo. It also comes amidst widespread turmoil in the gaming industry, with over 23,000 cuts recorded since 2023.

According to a new report, Bandai Namco Entertainment — the publisher of wildly successful games like FromSoftware's Elden Ring and other titles like Tekken 8 and Gundam Revolution — is working to cut 200 members from its staff of 1,300 following multiple recent game cancellations.

Speaking with Bloomberg, "people familiar with the matter" say that the Tokyo-based company has moved 200 workers into oidashi beya, or "expulsion rooms." In these rooms, employees are given no work (many spend the time looking for new employment) but understand that their lack of productivity gives their superiors grounds to cut severance pay when they depart, pressuring them to leave quickly and voluntarily. Reportedly, around 100 workers have resigned already, with more departures expected in the near future.

Oidashi beya are occasionally used by Japanese companies to cull their workforce while still remaining compliant with the country's austere labor laws and regulations. However, in a statement given to Bloomberg, Bandai Namco has denied that the firm is utilizing these rooms and says some of its employees are simply waiting to be reassigned.

"Our decisions to discontinue games are based on comprehensive assessments of the situation. Some employees may need to wait a certain amount of time before they are assigned their next project, but we do move forward with assignments as new projects emerge," said a spokesperson for the publisher. "There is no organization like an ‘oidashi beya’ at Bandai Namco Studios designed to pressure people to leave voluntarily."

Bandai Namco is one of the biggest publishers in the industry, but like other game companies, it's been beleaguered by financial struggles — even despite big hits like Elden Ring and the explosively popular Dragon Ball: Sparking! ZERO that released last week. These declines are generally attributed to players having less time for gaming in the post-pandemic era, and have led to waves of significant layoffs in 2023 and 2024.

In Bandai Namco's case, the downturn has brought about major write-downs, along with multiple other projects getting shut down, cancelled, or put on ice this summer. Earlier this year, the company closed down the Tales of the Rays mobile game and announced its intent to shutter the popular free-to-play action RPG Blue Protocol in January. Bloomberg also reports that it's either halted development on or outright axed several additional games, including ones based on the Naruto and One Piece animes and one mystery project that was being worked on with Nintendo.

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Analysis: Devastating declines continue

Regardless of whether or not Bandai Namco is actually making use of "expulsion rooms" like the report suggests, widespread cuts and closures show that the overall state of the gaming industry right now is incredibly tumultuous. Even the largest publishers in the world have been racked by post-pandemic struggles; Xbox maker Microsoft, for example, laid off 1,900 workers in January and then slashed an additional 650 from its workforce just last month.

Analyses like those from DDM Games Investment Review suggest a recovery is in sight, but others have warned that the bleeding could continue well into 2025. I'm hopeful that things will get better sooner rather than later, but ultimately, the future is uncertain.

Above all else, though, my thoughts are with affected employees and their families — both at Bandai Namco, if they're being pressured to resign, and elsewhere. I hope you're able to find new positions quickly and smoothly.