Top 10 Video Game Companies Ruined by One Game

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Top 10 Video Game Companies Ruined by One Game

VOICE OVER: Riccardo Tucci WRITTEN BY: Nathan Sharp
These are the most tragic cases of a single video game being the downfall of an entire company. Welcome to Watchmojo, and today we're counting down the top 10 companies that went bankrupt from one video game release. Did we forget any games for this list? Let us know in the comments!
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Top 10 Video Game Companies Ruined by One Game

And with that, the company came to a swift and messy end. Welcome to WatchMojo, and today we’re counting down our picks for the top ten video game companies ruined by one game.

For this list, we’ll be looking at video game development companies who faced either financial ruin or a terrible reputation following an underperforming or critically panned release.

#10: Flagship Studios
“Hellgate: London” (2007)


“Hellgate: London” was an RPG hack and slash game from Flagship Studios, a small company founded by former Blizzard North executives. They had abandoned ship following a dispute with Blizzard’s parent company, Vivendi. “Hellgate” was their first creation, and it was released to incredible hype on October 31, 2007. However, it was considered a massive disappointment and received middling reviews, with many criticizing the game’s lackluster combat mechanics and technological shortcomings. Following the game’s release, Flagship received funding from Comerica Bank to support post-release content, and the game itself was used as collateral. Unfortunately, Flagship filed for bankruptcy in the summer of 2008 and subsequently lost the IP rights to “Hellgate.” And just like that, Flagship Studios had come and gone.

#9: Realtime Worlds
“APB: All Points Bulletin” (2010)


Following “Crackdown” in 2007, Realtime Worlds released “APB: All Points Bulletin,” an open world multiplayer version of Cops and Robbers. In this game, users play as either an Enforcer or a Criminal and carry out faction-specific objectives. Quite astoundingly, it eventually became one of the most expensive video games ever made, with costs exceeding $100 million. The game did not match the scope and promise of its budget, and it received relatively poor reviews from critics. It also wasn’t very popular. Just six weeks after the game’s release, Realtime entered administration. The game’s servers were eventually shut down, Realtime was liquidated, and the rights to “APB” were purchased by K2 Network for just £1.5 million.

#8: Factor 5
“Lair” (2007)


Factor 5 was a pretty big company in the 90s and 2000s, developing games like the “Turrican” series and “Star Wars: Rogue Squadron.” Following two “Rogue Squadron” sequels for the GameCube, Factor 5 went to work on “Lair,” a PS3 exclusive that took advantage of the new sixaxis function. Unfortunately, that’s exactly what people hated about the game. While most players praised the art direction and graphics, the game was fiercely condemned for its poor controls. The condescending “Lair Reviewer’s Guide” that Sony sent to critics certainly didn’t help. Factor 5’s reputation was ruined, and they later closed their doors after an unrelated issue with publisher Brash Entertainment.

#7: Team Bondi
“L.A. Noire” (2011)


The interrogation-based “L.A. Noire” certainly had its issues, but it was mostly commended for being unique and different. It would also prove to be Team Bondi’s only game. The company was founded in 2003, and “L.A. Noire” was announced two years later. Following a very lengthy development process and a significant publisher swap, “L.A. Noire” was finally released in May of 2011 to positive critical reception and strong sales. However, allegations of poor working conditions at Bondi quickly surfaced, and the controversy tarnished the relationship between Rockstar and Bondi. Left without a publisher, and with no other company willing to work with them, Bondi was placed into administration on August 31, 2011. They were liquidated the following October.

#6: Free Radical Design
“Haze” (2008)


“Haze” was widely touted as a “Halo killer.” It turned out to be a studio killer instead. “Haze” came from Free Radical Design, the team behind the amazing “TimeSplitters” series. It was their third new IP, and their first game since “TimeSplitters: Future Perfect” in 2005. The game faced a rather expensive development, as Free Radical created their own graphics engine and the game itself was radically redesigned under Ubisoft to compete with more mainstream shooters. To further complicate matters, Ubisoft decided to cancel the Xbox 360 and PC releases and make “Haze” a PS3 exclusive. The game was a critical and commercial disaster, and Free Radical went bankrupt just seven months after its release.

#5: Silicon Knights
“Too Human” (2008)


“Too Human” was just a monumental failure on all fronts. It was originally announced way back in 1999 and was scheduled to release on the original PlayStation. However, changing partnership deals and an emphasis on other games resulted in lengthy delays, and the game wasn’t released until 2008. It eventually racked up a budget between $60-100 million and received mediocre reviews. It was also the subject of a heated lawsuit, as Epic Games sued Silicon Knights over their misappropriated use of their Unreal Engine 3. The lawsuit was finally settled in 2012, and Silicon Knights was forced to pay $4.45 million and recall and destroy all the unsold copies of “Too Human.” Unsurprisingly, they filed for bankruptcy shortly after.

#4: Core Design
“Tomb Raider: The Angel of Darkness” (2003)


This was the first “Tomb Raider” game made for the PlayStation 2, and to take advantage of the new technology, Core Design decided to significantly overhaul the character and setting. However, they quickly collapsed under the weight of their ambition. Projects and ideas were continually scrapped, the company lacked leadership, and the team was horribly fragmented and aimless. The quickly approaching deadline also caused them to cut various significant elements from the finished product. The resulting game was broken and messy, and it received terrible reviews. Core Design’s reputation was permanently tarnished, and parent company Eidos gave the “Tomb Raider” IP to Crystal Dynamics. Key employees quickly left, and Core Design was eventually bought by Rebellion Developments before it’s closure in 2010.

#3: BioWare Montreal
“Mass Effect: Andromeda” (2017)


BioWare was once THE name in story-driven RPGs. Games like “Knights of the Old Republic,” “Dragon Age,” and “Mass Effect” garnered them incredible praise and popularity, and it seemed like they could do no wrong. And then “Mass Effect: Andromeda” happened. Most people were willing to forgive BioWare over bungling the “Mass Effect” ending, but “Andromeda” was an unforgivable disaster. Developed by BioWare’s Montreal studio, it was mocked and memed before it was even released thanks to the unintentionally hilarious facial animations, and when it was released the game received average reviews from critics and fans alike. BioWare Montreal would later be merged with EA’s Motive Studios just a few months after the game’s release, a move that many believe to be the direct result of “Andromeda’s” failure.

#2: Ion Storm
“Daikatana” (2000)


Throughout the 90s, John Romero was one of the biggest names in gaming. He was known for designing “Wolfenstein,” “Doom,” and “Quake,” three of the most influential titles in FPS history. So when it was announced that he and fellow designer Tom Hall were leaving id and starting their own company, expectations were through the roof. However, work on “Daikatana” was fraught with difficulty and the game was released to terrible reviews. But worse, it was a bonafide commercial disaster. Reports forecasted sales of 2.5 million, but it pushed an abysmal 40,000. The Dallas branch was closed by parent company Eidos just one year later, and the Austin branch soon followed. And with that, the most promising gaming company in the world crumbled to dust.

Before we unveil our top pick, here are a few dishonorable mentions.

Pandemic Studios
“The Lord of the Rings: Conquest” (2009)

Raven Software
“Singularity” (2010)

Hangar 13
“Mafia III” (2016)

Danger Close Games
“Medal of Honor: Warfighter” (2012)

#1: Sega
“Shenmue” (1999)


“Shenmue” was a technological marvel for its time, and Sega proved ridiculously ambitious with its creation. Unfortunately, these marvels also came with an inflated budget, and “Shenmue” was priced at a ridiculous $70 million, making it the most expensive video game ever developed at the time. It had no hope of recuperating its budget, and while the game sold a respectable 1.2 million copies, that was not enough to turn a profit. The game was a massive commercial flop and lost Sega a ton of money. Its failure was a major contributing factor to Sega’s exit from the console market, and the Dreamcast proved to be their final contribution. “Shenmue” not only killed the Dreamcast, but it killed Sega’s participation in the console race.

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We all know Sega got back on it's feet, right???
Sorry, Bethesda