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Curt Schilling Owned 38 Studios Closing Hits RI Hard

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Since retiring from baseball, ex-Boston Red Sox pitcher Curt Schilling has been pursuing another dream, the dream of creating the next major massively multiplayer online role playing game. His company, 38 Studios (former Green Monster Games) released the game Kingdoms of Amalur: Reckoning this February to mixed reviews. Now, despite some minor success in marketing and selling the game, 38 Studios is closing its doors, laying off the entire workforce which is reported to be around 380 employees, most of them working in the Rhode Island offices.

The failure of Studio 38 appears to have less to do with the failure of Kingdoms than with the economic incentives that drew the company to set up shop inRhode Island and the cost spent developing the only game the company released. Schilling originally set up 38 Studios inMassachusetts, but, in 2010, after struggling to find investors, he turned to the Rhode Island Economic Development Corporation and then Governor Donald Carcieri, who approved a $75M loan contingent on a number of job creation goals within the state. Studio 38 was unable to meet the task of creating the required number of jobs and thus has been forced to pay penalties in addition to the loan repayment. The loan payments and penalties have effectively bankrupt the company.

It is not surprising to find out that outspoken former ace Curt Schilling is no financial genius. In the creation of the game, Schilling appears to have done an excellent job, assembling a “dream team” (as he called it) of video game and fantasy talent. The game’s narratives were created by acclaimed fantasy writer R.A. Salvatore and the game was designed by comic and action figure guru Todd McFarlane. Critics were enthusiastic about the look of the game and it’s playability. The reviews were generally positive, though it was rarely heralded as being truly innovative or revolutionary.

While the failure of 38 Studios is a disappointment for Curt Schilling and his employees, it looks like a potential disaster for the already embattled state ofRhode Island. The state issued bonds to fund the EDC loan and it had a “moral obligation” clause associated with the repayment of those bonds, stating that it would be morally obligated to the investors, but not legally binding the state to repay these bonds.Rhode Island’s state legislature will now have to vote on allocating new monies for the bond repayments since 38 Studios cannot repay the loan. Defaulting on these bonds will hurt the state’s ability to issue such bonds in the future and repaying the bonds will mean allotting $100M to repay a failed video game company’s debt.

Knowing my former home state of Rhode Island as I do, I would be shocked if some fraud or misdoing within the government did not take place here. The idea that a state would grant $75M in economic development bonds to a company with just a single video game in development is infuriating and it seems ridiculous to the point of being suspicious.

None the less, Curt Shilling’s name played a prime role here. Even if those responsible had some darker and more sinister purpose here and Shilling is just a vehicle for their dirty dealings, it is clear that both 38 Studios and some members of theRhode Islandgovernment traded heavily on Shilling’s celebrity to get approval for an incredibly misguided and ill-advised deal. Would an unknown game developer with just one game in his pipeline have secured a deal like this after failing to get adequate funding from the private sector? No, they absolutely would not. There would be intense public opposition and far greater skepticism from those in charge. The idea that a person whose primary occupation for twenty years was pitching in the majors would be at a significant advantage in securing government funding is appalling.

That this has happen is a symptom of a problem withAmerica’s love affair with sports, sports heroes and celebrities in general. We need to recognize that professional athletes’ abilities are typically going to be limited to the field of play. Whatever virtues someone like Curt Shilling may have displayed as player, they don’t make him uniquely primed for success anywhere else. As tough and determined as he was as a pitcher, he was a complete rookie in the world of gaming and he should have been treated as such. Schilling’s dream has now turned into a nightmare for fans of his all across the state ofRhode Island.

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