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Amazon reportedly saved Crytek with $50-$70 million licensing deal
Crytek, the German studio behind CryEngine and games like the Crysis franchise, faced some tough financial challenges at the end of last year. The developer appeared to have trouble paying some of its employees on time, and it was reportedly forced to cease development on a sequel to Ryse: Son of Rome. Earlier in March, Crytek announced that it had made a huge licensing deal with a large corporation, and now reports have surfaced saying that corporation was Amazon.
In an interview with Eurogamer last year, Crytek co-founder and CEO Cevat Yerli explained that the studio’s troubles were a result of its transition toward free-to-play games. “That shift required a whole different capitalization, as well as additional talent pool and different types of spending and forecasting,” Yerli said. “All of that caused temporarily diminished capital resource, which we have now overcome. This was the main cause of the situation – the whole transformation of Crytek.”
One consequence of this “transformation” was the downsizing of Crytek’s development team in Austin, Texas, which had only existed for a relatively short time, as well as a serious hit to company morale due to unpaid wages.
“It’s not an investment”
In the interview with Eurogamer, Yerli could not name its new partner, but he said, “It’s not an investment, and Crytek has not been bought. It’s revenue. It’s purely revenue.” He also hinted that the deal could be sizable, saying it could be “a big one” and confirming that Crytek is now safe and in no danger of going under.
According to reports by Kotaku, several sources have stated that the partner in Crytek’s “big” licensing deal is Amazon, who reportedly paid around $50-$70 million, giving the struggling developer some much-needed capital.
While it is not clear yet what Amazon plans to do with CryEngine, the company has been quietly expanding into the video game industry thanks to its Fire TV streaming device. It also develops its own games through Double Helix Games, LLC, which Amazon acquired last year, as well as through Amazon Game Studios, and both could benefit from access to CryEngine and its tools.
Image credit: Crytek (c)
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