What the hell is going on at Microsoft?

Bad news hit the Big Green twice after my last post on the subject. First, the famously outspoken Dennis Dyack and his company Silicon Knights has filed a breach of contract suit against Epic Games. The suit states:

Epic violated the Agreement with Silicon Knights by, among other things, failing to provide a working game engine, which has caused Silicon Knights to experience considerable losses and ultimately has forced Silicon Knights to spend its limited time and resources on building its own game engine rather than in developing its video game.

Obviously the issue is between Silicon Knights and Epic, but it doesn’t look good when infighting occurs between Microsoft Game Studios developers. Microsoft undoubtedly knew about this before it happened, and perhaps they tried to play mediator as they should have, but for some reason it got to this. Or maybe Microsoft was a little miffed by recent comments from Mark Rein regarding marketplace transactions and the recently-announced PS3 deal and said, “go get ‘em!”

I wouldn’t be surprised if other UE3 licensees jumped on the suit. Take for instance the frequent delays of Stranglehold and Brothers in Arms: Hell’s Highway, which both use the engine. Or Midway’s other title, Hour of Victory, which used UE3 with poor results. Could all of these instances been because Epic sold them snake oil while making themselves a fortune with Gears of War? Realistically, Midway would probably never include themselves in this suit, or at least try to resolve issues with Epic so publicly, because of their exclusive publishing agreement for Unreal Tournament III. Nothing like biting the hand that feeds you, eh?

Nonetheless, as much as I think Dyack said some things in public he should have kept discrete, he sounds like he has a case. Here is a guy who has on more than one occasion said regardless of Silicon Knights’ storied past, Too Human is the game that will make or break him. The stakes are high, and when he has so much riding on the support of others, and those people don’t come through when they should have, what else is he left to do but bite back with whatever legal means available to him? Still, it’s a PR nightmare which ends up being a reflection on Microsoft more than the individual parties involved.

The second bit of bad news may be more disguised, but that gloom-and-doom subtext still exists. Bizarre Creations, speaking on development of the upcoming MGS title PGR4, said:

[With PGR3] we just ran out of time. We feel like we’ve got more time [with PGR4]. Last time round, we feel like we got the game ripped away from us…This one, we’re not letting go ’til it’s done.

Doesn’t this sound a little like MGS has another troublemaker on the team? Someone who knows they are worth more to Microsoft than Microsoft is to them? Someone who is playing chicken with Microsoft by holding the phone to their ear and dangling their finger above the speed dial button labeled, “Sony”?

If there is one thing I know, it’s that developers should never run a publisher. Regardless of how many people at GDC think this is creative suicide and creates boiling-point frustration. Publishers have a portfolio to run, of which they plan release schedules 18 to 24 months in advance. There may be those select developers who get carte blanche to say, “it’s done when it’s done,” but not when Microsoft is trying to push console and software sales this holiday season in their race to the black. Not when they are in a crucial time during a platform war. And looking at the MGS developers, certainly not Bizarre Creations.

The good news for Microsoft? Today is Friday. The bad news? Monday is only three days away…