Jerk Gustafsson, studio director at MachineGames, is excited about the company’s new office in Sundsvall, which is around three and a half hours north of the company’s headquarters in Uppsala, Sweden. “We have had a few programmers from that area working for us for a long period of time, amazing talent. And then we started to work with a couple of more guys up there, and eventually we ended up feeling that, well, we have so many people that are working from up there now, so we might just provide them with a small office space.”

This might seem small beans in the grand scheme of things: it’s hardly Earth-shattering news to hear that a well-known studio is opening a satellite office (which has actually been in operation since 2023, but is now being beefed up somewhat).

However, it’s important to take the context into account.

The news comes at a time when other Swedish studios are contracting or closing completely. Ubisoft recently announced the shuttering of its Stockholm office, Starbreeze has reportedly initiated two waves of redundancies in the past 12 months, and Exoborne maker Sharkmob announced a restructuring in November. The Swedish games industry might be growing overall, but that growth is far from even.

Clearly, then, MachineGames is doing something right. And it’s notable that when Microsoft made swingeing cuts to its game division last summer, MachineGames emerged relatively unscathed.

Gustafsson says that very little has changed since Microsoft bought MachineGames’ parent company ZeniMax Media in 2020, with the exception that nowadays they tend to plan much further ahead. “I think that’s the key,” he says. “When you operate in this type of organisation, I think you need to be very transparent. You need to be very open about what you want to do, and you need to deliver on what you say you will deliver on. So I think for MachineGames, it’s very important to have a very clear plan. And obviously they can question that, and there might be discussion around that, but there are no surprises.”

MachineGames plans “at least a couple of games” ahead, and if anything needs to change for whatever reason, “then we can adjust very early,” says Gustafsson. “I think it would be a lot worse if we were in a position where we ship a game and then we started to try to figure out what to do next.” And if MachineGames didn’t have that long-term plan, one can speculate, it would make it much harder to justify your studio’s continued existence to the higher-ups.

Lean operation

The fact that MachineGames is only expanding to a second office now, as it celebrates its 15th anniversary, is perhaps another indicator of how the company has managed to last so long. Whereas other firms embarked on rapid expansion following the windfall of the COVID years, MachineGames has remained a modest size throughout its existence, still numbering fewer than 200 employees.

“I like the idea of keeping it as lean as possible,” says Gustafsson. “I know everybody’s name, I know everybody on the team.” Like Adrian Chmielarz at The Astronauts, he thinks that when you stop recognising people, it’s a sign the company has grown too big. There is no danger of that happening at MachineGames, however: even with the new satellite studio, Gustafsson has no aspirations to grow the studio much beyond its current size.

Yet there’s a problem with that. As their AAA titles get bigger and more ambitious, Gustafsson admits it’s getting harder to develop games with the scope they want. That’s where outside help comes in. “Obviously, we use a lot of partners, and I think one of the most important solutions is to find partners that you can rely on, and build long-term relationships with,” he says. “We also have a very good relationship with our sister studios, which I think is also a very important part of it, because together you can manage resources in a very efficient way.”

It works both ways: when one of their titles is in pre-production and hence requires fewer staff, the team can help out Bethesda’s other studios, leading MachineGames to work on id Software’s Doom: The Dark Ages.

Gustafsson says it’s a “win-win” situation, because not only do the sister studios benefit, MachineGames’ staff also get to experience working on different games and see how other studios work. He sees it as one of the great positives of being under the Microsoft umbrella. “Often we hear, ‘Oh, it would be amazing to be independent,’ but it’s actually quite nice to be part of a bigger organisation in that regard.” It also engenders a sense of healthy competition: the need to ensure the quality of MachineGames’ work matches or exceeds that of the other ZeniMax studios. “We can’t be worst in class.”

But why expand to Sundsvall? Why not open a studio in, say, India or South America? Many games jobs are moving from expensive locations in the US or Northern Europe to emerging hubs around the world, but that was never a consideration for Gustafsson. “I haven’t even thought about it,” he says. “Obviously, we have partners that we work with that are in countries where the … cost is a little bit cheaper, but even there we prioritise looking at the quality output of those partners [more] than anything else, because that’s the important part of it.”

There’s also something symbolic about Sundsvall. Gustafsson got his start in the industry working on titles like The Chronicles of Riddick: Escape from Butcher Bay at Starbreeze Studios, which was founded nearby. “It’s almost like going back to the beginning when you go up there,” he says. A circle completed.

“One of the things I love about the office up there is that it’s smaller,” continues Gustafsson. “We always try to work a lot on collaboration and teamwork in general, but in a small space it becomes very focused and friendly and an overall nice environment to work in. And the team up there are very genuine and nice – something the northerners in Sweden have a reputation for.”

Back to the office

But that focus on close teamwork is also behind one of Gustafsson’s more controversial decisions: to encourage employees to work in the office rather than remotely. Ubisoft was heavily criticised recently for asking all of its staff to return to the office, and although Gustafsson doesn’t want to comment on Ubisoft’s decision, he does point out that office working tends to be less onerous in Sweden, since many employees tend to live within a short commuting distance of work, whereas commutes can be much longer in countries like the United States.

MachineGames doesn’t ask all of its employees to work full time in the office: many of its developers work in a hybrid pattern, spending three days in the office and two days at home, and there is room for some flexibility. But the company insists that the senior staff – directors, leads, and producers – are in the office five days a week, and Gustafsson says the studio is “moving more and more” to being in-office.

“From my point of view, and from MachineGames’ view, we see ourself as an in-office studio, because we know that we are a lot more efficient and a lot more collaborative in general when we’re actually in the office together. It is an improvement in how we operate.

“That is also part of the reason to start something up in Sundsvall, too, because then we provide them with an office space as well, so we don’t have a group of people that are always remote.”

“We feel that we are more efficient and more productive when we’re in the office”

It’s one of the more contentious issues in the industry. Encouraging remote work can enable companies to tap into the best talent, irrespective of location, as well as freeing employees from a tiresome commute – something Kirsty Rigden, head of the remote-first studio FuturLab, enthused about recently. But it comes at a cost. “It’s really hard to make people feel constantly connected,” said Rigden. “There’s more meetings than there would be otherwise, because you’ve got to really make sure that lines of communication are open and everyone’s in alignment.”

Gustafsson is convinced that the benefits of working in-office outweigh the negatives. “We feel that we are more efficient and more productive when we’re in the office,” he says, adding that gathering people together dovetails well with the studio’s relatively flat hierarchy and open-door policy. “We really put a lot of effort into being interactive, going and talking to people regardless of their role in the company, and always being approachable: basically fostering a culture of dialogue and discussions related to how we want to design and develop the games. And I think that has also helped us build stronger games, where everybody feels that they don’t have to worry about coming with ideas or giving feedback. I think that type of culture is very important for us. And if we are together, face-to-face, it’s a lot easier to handle that instead of working isolated from your own home.”

Indiana Jones

MachineGames picked up numerous awards for Indiana Jones and the Great Circle, which made the leap to PS5 last year, and which will be coming to Switch 2 on May 12. But Gustafsson acknowledges what a departure that game was for the studio in terms of going outside its gory FPS comfort zone.

“I think the big difference for us initially was that we needed to think about a game that is much more mild, especially in violence and gore. This is actually the first teen game that we have ever done: we have always done mature games before, so that was a big change for us.”

The studio knew it could ace the shooting aspects of Indy without a problem, but hand-to-hand combat, puzzles, and exploration were aspects they hadn’t tackled before. So they went back to their roots as a studio formed by former Starbreeze employees, drawing on the gameplay of The Chronicles of Riddick from 2004. “We went back quite a lot to that.”

Yet this was also a game that only really came together right at the last moment. “It was very hard, and maybe I failed there in a way,” admits Gustafsson. “It was very hard for me to make the team understand what we were actually trying to achieve. It was very late in production, maybe even as late as the final year, before members of the team actually started to understand what the game we were building was.”

Yet the game’s critical success in an unfamiliar genre has also been inspiring in terms of trying something different. “We have been doing very, very similar games, and very, very focused on first-person, story-driven titles for a long time,” says Gustafsson. And although the studio loves doing those games, he says, they are “looking more to see what we can do to innovate and expand within that genre. I often see us being able to do a mobile game. It just requires a different skillset that we don’t have at MachineGames. Maybe sometime in the future, but who knows?”

He’s also aware of the need to keep the team happy, and to follow their lead in some respects. “I think that’s the most important part for me, because the team needs to be excited and passionate about the work we do, otherwise we won’t be able to deliver a good result,” he says.

Furthermore, he’s cognisant of the need to “justify the business side” of whatever project MachineGames works on to Microsoft’s leadership. And ultimately, the possibilities are constrained by the unrelenting march of time. “There’s so many things that I would like to do, but I’m also getting a bit older, so I don’t have that many games left in me. It takes a long time to make a game now, and let’s say that we release one every four years, then maybe two more, maybe three if I’m lucky.”

Will one of those games be the rumoured Wolfenstein 3? Gustafsson won’t confirm the rumours, but will say that “our intention has always been to go back to Wolfenstein. We wanted to finish the trilogy. And when we do that, that is something that I don’t want to comment on. It can be now, it can be later, but we’re not done with it. That’s what I can say.”

The future

There’s a sense that MachineGames is one of a dying breed. “I still hope that there will continue to be a market for the type of games we do, because obviously we love to do them,” says Gustafsson. “And to be honest, I also see less of them, especially when it comes to what we call AAA.”

The travails facing AAA development are well known, with spiralling costs and worries about a plateauing market. But Gustafsson sees signs for optimism. “I think the audience still is growing,” he says – at least for the moment, anyway. “I am 54 years old now, and I grew up with games – but I think I was also the first generation that grew up with games. So when I’m going into retirement, when I’m 70 years old, that should be the peak. That should be the peak of our install base, that should be the peak of people that have actually grown up playing games on a daily basis. So we shouldn’t be there yet, because it doesn’t make sense that we are there yet.”

Yet there still remains the problem of the huge and increasing cost of AAA development. Raising the price of games is an undesirable option, because the risk is that you “lose some players,” says Gustafsson. Instead, he thinks the solution requires addressing three questions. “What can you do in terms of being more efficient? What can we do to continue to promote our products? What can we do with our back catalogue to make sure that our older games can bring new life into those new platforms?”

“I think it’s great that we can try to expand beyond just games”

MachineGames has always been scrupulous about the first of those three, he says, ensuring that they don’t build anything that they don’t need. “We don’t throw away work,” Gustafsson says, adding that the studio is “mindful about scope.”

The second option, promotion, is also something that MachineGames is pursuing via transmedia, having given the green light to a TV adaptation of the Wolfenstein games. “I think it’s great that we can try to expand beyond just games,” says Gustafsson. “I think that is something that we always should be looking at to see how we can make the business more profitable. Obviously our goal at MachineGames is to foster a very creative environment and make amazing great games, but at the same time, in order to do that and get that opportunity, we also need to make sure that we can be profitable.”

There’s another strategy, of course: just make good games. It’s a strategy MachineGames has been pursuing relentlessly for some time now, and it’s more important in games, perhaps, than in any other medium.

“If you see a movie that gets a super, super low score, basically on red on Metacritic, it can still be a big monetary success,” says Gustafsson. “It’s very hard for a game to achieve that. If you have a game that has a very, very low score, it’s very hard for it to be successful. You still need to reach a very high level of quality in order to be successful. Even though it might not be a guarantee, you still need to do it.”