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Baidu Rumored to Have Its Entire Game Division Sacked, Despite Having Just Announced a Series of Games in Development This August

Some people might get an unexpectedly long Christmas break
By Isabella Jiangcheng
Dec. 28, 2021 updated 02:58

Earlier this week, several sources have circulated the rumor that China’s most prominent tech conglomerate Baidu has a massive layoff in its MEG (Mobile Ecological business Group) division. The alleged news was first disclosed on social media. According to sources who claimed to be familiar with the matter, more than 300 game development and publishing team employees were sacked with only a two-day notice. At the same time, other teams such as live streaming and education also suffered lesser layoffs.

Anonymous post on Maimai attributed the layoff to Baidu’s new CEOAnonymous post on Maimai attributed the layoff to Baidu’s new CEO

On Dec. 23rd, an anonymous employee reached out to news outlet Pengpai and explained that the adjustment within MEG was ‘minor’ and affected only a small number of personnel. However, according to other sources from Sina Tech, the layoff is not ‘minor’ but is, in fact, the largest layoff since 2018. Employees from the discontinued teams were not given a chance to transfer to any other Baidu division. They were encouraged to find a new job the next day – a piece of unusual advice for tech employees, who are usually bound by a non-competition agreement. Baidu has not responded to any media requests as of press time. 

Many are surprised by the harsh layoff in Baidu’s gaming team. Only this May, Baidu had re-registered the trademark ‘百度游戏MG. BAIDU.COM DU’ (Baidu Games). And during ChinaJoy 2021, Baidu introduced 14 casual games and nine core games to show its ambition in reviving its entertainment branch. On the day of the alleged layoff, Baidu’s newly launched game Digimon: Source Code reached no.1 on TapTap’s Pre-registered chart. But after looking at Baidu’s Q3 financial report with a net loss of 16.559 billion CNY (~ 2.60 billion USD), many also believed that Baidu could no longer sustain its business operations.  

Players have high expectations for the Baidu-Namco collaboration on their childhood anime.Players have high expectations for the Baidu-Namco collaboration on their childhood anime.

It has been a very different Christmas Eve for the Chinese gaming industry, with little to rejoice. Baidu was not the only company that decided to cut off the game division. Influential tech giants including Bytedance, Kuaishou, and iQIYI have all been rumored to scale down their game divisions. Ohayoo team, Bytedance’s casual game division, was infamous for allegedly laying off its newly recruited graduates who worked in the team for less than a year so that the company did not need to pay a high compensation. With game publishing licenses frozen since July 22nd and no sign of re-issuing in the coming weeks, we will likely be hearing more speculations on layoffs in the game industry.