How did this happen to Realtime Worlds? That's the question most industry pundits have been asking all week. APB was going to be the Grand Theft Auto of the 21st century – a freeform cops'n'robbers shootfest, taking place in a massively multiplayer universe where player characters were infinitely customisable. Realtime Worlds, founded by Grand Theft Auto creator Dave Jones, was the giant of the Dundee games community, the lynchpin amid a thriving enclave of studios, many spawned from Jones's original company, DMA Design. Last week, however, Realtime Worlds went into administration with the loss of 150 jobs. The developer had apparently burned through $105m in funding. It was the Heaven's Gate of gaming.

Here's what's left. APB has a small staff, managing the game for its 130,000 or so registered users. Meanwhile, another twenty developers are on Project MyWorld, a hugely innovative and ambitious social gaming platform that's been in development for several years alongside its higher profile stable mate. Administrator Begbies Traynor says it is looking for buyers and has had promising meetings. Nothing has been confirmed yet.

Those are the facts, but they tell a fraction of the story. Gamesblog has spoken to two ex-RTW staff, who wish to remain anonymous. They have much more of it...



First of all, some employees saw this coming months ago. Amid all the pre-release hype surrounding APB, pockets of staff within Realtime Worlds were already scared for their jobs. "The first hint we got was, a few months before APB launched, the company started, quite bizarrely, to make cleaners redundant. I thought that was rather suspicious," says an ex-member of the MyWorld team. "Later, rumours started coming in from Ruffian Games [another Dundee development studio, formed by ex-RTW staff], that redundancies were imminent. And then RTW let all the contractors go early, which was another sign that money was running out. But they said everything was fine."

It wasn't. When APB was released on 29 June, it was clear the game was nowhere near ready. The shooting mechanism didn't work, the vehicle handling was sluggish, the matchmaking system was hopelessly inaccurate. When Gamesblog previewed the game eariier this year it was running on a LAN and seemed fast enough – and potentially, enormous fun. But the reviews were mostly damning – there was much talk about potential, about ambition, but the Metacritic rating, which currently stands at 58, tells its own damning story. Jones tried to suggest that reviewers didn't understand the game, that it wasn't GTA, that there was no pre-written narrative – it would all come from emergent player activity. Really, though, the game wasn't good enough.

"We were getting the data every week and we could see what the sales were like," says one member of the APB team. "It was very clear to us a number of weeks ago that the game was not selling in the quantities that the projections told us it would. Couple that with the feedback we were getting on the forums and add in the reviews … it wasn't painting a great picture. And it became clear that APB was not sustainable given the revenues it was generating. The dev team didn't need management to tell them that.

"At the beginning of August a board meeting was scheduled which everyone knew about – because, you know, people talk. And it was widely known that the board was discussing the performance of APB and how they were going to address that. So everyone was on tenterhooks – and a lot of people expected there to be a fairly significant change as a result of that meeting. But it took the board another week or so to gather more financial data before they could make a decision. Pretty much the whole of August has been horrible for the team, because they knew something was going to happen, but they didn't know what."

There had, in fact, already been a few redundancies on APB in early July. At the time, this was put down to streamlining in the wake of the game's release. Then on 13 August, the news broke that the entire MyWorld team was being laid off. "APB continues to be our primary development focus, and we remain fully committed to the game and its players," was the terse statement. "We were told that the budget for our game had been spent on APB," adds our insider, bitterly.

But because of the reviews, the rumours, the disappointing beta tests, there weren't enough players. That was the killer.

And you've just got to ask again, how did this happen?

There's no doubting the calibre of the team. Lead designer EJ Moreland came in from Sony Online Entertainment where he worked on Everquest II; before that, he was a designer on the formative Ultima Online franchise. Brian Ulrich, the company's director of development, came from EA Sports. As for the rest, within two days of the administration announcement, the likes of Sega, Blitz and Activision were flying up to Dundee to set up recruitment events. This was a talented, respected outfit.

But from listening to staff, from following subsequent Twitter conversations and blogposts, it's clear huge mistakes were being made. "If we're being brutally honest, we didn't pay enough attention to the design of the game," says Gamesblog's source on the APB team. "When you're working for someone like Dave, it's all too easy to not believe what your ears and eyes, and QA and beta testers are telling you. You're like 'Dave knows what he's doing, it's going to be fine'. The team was saying for a long, long time that there were things that were not quite right with the game … It was never the case that the design was fundamentally broken, but in the execution of a lot of the features there are things that didn't quite come together, that weren't polished to the level that people expected."

Even within the MyWorld team, the APB troubles were tangible. As our source says, "The middle management – and there was a LOT of middle management at this company – they were on that game for years and they continued to run it as though they were managing an architecture project or something. Fun never seemed to be a criterion for what they were doing; managers with little clipboards would go around and tick off things, saying 'OK that's done' and moving on. There was never any consideration for whether or not what had been done was any fun."

Another part of the problem, it seems, was the money. There was simply too much of it, and no one had come up with a plan on how to spend it effectively. "Having too much money is as much a curse for start-ups as having too little," says Nicholas Lovell of business blog Gamesbrief. "Instead of identifying clear market opportunities, focusing resources and worrying about delivery, too much money gives you the licence to meander, experiment and play, and the absence of direction can be masked by the money for a very long time.

"This clearly happened in the case of Realtime Worlds. The company meandered with both MyWorld and APB with no clear sense of direction. That makes sense on a Facebook game with a budget of $300,000, or the original budgets of Lemmings and GTA, but not any more."

This idea of a rudderless development schedule tallies with other reports coming out of the company. When PC gaming site Rock, Paper Shotgun ran a story on the earlier RTW redundancies, someone claiming to be an ex-staff member wrote in the comments section: "Certainly Dave J has great, strong, ambitious ideas for his games. But he's a big believer in letting the details emerge along the way, rather than being planned out beyond even a rudimentary form. For most of the lifetime of APB, he was also CEO of the whole company, as well as creative director. His full attention was not there until it late in the day."

"There wasn't enough discipline," confirms our source. "We got all this money, and it made us relax, when really it should have focused our attention on making sure we had a really good approach to managing the project, to ensuring the design was exact what it needed to be, to focus testing early on, and just proving that we were doing the right thing, rather than taking the old 'it'll be done when it's done' attitude." And then suddenly, Electronic Arts, the game's publisher, wanted the game out. Not an unreasonable demand after five years in development.

Last Tuesday, the administrators arrived at Realtime Worlds and from the reports Gamesblog has heard, the APB team was rounded up into the cafeteria and informed of the situation. Over the next 24 hours, staff were told whether they would be kept on or not. Most weren't. "It wasn't apparent that there had been any contingency planning," says one source. "We all expected APB to be this massive success, we all expected to be printing our own cash, a la Blizzard. I feel like our exec team got out of their depth – I don't mean that in a cheeky way, because we were all out of our depth, but it kind of felt like it was a train that was out of control – and had been out of control for a long time."

Since then, anger and resentment have spilled onto the internet's many outlets. On his personal blog, under the headline, 'Goodbye Realtime Worlds', ex-RTW staffer Luke Halliwell posted a measured and thoughtful summation of the situation:

"I must say I was shocked at quite how quickly it went down in the end. It felt like we were being let go decently, and then BOOM – not getting paid anything, owed last month's wages, our notice periods, redundancy pay and unused holidays. A substantial amount of money, all told."

He later updated the article: "Turns out we got 2 days' pay!! Not much but better than the previously-expected nothing."

In the comments section, his wife delivered a much more vociferous response:

"Dave Jones and Ian Hetherington have pissed away millions, they are getting away with not paying over 200 employees for the work that they have done ... Moreover these very people have enough personal wealth to pay the money owed to the individuals and families whose lives they have left shattered, heck Dave could probably pay them all just by selling one of his beloved cars."

It has to be said, though, that the animosity toward Jones is certainly not universal within the company. He's clearly liked and respected, and our APB source said that he spent Wednesday afternoon touring the building, apologising to staff: "One thing I've learned is, you shouldn't confused creative genius with shrewd business sense. But Dave was very visible and very upset. He feels bad about the effect this will have on people's lives."

There are many question marks over the demise of this massive company. Why wasn't there a strict development structure in place? Why weren't the problems within APB spotted earlier and dealt with properly? How could the whole issue of latency, especially with an action game running predominantly on the server rather than client side, not have been adequately predicted?

How could this happen?

Well, it has happened before. The ambitious science fiction MMOG Tabula Rasa, created by another talismanic designer Richard Garriott, was delayed before its release in November 2007, having been in development since 2001. Barely a year later, the development team announced that the game would be shut down due to a lower than expected user base. There are obvious parallels. Surely, there were lessons to be taken?

In the end, it would appear to be a story of hubris and mismanagement, of artistic vision clashing with the realities of 150 staff members working on a game that had no proven antecedents and no clear direction. What it had was confidence. "The truth is there was an arrogance," says our insider. "I think we all got caught up in it – not one of us can stand back and say we weren't a part of that." As a lot of reviews pointed out APB would have been an amazing game in 2006, or at least an amazing start of a game. But this is 2010, and smaller companies with greater agility are doing more interesting, coherent things in the massively connected gaming sector. Realtime Worlds was the dinosaur being eaten alive by insects.

A few days ago one ex-employee tweeted about passing the office on the bus. The building looked weird, near empty, no one visible at their keyboards. The rumours are that Ian Hetherington, the chairman of RTW, will put in a bid for the MyWorld IP. Perhaps someone else will come in for APB. It has those 130,0000 players, and there's apparently a 1.4 patch ready that addresses some of the handling and shooting problems. And really, 130,000 isn't a disastrous start for an MMO. They usually take a while to grow – even World of Warcraft took almost six months to get to 1.5 million players. But when you've already spent $100m, time isn't going to be on your side.

For a lot of the staff, however, it's too late. They will drift away, hopefully to other industry jobs, possibly abroad. Despite what some opportunistic politicians tried to claim in the aftermath of Tuesday's announcement, this one couldn't be put down to the lack of tax credits for the UK games business – Realtime Worlds had millions and millions of dollars in investment. But ironically, foreign developers may well benefit anyway, through quick-witted recruitment.

However, these staff will be leaving behind a company they cared for and a game some of them worked on for six years; a game that may now disappear within months of its release. "That's the tragedy of it," says the APB team member we spoke to. "For me, it's not really about APB in the end, it's about all these people who have poured years of tremendously hard work into this thing. They were so passionate, so enthused, it should have been so much more. And in the end they walk away with nothing."

Gamesblog was unable to contact members of the senior management team for their comments.