Hideo Kojima spoke with IGN in his first interview after dropping support for PHYSINT.

"So in June, SIE said they wanted to have a Zoom call. I was so busy at that time — I had just gone to New York for a Prada event and then to LA right after. But anyway, I came back and we had this Zoom call.

They said they can no longer fund development for Physint. I was shocked and I said, 'What did you say?' I couldn’t quite process what they had said. I wasn’t sure because I was in shock....

...So I was surprised. But not just surprised. We didn’t understand the reason. I didn't have any anger or sadness; my first thought was, 'What am I going to do with my studio?' Because we signed contracts for projects. Of course I had OD, but I only have two projects in my studio: OD and Physint. And I hire according to how many projects we have, and we have two. If we lose one contract, I thought I might have to cut all the people working on Physint, right? Or our studio could end up collapsing because we’ll run out of cashflow."

Not even the legendary Hideo Kojima is adverse to fears of his studio shutting down. It reminds me a whole lot of the "psychodyssey" that Double Fine went on and continues to play out. No studio is safe, even when you make AAA blockbusters like Death Stranding.

But this realization also makes me dislike the term "indie" when speaking about studios like this. "Indie" came to mean small, independent games, made by small teams back in the twenty-teens. When I hear "indie game," I think of Journey, Death's Door, and Outer Wilds—small teams and small games. Kojima Productions may be an independent studio, but my brain won't let me consider their work as "indie." It'd be like saying Taylor Swift is "indie" because she produces and owns her music all on her own now.

"But the number one priority is my staff. We have about 200 people, and I expanded because we had Physint. They are talented, of course. And some of them came to my studio from big corporations. I warned them it might not be a good idea to do so… But anyways, I needed to protect these important staff."

This reminded me of a quote from this article I was reading last week from Edge by Alex Spencer "The game industry is broken – can we fix it?" about Japanese developers and how they have avoided mass layoff stories like Western developers have suffered during the decade, emphasis my own:

"When it comes to the layoffs situation, Amir Satvat says, 'Japan is a completely different ballgame.' He acknowledges that the country isn’t entirely 'a utopia': there are still layoffs, and they are generally focused on contractors based outside the country, 'to protect core staff in Japan', but these have generally numbered in the hundreds rather than thousands. 'Everyone calls out Nintendo, but you can look at Konami or Capcom – these companies all have staff retention of 97 per cent plus' So, what can the west learn? 'My understanding is that, generally, Japanese teams tend to be much smaller and leaner,' Satvat says. 'They didn’t get swept up in the live-service trend, or into these mega-blockbusters with 500-person teams.' And perhaps most important of all? 'The executive salaries. They still make great money, but it’s two or three million dollars, not 30 million.'

Kojima's instincts to protect his staff are commendable and , I'd suspect, appreciated deeply by his staff. Instead of reacting with his knees, Kojima responded first by doing what he does best—writing:

"True story: after the meeting, the first thing I did was, I came back to my desk, and I started to write and add a little bit more to the concept for Physint. What had just happened was a big thing, a big incident. And so I decided to just keep it between the three of us (Hideo Kojima, Shinji Hirano and Aki Saito) for now, and we didn’t tell the staff, because we needed to figure out a direction before telling anyone."

IGN did ask about the game engine, which is something I wondered as well. Sounds like the game is still so early in production, that any sort of pivot away from Decima was not consequential. Clearly, all the posters are promoting Unreal Engine 5 and Metahuman, which is what the OD team at Koji Pro is using.

The studio also made an outright statement in response to Jason Schreier's reporting a Bloomberg. It's rare to see a Japanese studio directly address this sort of reporting, which makes me think Schreier spoke to folks on the miffed side of this decision.

Normally, we would not comment on unsubstantiated speculation on the internet, but these aspersions around our relationship with PlayStation, the commercial performance of the Death Stranding franchise, and the broader production planning and investment for Physint, have reached beyond the studio and have touched our fans, our creative partners, and colleagues we have worked alongside with for three decades.​

None of the claims written came from any official or on-the-record source and as such we encourage you to take them with a dose of scepticism.​

Make no mistake, this was a serious situation for the studio with a range of potentially significant implications. While we recognise that the article may have caused alarm, we want to reassure you all, for the record: that the studio is in a healthy, profitable state, development for Physint continues to move forward with Xbox, and our relationship with PlayStation remains strong.​

Thank you for your continued support,​

Kojima Productions​