State of Decay 3 Was Revealed Early Partly Because of the Studio Boss' Anxiety Around Xbox's Plans

According to the boss of former Microsoft-owned Undead Labs, State of Decay 3 was revealed early because of concern that the studio might have got "swallowed up or divested before we had a chance to present to the world what we were working on."

The comments came in an interview with The Game Business, during which Holt admitted that while a small team was working on the game in 2020, development didn’t pick up until 2023.

State of Decay 3 was revealed during an Xbox showcase six years ago, in 2020, two years after the release of State of Decay 2. The zombie series features a simulated apocalypse where players have to manage food, resources, and the moods of their people while avoiding having their faces bitten off by the undead.

The anxiety Undead Labs had came from Xbox’s acquisition spree. Microsoft acquired Undead Labs, alongside PlayGround Games, Ninja Theory, and Compulsion Games, in 2018. Undead Labs went independent last month, Ninja Theory developers are being laid off amid a studio closure, and Compulsion Games is charting its own path.

State of Decay 3’s announcement trailer was supposed to be a mission statement, but it didn’t really reflect what the team had, because the team had very little. “I got myself in a little trouble saying we didn’t really have a team working on the game at that point,” Holt said. “It’s not entirely true, but we had a really small team.

“It was a relatively small game inside a giant organization,” Holt said later in the interview. “I didn’t think Microsoft was done being acquisitive, and I didn’t think they were going to continue buying small developers. I figured they’d start buying big things.” Xbox announced its intention to purchase Activision Blizzard in 2022.

“I was a little worried about getting swallowed up or even divested before we had a chance to present to the world what we were working on,” Holt continued. "It was a bit of a marker on the table for me. We’re saying State of Decay 3, we’re announcing it, it’s public, the audience now knows it’s in development.”

Elsewhere in the interview, Holt talked about development of State of Decay 3, which was largely informed by post-launch updates to State of Decay 2. State of Decay 2 became a laboratory to test ideas for State of Decay 3 — "it all informed design for State of Decay 3," Holt said.

State of Decay 3 remains in active development, despite significant layoffs at Undead Labs, and it will launch day one on Game Pass. The cuts came after the studio split from Microsoft and went independent.

Last month, Halo Studios also suffered layoffs. Meanwhile, Halo has been given to Activision, who will assign a team to work on the next game in the Halo series.