The story
Foundation and initial growth (2004–2010)
Telltale Games was founded in San Rafael, California, by Kevin Bruner, Dan Connors and Troy Molander, a group of former LucasArts employees who worked on the studio's adventure games. In March 2004, LucasArts recognized that there were "current market place realities and underlying economic considerations" that made adventure games too risky to release, and canceled work on two sequels of previous adventure games, Full Throttle 2 and Sam & Max: Freelance Police, as well as laying off many of those developers. Bruner, Connors and Molander were not among the layoffs, but felt that the change of direction at LucasArts was not favorable, and departed the company later that year to found Telltale Games in July 2004. The studio opening was announced on October 4. The name "Telltale" was selected by Bruner as the three envisioned themselves creating more adventure games but de-emphasizing puzzle elements in favor of narrative aspects, telling a tale to the user. Technology attorney Ira P. Rothken negotiated publishing and licensing deals for the company.
The company's initial goal was to develop a new Sam & Max game in an episodic format. Grossman said that Telltale identified that Sam & Max had a small but dedicated audience allowing it to develop a title that would be successful in reaching out to this group and not requiring it to seek out a bigger license that would have incurred more development costs. Developing a Sam & Max game required both development of tools to produce the game, and the license to make it. At the time of the studio's founding, the license for Sam & Max was still held by LucasArts, who refused to negotiate a deal nor license the work on Sam & Max: Freelance Police for Telltale to complete it. Telltale waited out the licensing period until around mid-2005, after which Steve Purcell, Sam & Max's creator, immediately offered the license to Telltale.
Until they could get to that point, the studio developed other games to bring in revenue and keep the studio afloat. On February 11, 2005, the company released their first game, Telltale Texas Hold'em, a poker card game simulator which was intended primarily to test the Telltale Tool, their in-house game engine. They used the license around Jeff Smith's Bone comic book series to test the episodic format. Though initially planned for a five-episode series, Telltale only released two episodes in 2005 and 2006 and the remaining episode had been canceled. Alongside Bone, Telltale developed a series of games for Ubisoft around the CSI television series, including CSI: 3 Dimensions of Murder, CSI: Hard Evidence, CSI: Deadly Intent, and CSI: Fatal Conspiracy; though these games were also developed as episodes, they were each released in single packages. Outside of Ubisoft, few other publishers were interested in distributing Telltale's early games, forcing them to turn to their own distribution system.
Once they had secured the rights to Sam & Max, Telltale set about to making this game with an episodic approach, with episodes planned to be released on a tight monthly basis through their partner, GameTap. Sam & Max: Season One was considered a success for the company, and considered one of the first successful demonstration of an episodic release in video games. The success led to additional funding through two rounds of angel investment, including Matthew Le Merle and members of angel group Keiretsu Forum. The studio created a second season for Sam & Max, and found additional niche intellectual property areas, including Wallace & Gromit and Homestar Runner, to continue the episodic adventure game format. When Darrell Rodriguez became CEO of LucasArts in 2008, he wanted to see the old LucasArts adventure properties flourish, leading to a license for Telltale to create a new game in the Monkey Island series, Tales of Monkey Island. Telltale was also able to expand their release platforms beyond personal computers, with releases of these games on various consoles at the time.
To supplement their normal episodic games, Telltale created a pilot program in early 2010 to explore one-off games that would explore other gameplay and storytelling approaches that could eventually be incorporated into their episodic games. The first game, Nelson Tethers: Puzzle Agent, a puzzle-solving game in collaboration with Graham Annable, was released in June 2010, while Poker Night at the Inventory, a crossover poker game featuring characters from Sam and Max, Homestar Runner, Valve's Team Fortress 2, and the webcomic Penny Arcade, was released late in 2010. Telltale followed up Puzzle Agent with a sequel, Puzzle Agent 2, in 2011. In 2013, Telltale continued the series with Poker Night 2. The Walking Dead started out as a pilot program game that was known internally as the "zombie prototype". In general, few of these games brought in large revenues, and until 2010, the founders feared that investors would suddenly pull out of the company and would force its closure.
Major franchise acquisitions (2010–2016)
Having established themselves as working with comedy franchises, Telltale chose to work with dramatic franchises as well as comedy series. In June 2010, Telltale announced that they had secured licenses with NBC Universal to develop two episodic series based on Back to the Future and Jurassic Park. Notably, Telltale's Jurassic Park: The Game was the first game to break away from the standard adventure game format, including elements like quick time events and time-limited choices which would become a core gameplay element in its future adventure games. Telltale obtained the license from NBC Universal to develop episodic series around the Law & Order franchise in April 2011.
By 2010, Telltale had proven itself successful, with yearly revenues of $10 million, 90% greater than the previous year. Part of this was attributed to Back to the Future: The Game, which Steve Allison, the senior vice-president (VP) of marketing, called in 2011 their "most successful franchise to date". Allison stated that for most of its games, it only needs to sell 100,000 copies to break even, but many of its recent releases have seen twice that number or more. The studio expanded from 90 to 140 employees. They had obtained a license in 2011 to develop a King's Quest adventure game based on the original Sierra games, but Activision took back the rights in 2013, which were subsequently used by The Odd Gentlemen to create its 2015 episodic King's Quest game.
Telltale's breakthrough success came with the licenses of the comic book series The Walking Dead and Fables in association with Warner Bros. Interactive Entertainment in 2011. Allison anticipated that The Walking Dead series could be a $20 to $30 million franchise. Their The Walking Dead video game presented an alteration of Telltale's approach, as rather than a traditional adventure game where players would need to solve puzzles, The Walking Dead was more focused on providing a cinematic experience but presenting choices to the player, either through dialog trees or through quick time events, that would create "determinants" that would feed into latter parts of the episode and into future episodes; one example would be deciding which of one of two characters to save from a zombie attack at the spur of the moment. While these decisions do not have a direct impact on the game's overall narrative and structure, it provides a more personalized story around what decisions the player had made. This format proved highly successful: the game sold one million copies in 20 days, exceeded 8.5 million episode purchases by 2013, and an estimated $40 million in revenue. The success led to two additional 5-episode seasons, a 3-episode mini-season and a final 4-episode season. The Walking Dead is considered to have revitalized the waning adventure game genre due to this more emotionally driven focus. Since The Walking Dead, nearly all of Telltale's games have used a similar approach of being built around the impacts of the player's choices as determinants in later episodes and seasons.
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Telltale has had several other licensing details from popular works, including Tales from the Borderlands based on the Borderlands series by Gearbox Software, and Game of Thrones, based on the HBO television show adaption, Minecraft: Story Mode based on the Mojang game, Minecraft, Batman from DC Comics, and Guardians of the Galaxy: The Telltale Series from Marvel Comics. On retrospective after the studio's closure, former employees of Telltale believed that the studio's expansion into all these additional licensed properties were trying to replicate the success of The Walking Dead, moving the company from a risk-taker to seeking risk aversion strategies. This was also propagated by the weight of the licensed properties: they had taken more conservative approaches to deliver a game that mirrored The Walking Dead, a well-known product, rather than take risks and potentially lose the license.
Telltale relocated to a larger space and expanded from 125 to 160 in mid-2013. Around 2015, the company had grown to 200 to 250 employees. The company continued to grow, at its peak having about 400 employees in mid-2017. In the midst of this growth, in 2014–2015, the management of Telltale recognized the need to restructure to handle more projects and more staff. This led to original chief executive officer (CEO) Dan Connors resigning and being replaced by co-founder Kevin Bruner, who was also the firm's president. Connors noted that with the studio's continued growth, it had begun experiencing growth-specific challenges. Connors stated that Bruner's ascension to CEO would best enable Telltale Games to act on future expansion opportunities. Connors remained on the board of directors, and also served as a creative consultant. Internally, there were concerns about this transition and Brunner's influence on it; an anonymous quality control (QC) employee writing in Gamasutra after the firm's closure called this transition "the beginning of the end" for Telltale.
With Bruner's placement as CEO in January 2015, Telltale said it was developing a game based on its own intellectual property as a result of this leadership change. In February 2015, Lionsgate announced an investment within Telltale Games to produce a number of "Super Shows", a hybrid interactive work combining television and video game elements, which would be distributed through non-traditional channels such as through streaming services. The first Super Show planned was an original intellectual property (IP) developed by Telltale that would be able to take advantage of this format. Telltale also announced that Lionsgate CEO Jon Feltheimer and Unity Technologies CEO John Riccitiello joined Telltale's board of directors. Alongside this, Lionsgate had invested US$40 million into Telltale. The "Super Show" concept never got out of pre-production, due to issues that arose with the studio in 2016 and 2017, according to Variety.
Restructuring (2017–2018)
By 2016, Bruner said that the Telltale studio had established an environment to be able to work on four major titles simultaneously with room for various side projects. However, this approach to development had created a perpetual state of "crunch time" within Telltale, according to several current and former staff speaking to USgamer, The Verge, and Variety in 2017. This limited the amount of time that the creators and developers could spend on content in order to maintain a consistent flow of episodes to consumers but impacted the quality of games. There was a perpetual drive to release new episodes on a regular basis, whether they were good or not, so that the company had a continued source of income. This particularly affected the Telltale Tool, the game engine used since the company's inception, which caused numerous bugs in released episodes. The anonymous QC tester stated that their department was nearly always under crunch time, working from 48 to 60 hours a week on testing at least two-game series across multiple platforms simultaneously, and were understaffed, leading to some of the quality control issues as well. During this time, the eighth generation of video game consoles emerged, and while the Telltale Tool was ported to these platforms, it showed its age in graphics quality, which also diminished Telltale's products. There was also a new trend of major AAA titles focusing more on emotional story-telling, such as God of War, which Telltale would not easily be able to compete with.
The company was also hobbled by working with established IP, and inconsistencies in the reviewing process with management that led to last-minute reworking of some episodes. The Verge also found some of the employees they spoke to had stated that top-level executives, including Bruner, had become fixated on the format that The Walking Dead presented, making decisions that prevented developers from looking at alternative formats or variations from this formula, stifling creativity and leading to several staff departures prior to the 2017 layoffs. According to narrative designer Emily Grace Buck, management would frequently demand rewrites of materials, with most games having between 60 and 90 percent of the content reworked after executive review. Bruner and management created a "culture of fear" of demotion or firing among developers. Some of these rewrites had come days prior to an episode's submission date for certification, creating hasty rewrites that filtered through the entire production process. This rush created some of the apparent "bugs" in the Telltale Tool which Buck stated were more often a result of the inability to smooth out hastily reworked animations as well as perpetuating the crunch time culture within the company. Other cases of narrative rewrites were a result of different expectations by some of the executive management. Buck stated that they had originally been driven by management to make Minecraft: Story Mode as a more mature game, but eventually reworked this to a family-friendly title, while for their Guardians of the Galaxy game, the storywriters had written a story they felt more true to the humor and wit of the source material, but were told by management to make a darker story. Further, anonymous sources from Telltale stated that very few of the games were profitable, with only The Walking Dead: The First Season, Minecraft: Story Mode, and revenues from publishing 7 Days to Die turning a profit. Batman: The Telltale Series, released in 2016 was said to be one of the worst commercial failures for the company.
On March 15, 2017, Bruner announced he had stepped down as CEO of Telltale, though Variety reported that he had been voted out of this position by the board of directors. Bruner turned the day-to-day operations to Connors, while still remaining on the board of directors. Bruner said "The time has come to pass the reins to someone that can better drive Telltale to the next level and realize all the potential that is here." Pete Hawley, the former VP for Games at Zynga, was announced as the new CEO, with Connors remaining on its Board and acting in an advisory role. Rather than other corporate "fixers" who take control of a company for a temporary period to help it regain its financial footing, Hawley had committed to staying with Telltale after helping the company to get past these problems.
In November 2017, a restructuring of the company cut about 90 positions, about a quarter of their staff, which was not expected to affect the release of any existing projects. Hawley said that the restructuring was for "reorienting our organization with a focus on delivering fewer, better games with a smaller team". While Telltale had not stated which positions were let go in the restructuring, sources speaking to USgamer stated that most were part of the management structure that led to these problems; coupled with Hawley's appointment as CEO, this was expected to be a turning point to help revitalize Telltale.
In June 2018, Bruner filed a lawsuit against Telltale in relation to his departure, citing financial damages as he had been seemingly removed from the Board of Directors, and thus could not gain information related to Telltale's financial status in anticipation of selling off a portion of his shares in the company. Telltale stated the claims were "meritless". In its response to Bruner's lawsuit, Telltale stated that the company "is now working to turn around the decline that it experienced under [Bruner]'s stewardship". Kent Mudle, the creative director for The Walking Dead: The Final Season, stated that the new management had shown a great deal of effort to turn the studio around from the previous uses, with the executives staying more hands-off and reducing the amount of micromanagement of the creative teams.
In June 2018, Telltale announced a partnership with Netflix for the streaming service to provide its games to subscribers, with the first planned game being Minecraft: Story Mode. Alongside this, Telltale announced that it was working on a yet-untitled game based on Netflix's original property, Stranger Things. According to Variety, there had been suggestions of teaming with Netflix for collaboration shortly after Stranger Things first aired in mid-2016, but Telltale's management at the time, including Bruner, rejected the idea. The Netflix partnership solidified after Hawley took over as CEO. The Stranger Things game would have been used to bridge the show's story between its second and third season. In addition to this game, Telltale had started working with Night School Studio in 2017 for them to make a first-person, narrative driven game that would have led into Telltale's game. However, Night School reported difficulty in cooperating with Telltale over 2018 and were also surprised by the studio's sudden closure.
Majority studio closure and aftermath (2018)
On September 21, 2018, CEO Pete Hawley announced that Telltale was undergoing a "majority studio closure", with around 90% of its present workforce (225 to 250 employees) let go that day. A core team of about 25 employees remained to "fulfill the company's obligations to its board and partners", which includes completing the Minecraft: Story Mode interactive media project for Netflix. According to Dan Connors, the studio had been ready to close another round of financing when its last major investor pulled out. The company executives had to make the decision to end all production as soon as possible without this investment. While Connors did not specify which investor pulled out, Variety suggested that this may have been Lionsgate, which had contacted Telltale's board the previous week about its intent to pull out of funding Telltale in order to return to its core film business. Variety also reported that AMC Networks, which owns the rights to The Walking Dead television series, and Smilegate, a Korean mobile games publisher, were looking to invest in Telltale, but both pulled out the day before Telltale's closure announcement. Dan Murray, president of Skybound Interactive which was working with Telltale for The Walking Dead games, said "We knew some of the challenges Telltale was facing, but when the news hits so suddenly everyone was taken off guard", while anonymous Telltale employees stated to The Verge that they had known the company was in financial trouble in the months leading up to the closure and was further hurt by leaks of news related to the Netflix deal, which management wanted to use as a lure for speculative investors.
From Wikipedia’s article on Telltale Games, shared under CC BY-SA 4.0.4