The parent company is 'focused on moving ahead' and hiring to fill the vacancies. They are still working on Blade Runner, whose developers just walked out of the door.

IGN's latest report, following the shocking mass resignation of the entire 25-person Annapurna Interactive staff, provides more details on the dispute between the gaming division and its parent company, Annapurna Pictures. Megan Ellison, the billionaire owner of Annapurna Pictures is also mentioned in the report. Anonymous former employees expressed concerns about the Interactive Division's future within Annapurna Pictures and claimed that Megan Ellison refused to work with them to reach an agreement to spin-off the division. Spokespeople from the parent company claimed the division's leader did not respond to their attempts to move the process along.

Annapurna Interactive, a gaming-focused division of Ellison's Annapurna Pictures, was founded in 2016 by veteran gaming talent such as former Sony employees Nathan Gary & Hector Sanchez. Annapurna Pictures, which had produced successful films such as The Master, Her, Zero Dark Thirty, and Zero Dark Thirty, began to struggle with finances in the late 2000s. The Interactive division enjoyed continued success, with games such as Stray, Outer Wilds and Neon White. Gary was named the president of Annapurna Pictures in 2021. However, a source who spoke to IGN claimed that his focus remained firmly on the gaming side.

IGN reports that Ellison, who had remained hands-off for several years after Annapurna's struggles in the late 2010s, initiated a leadership shakeup at the Interactive division in March. There are conflicting reports as to what exactly happened: An anonymous former member claims that Nathan Gary was terminated, while an Annapurna representative says he resigned as a result of other staff changes and his demotion to being the leader of Annapurna as a whole to once again only leading Annapurn Gary and Ellison began to discuss the possibility of spinning off Annapurna Interactive into Verset, a more independent publisher (but still financially linked to Annapurna Pictures).

IGN's source were concerned by some of Ellison’s decisions and changes, even as negotiations progressed. Annapurna Pictures rehired Hector Sanchez, the founding Interactive executive, as "president for interactive and new media". This was independent of, and possibly in competition with, the established Interactive division.

Annapurna Interactive employees claim they were blindsided when Annapurna Pictures signed a publishing agreement with Remedy On Control 2 - a partnership negotiated and arranged by Sanchez - on the same day that the deal was announced publicly. Annapurna spokespeople told IGN that Interactive/Verset was always seen as an indie/AA initiative, and Annapurna Pictures moved into the AAA space under Sanchez's leadership.

IGN's Interactive division sources and Annapurna spokespeople give conflicting accounts about the final breakdown of negotiations. Annapurna claims Nathan Gary did not respond after the company had agreed to outline of a contract earlier this year. "Any implication Annapurna is backtracking on the agreement is false," said a spokesperson for the company. "We signed a termsheet in early April and agreed to high-level terms of the deal. It is therefore surprising that we have not received a response."

IGN's sources dispute this narrative. They claim that Ellison refused negotiations while taking a more active role in managing Annapurna Interactive at that time. They also say that they gave a two-week notice before their mass resignation on September 6, a period of notice that Annapurna didn't seem to use either to negotiate further or to warn its partner developers about the coming disruption.

Blade Runner 2033 Labyrinth, a project that was developed internally, is now in limbo. Annapurna has told IGN that the development of Blade Runner 2033: Labyrinth will continue under a new team, which is presumably made up of all its full-time employees. Annapurna's spokesperson provided the final statement regarding the resignations to IGN:

"The situation is confusing, but we are now focused on moving forward. We've had great conversations with a majority of our current development teams, and we are grateful for their support. Our inbox shows that many developers want to be part of the project. We look forward to hearing their pitches. We've had a flurry of quality job applications and are excited to build an enthusiastic team that is passionate about our mission. P.S. We're hiring."