Ken Levine announces he is winding down the studio in favor of a smaller endeavor at publisher Take-Two.
Update: Take-Two and 2K have responded with effectively a no comment, pointing everyone to Levine's post on Irrational Games site.
Original Story: In a surprising move, Irrational Games will be closing its doors and laying off staff after the upcoming release of the new BioShock Infinite DLC. Studio Director Ken Levine said only 15 people will be retained for a new project under publisher Take-Two.
In a note to fans, Levine said that he has a new project in mind and needed to start over. "To meet the challenge ahead, I need to refocus my energy on a smaller team with a flatter structure and a more direct relationship with gamers," he said. "In many ways, it will be a return to how we started: a small team making games for the core gaming audience."
Levine said the goal of the new studio will be "to make narrative-driven games for the core gamer that are highly replayable. To foster the most direct relationship with our fans possible, we will focus exclusively on content delivered digitally."
Whatever the new venture will be, it will happen under the Take-Two brand. Levine said he had though about going the start-up route, but the publisher convinced him to keep the new studio in-house. Take-Two will also be available to help those displaced find opportunities within other studios at the publisher.
We've contacted publisher Take-Two for comment and will update as we get more information.
The last DLC for BioShock Infinite is Burial at Sea Episode 2, and is scheduled to be released on march 25 for PlayStation 3, Xbox 360 and PC.
Irrational Games was founded in 1997. It released System Shock 2 in conjunction with Levine's former developer, Looking Glass Studios, two years later. Take-Two acquired the studio in 2006, and was renamed to 2K Boston, where it released BioShock in 2007. It later returned to the Irrational Games name in 2010.
Source: Irrational Games