Disney has laid off the staff of LucasArts and cancelled all current projects.
Staff were informed of the shutdown this morning, according to a reliable Kotaku source. Some 150 people were laid off, and both of the studio's current projects—Star Wars: First Assault and Star Wars 1313—were cancelled. Disney will still use the LucasArts name to license games, but the studio is no more.
Publicly, Disney is saying their current games could be licensed out to a different publisher or developer, but according to our source, that's unlikely. Our source says Lucas has pursued the option for "one or both games," but nothing happened. "With the teams now basically being dispersed I think both games are effectively dead forever," our source said.
A second source also told Kotaku this afternoon that the chances of Lucas licensing out 1313 are very slim. The odds are "effectively zero," the source said.
“After evaluating our position in the games market, we’ve decided to shift LucasArts from an internal development to a licensing model, minimizing the company’s risk while achieving a broader portfolio of quality Star Wars games," LucasArts parent company LucasFilm said in a statement. "As a result of this change, we’ve had layoffs across the organization. We are incredibly appreciative and proud of the talented teams who have been developing our new titles.”
UPDATE: We've learned some more about the now-cancelled Star Wars 1313.
This comes after weeks and months of rumors involving the studio, which was acquired by Disney last fall. In September, LucasArts put a freeze on all hiring and product announcements, which many staff saw as the beginning of the end. In February, we started hearing rumors that the studio might be shuttered. Today, it's official: the iconic development house is gone.
The company was acquired as part of a mega-merger last year where Disney acquired LucasFilm and its sibling company from Lucas. Maniac Mansion, one of LucasArts' first self-published titles, introduced the "SCUMM" game engine driving several well known point-and-click adventure titles the company published throughout the 1990s. The Secret of Monkey Island, created by Ron Gilbert and co-written by Double Fine's Tim Schafer, is one of the publisher's best-known graphical adventures using the engine.
The publisher's apogee was certainly in the 1990s, when a wave of Star Wars-themed titles for the PC—such as Dark Forces, X-Wing and Rebel Assault—were supplemented by games like the strategy title Afterlife, the Sam & Max series, and Schafer's Full Throttle.
In the 2000s, the company became more reliant on its Star Wars products and licenses sold to other developers as new efforts like Fracture failed to take hold. The decade's most notable successes—Star Wars: Knights of the Old Republic and Star Wars: Battlefront—were both externally developed, by BioWare and Pandemic Studios, respectively. LucasArts' last title to see mainstream success was 2008's Star Wars: The Force Unleashed. A 2010 sequel didn't live up to expectations. The last game published by LucasArts was Kinect Star Wars for the Xbox 360 last year, a game widely panned by critics.