Layoffs Signal the End
Amazon Games laid off staff across its studios in late October 2025, part of a broader reduction affecting 14,000 positions company-wide. A senior gameplay engineer named Ashleigh Amrine shared details in a LinkedIn post that she later removed. She mentioned losing her role alongside colleagues working on New World and the early-stage Lord of the Rings MMO. Her words painted a picture of a promising game that players would have enjoyed, yet the cuts suggest the project stopped progressing.
Internal communications from Amazon's VP of Audio, Twitch, and Games, Steve Boom, explained the decision to pause much of the first-party AAA development, with a clear focus on MMOs. Studios in Irvine and San Diego felt the impact most. Neither Amazon nor Embracer Group, which holds the Lord of the Rings rights, has issued an official statement confirming the cancellation. Industry sources, however, describe the game as likely finished.
Echoes of a Prior Collapse
This marks the second time Amazon has walked away from a Lord of the Rings MMO. The first effort was announced in September 2018 through a partnership with Leyou Technologies, with Amazon joining as development partner in July 2019. Development continued until 2021, when contractual conflicts arising from Tencent's December 2020 acquisition of Leyou ended the collaboration abruptly, leaving the team to redirect efforts elsewhere, including toward New World.
Both cases highlight how external partnerships can derail ambitious plans. The 2019 project involved the same core group that later built New World. When the deal fell apart, Amazon absorbed the lessons but still pursued another Middle-earth title in 2023 with Embracer. That agreement aimed to cover events from The Hobbit through The Lord of the Rings in a persistent open world.
Standing Stone's Steady Path
In contrast, The Lord of the Rings Online has operated since 2007 under Standing Stone Games. This free-to-play title receives regular updates and retains a dedicated community. Its longevity stems from focused content releases and a smaller operational scale compared to AAA ambitions. Players invest time in a familiar world without needing a new competitor to draw them away.
Amazon's team acknowledged the challenge of standing apart from this established game. Leadership, including VP Christoph Hartmann, stressed the need for a distinct hook in 2024 interviews. They avoided copying existing mechanics and sought fresh systems, but early development stages meant core ideas remained unproven.
Economic Pressures Mount
Developing a massive multiplayer world demands ongoing investment far beyond launch. New World, Amazon's biggest internal success, peaked at over 913,000 concurrent players on Steam in 2021 yet struggled with retention. Approximately $500 million spent across a decade yielded limited returns, pushing the company to reassess high-risk categories.
The wider MMO market favors mobile titles and free-to-play models with cosmetic sales. Console and PC segments see fewer new entries as costs rise and player loyalty centers on proven games. Cross-platform features add complexity without guaranteed payoffs. Amazon's shift prioritizes quicker, lower-cost projects aligned with its streaming strengths.
Alternative Horizons for Middle-Earth
Embracer continues to license the property elsewhere. A third-person action game gains traction with funding from the Abu Dhabi Investment Office, targeting single-player or cooperative play. This approach sidesteps the sustained demands of live-service worlds and appeals to audiences preferring focused narratives.
The cancellation frees resources but underscores consolidation trends. Large publishers increasingly update existing franchises rather than launch untested MMOs. For Tolkien enthusiasts, options persist through ongoing support for The Lord of the Rings Online and emerging titles in different formats.