Former South of Midnight Creative Director Questions XBOX Funding After Montréal Studio Goes Independent
By Jon Scarr
David Sears, the former creative director of South of Midnight, has questioned XBOX's approach to funding games like the Montréal-developed adventure. Speaking with MinnMax's Ben Hanson, Sears explained that he appreciated the financial support XBOX provided, but worried that level of spending couldn't continue indefinitely.
When Hanson asked whether he would have stopped that spending himself, even if it meant not funding South of Midnight, Sears replied, “Yeah, probably.” He made it clear that he wanted to make the game, but looking back, he believed XBOX's broader funding approach was unsustainable.
His comments come after XBOX returned Compulsion Games to independent ownership in August as part of its restructuring. Sears had already left the Montréal studio in March 2025, so his comments reflect his experience as a former creative director rather than the studio's current position.
Sears Reflects on XBOX's Game Funding
XBOX was funding games that weren't expected to sell like Call of Duty, and Sears appreciated the chance to make something different. He also wondered how long those investments could continue without the same commercial returns.
When other directors asked whether they were experiencing a golden era, Sears was sceptical. He warned that XBOX could eventually reduce funding, with serious consequences for the studios depending on it.
“I'm not completely selfless,” Sears acknowledged. He knew he had benefited from the funding approach he was now questioning.
South of Midnight is an example of the creative work he was discussing. The 2025 action-adventure follows Hazel through a world inspired by folklore from the American South. Compulsion could tell its own story rather than work on an existing franchise. Her magical Weaving powers let her fight creatures called Haints, whose forms reflect trauma in the story's world.
At the 2026 Canadian Game Awards, Compulsion Games and South of Midnight earned seven awards. Those included Game of the Year and Studio of the Year.
Compulsion Games Returned to Independence in August
XBOX acquired Montréal-based Compulsion Games in 2018 as the studio was preparing to release We Happy Few. South of Midnight followed in April 2025, initially launching on XBOX consoles and PC.
On July 6, 2026, XBOX announced plans to cut approximately 3,200 positions during its 2027 fiscal year. Compulsion and Double Fine Productions would return to management ownership, keeping their intellectual property and game catalogues. XBOX also said both studios would receive funding to support their next games.
On September 22, XBOX's Matt Booty confirmed that Compulsion Games and Double Fine had completed their transitions to independent ownership in August. The announcement didn't specify how much transition funding Compulsion received.
For Compulsion's Montréal team, independence also meant regaining control of Contrast, We Happy Few and South of Midnight. CEO Guillaume Provost told GamesBeat that keeping the team together was his priority during the buyout. Compulsion has since said that sales of its games now directly support the studio and help fund its next project.
Sears wasn't at Compulsion when those decisions were made, but he welcomed the outcome. In the MinnMax interview, he praised XBOX for allowing the studio to continue independently instead of closing it. Sears contrasted that with the 2009 closure of Age of Empires developer Ensemble Studios. He described allowing Compulsion to become independent as a “more humane” approach than what he'd seen during the company's earlier years.
Jon Scarr
Enjoying our coverage? Add 4ScarrsGaming as a Preferred Source on Google.
Comments
Post a Comment
Comments are moderated. Please stay respectful and on topic.