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Bethesda Says Obsidian's Creative Identity Will Not Change After Xbox Restructuring

Bethesda Says Obsidian's Creative Identity Will Not Change After Xbox Restructuring

In a memo sent to staff, Bethesda president Jill Braff said Obsidian’s creative identity and leadership team would not change.

Written by Manas Mitul | Updated: 24 September 2026 12:18 IST

Bethesda Says Obsidian's Creative Identity Will Not Change After Xbox Restructuring

Photo Credit: Bethesda

Obsidian is confirmed to be working on a new Fallout game

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Highlights

Bethesda president Jill Braff said Obsidian will report to her
Multiple Fallout games are in development
Obsidian Entertainment will continue to work on Grounded

Xbox announced a major shake-up of its game studios on Wednesday as part of its ongoing business reset. Alongside a new round of layoffs at the company, some Xbox studios are being absorbed into other bigger studios. The Outer Wilds 2 developer Obsidian Entertainment, for instance, will operate under Bethesda, Xbox confirmed. Now, Bethesda has said that Obsidian's creative identity will not change as a result of the restructuring.

In a memo sent to staff (seen by IGN), Bethesda president Jill Braff said Obsidian's creative identity would not change, and the studio would continue to be led by chief executive officer Feargus Urquhart and the current leadership team.

“I've had the opportunity to get to know Feargus Urquhart and his team over the past six years, and I have great respect for what they've built. Obsidian has extraordinary creative talent, deep expertise, and a long history of creating memorable games and experiences. I'm looking forward to working more closely with them,” Braff said

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“Today's announcement is primarily a change in reporting structure. The creative identity and strengths that make Obsidian distinct will remain at the core of their studio and work,” she added.

The Bethesda boss confirmed that Obsidian's leadership team would report to her going forward. Bethesda will remain in charge of the Fallout franchise.

“Feargus and the Obsidian leadership team will continue to lead Obsidian, with the studio reporting to me. Bethesda Game Studios will continue to lead the Fallout franchise.

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“Together, the teams will build on their longstanding relationship and the early work already underway on a new Fallout project, with more to share in the months ahead. This structure supports the franchise-led model we've been strengthening while keeping accountability for both the studio and the franchise clear,” Braff said.

Fallout Projects and Bethesda Roadmap

Obsidian Entertainment is confirmed to be working on a new Fallout project in collaboration with Bethesda. The studio is known for developing Fallout: New Vegas, an acclaimed spinoff title loved by the fans of the franchise. Bethesda Game Studios is also working on multiple Fallout games, including remasters of Fallout 3 and Fallout: New Vegas. Additionally, the developer is working on the next Elder Scrolls.

Howdy! https://t.co/YxTuGIzh6G
— Obsidian (@Obsidian) July 17, 2026

Xbox and Bethesda, however, have not shared their plans for the release of these projects. Braff said that the studio restructuring would not impact priorities and roadmaps of teams working on different games.

“I also recognize that employees across our studios, publishing, and business teams will have questions about what this means for our current priorities, roadmap, and responsibilities. To be clear, we're not resetting our roadmap or asking teams to change what they're focused on. We'll take the time to understand how teams can best support one another, and where closer partnership can benefit our players and fans. We'll continue communicating as we progress,” Braff said.

“I'm looking forward to spending more time with the Obsidian team and building on the strong foundation already in place across our organizations.”

In addition to a new Fallout project, Obsidian will continue its work on the Grounded franchise, Xbox said in its announcement this week. Besides Obsidian, first-party Xbox studios like Halo Studios, Playground Games, and Turn 10 Studios, among others, face significant reorganisation.

Halo Studios has been reduced to a small team following the new round of layoffs and will continue to operate as a support studio for Xbox projects. The Halo franchise, meanwhile, has been handed over to Activision. The Call of Duty maker will develop the next Halo title and has begun assembling a dedicated team for the project.

Playground and Turn 10, on the other hand, are merging and will work on Forza and Fable franchises.

Fallout: New Vegas

KEY SPECS
NEWS

Genre RPG

Platform PlayStation 3 (PS3), Xbox 360, PC: Windows

Modes Single-player

Series Fallout

PEGI Rating 18+

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Further reading: Bethesda, Obsidian Entertainment, Xbox, Xbox Layoffs, Xbox Restructuring, Microsoft, Fallout

Manas Mitul

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In his time as a journalist, Manas Mitul has written on a wide spectrum of beats including politics, culture and sports. He enjoys reading, walking around in museums and rewatching films. Talk to Manas about football and tennis, but maybe don’t bring up his video game backlog. More