In 2025, Amazon faces a deep crisis that challenges its hegemony. The obvious signs are mass layoffs what you are facing in the last few days, or the massive crash of your cloud serviceAmazon Web Services (AWS), which globally affected numerous digital platforms. But before, there have been multiple signs, some more subtle than others, that have made it clear that his gigantism was preventing him from precisely combating apparently much weaker rivals. One of its last bosses, Ethan Evans, has made it clear by recounting how Amazon tried to impose itself on the leading digital video game distribution platform, Steam. And despite having many more resources, it failed miserably.
A revealing chapter. The failure of Prime Gaming within Amazon is a revealing chapter, and has been clearly exposed by Ethan Evans, former vice president of Prime Gaming. In a post that shared on his Linkedin profileEvans said that Amazon decidedly opted to compete with Steam, trusting in its size and resources to prevail. However, this strategy not only failed, but also showed a deep disconnection with the ecosystem in which its rival operated. According to Evans, the company tried everything to unseat Steam, from mergers with smaller stores that it intended to grow, to launching its own services such as Luna cloud gaming platform. But it never managed to deliver an experience that was significantly better.
What went wrong. Evans says that one of the critical failures was underestimating the value of Valve, which combined a robust offering with a consolidated community and an interface adapted to the needs of players. Amazon mistakenly believed that its dominant presence and technological infrastructure would be enough, without understanding that players had already solved many of their problems and were unwilling to change. Evans adds to all this problems of focus, frequent changes in direction and the lack of a clear value proposition within a highly segmented and competitive market.
As Evans himself says, there were experts who pointed out that this failure was foreseeable given the saturation and maturity of the digital gaming market, where differentiation requires not only capital, but also an innovative vision and solid relationships with users.
Prime Gaming, in free fall. Prime Gaming is, perhaps, one of the departments of Amazon’s business that is suffering the most. In 3dJuegos they detail a “huge” cut that especially affects its MMO projects. Amazon will carry out a restructuring that will bring with it a very significant number of layoffs, including a total of 14,000 employees, with a direct impact on the Irvine and San Diego studios, which worked on titles such as ‘New World’ and the MMO based on ‘The Lord of the Rings’.
Despite these cuts, Amazon will keep its video game division active, but with a different approach: they will focus on more sustainable products and agreements with third parties instead of continuing with their own big-budget developments. They continue to function as a distributor of the new ‘Tomb Raider’ and the Open world driving game from Maverick Gamessimilar to ‘Forza Horizon 5’. They also have a project from their studio in Montreal, ‘March of Giants’, moving forward with a closed alpha. The official justification for the restructuring is linked to the need to be “more agile” in a context of the explosion of artificial intelligence and changing markets.
Goodbye, ‘New World’. Without a doubt, the project that suffers the most from these changes is ‘New World’, an MMO that will soon be discontinued and whose servers will close sometime in 2026. Season 10 and the latest updates, including the ‘Nighthaven’ expansion, will be the last content that the game will receive. As a way of thanking the community, Amazon made the “Rise of the Angry Earth” expansion free for all PC players, which multiplied users to a very notable but apparently insufficient 40,000 daily players.
Massive restructuring. Amazon is preparing, at all levels, for major structural changes, starting with the massive reduction of its corporate workforce. As has been knownAmazon plans to cut between 14,000 and 30,000 jobs globally. The impact of the layoffs will be especially felt in areas such as human resources, advertising, payments, device development (including Fire TV), customer analytics and Audible. The overcontracting that took place during the pandemic and the need to redirect resources towards strategic areas such as artificial intelligence are presented as some of the reasons in a very complex situation.
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