Kojima Says Sony Cut Physint Funding in a Zoom Call

Hideo Kojima says Sony cut Physint funding in a June Zoom call, nearly collapsing Kojima Productions before Xbox stepped in.

Kojima Productions is an independent studio that survives project by project, and with only two games in development — OD and Physint — a lost contract threatened the company's very existence. Kojima says his first thought after the news was not anger or sadness, but 'What am I going to do with my studio?' He warned IGN that he feared letting go of the entire Physint team or seeing Kojima Productions collapse because of cashflow problems, noting he had borrowed money from the bank and would be in serious trouble if lenders learned a project had been cancelled. He kept the news from his roughly 200 staff for days, telling only studio president Shinji Hirano and Aki Saito.

Kojima's first thought after the call was protecting his staff of about 200 people, whom he had expanded specifically because of Physint. PC Gamer reports he feared the studio could 'end up collapsing' and had borrowed bank money, worrying lenders would be alarmed if a project was cancelled. He also worried about a repeat of the P.T. situation, since he had already scanned actors for the game, and kept the cancellation from staff until a new partner was secured. Three days after the SIE meeting he told team leaders a new partner was being sought, and no staff left, though some were moved to the OD team.

Rather than pitching Physint as a single game, which he called 'a very old-fashioned way of doing things,' Kojima pitched it as a broad multimedia IP spanning movies, dramas, anime, TV, comics, and music. According to IGN, Xbox boss Asha Sharma's team responded, 'This pitch was fantastic. Never seen a pitch like this!' PC Gamer notes Xbox already had a relationship with Kojima Productions through OD, and could offer technical support, marketing help, and playtesting facilities. Kojima Productions insists the studio is in a healthy, profitable state and that its relationship with PlayStation remains strong despite the switch.

Physint marks the 10th anniversary of Kojima Productions and what Kojima calls the 40th anniversary of his game-making career, and he describes it as the culmination of both. He told IGN he became unwell during the pandemic and began thinking about how much time he had left, deciding to give his all to the project. Kojima also framed the episode as a test of whether independent creators can build lasting studios, saying that if Kojima Productions collapsed it would be a step backwards for indies everywhere. Development never fully stopped: Kojima is still designing the world, game system, scenario, and visuals, while experimenting with enemy AI and new technology, and the engine has not yet been decided as Xbox promises substantial technological support.