The official statement from Disney (which recently acquired LucasFilm and LucasArts) reads as follows:


"After evaluating our position in the games market, we've decided to shift LucasArts from an internal development to a licensing model, minimizing the company's risk while achieving a broader portfolio of quality Star Wars games. As a result of this change, we've had layoffs across the organization. We are incredibly appreciative and proud of the talented teams who have been developing our new titles."

To some the news is not a surprise, as LucasArts had seemed directionless in recent years. The company's core business of games based on the Star Wars license have been largely disappointing in both quality and sales. While the company had some success with games like Star Wars: The Force Unleashed and the Battlefront series, both of those franchises seemed to have died on the vine. The cancellation of Star Wars Battlefront III was particularly ugly, which led to nasty public finger pointing between LucasArts and the developer Free Radical. BioWare developed the MMORPG Star Wars: The Old Republic (which was co-published with EA) had strong reviews but failed to maintain subscribers, and was eventually forced into instituting a free-to-play business model.