Hideo Kojima expressed genuine bewilderment when Sony apparently placed his upcoming project, Physint, on a list of titles slated for cancellation. In his view, Physint represented "the most commercially viable title I could possibly develop," a statement that underscores both his confidence in the project's market potential and his frustration at the decision.
During an interview with The Washington Post, Kojima explained that the news caught him completely off guard. "We couldn't understand it," he said, referencing the unexpected nature of the announcement. At the time, Sony’s head of PlayStation Studios, Jim Ryan, had already stepped down, which added another layer of uncertainty to the situation.
Kojima believed that the partnership between Sony Interactive Entertainment and his own studio was firmly established and that both parties had agreed to collaborate on Physint as a joint venture. "I was simply shocked and surprised," he recalled.
"I didn't feel anger or sadness, just a practical question: 'What should I do next?'" The gravity of the situation was evident. Kojima admitted that he could not immediately inform his team about the development halt, describing it as a "big problem" for the studio.
On September 10, he publicly disclosed that his studio had "unexpectedly received notice from PlayStation Studios" in mid‑June that funding for Physint would be withdrawn. This withdrawal of financial support threatened the very existence of Kojima Productions, which operates as an independent studio. "If they can't fund us, our studio could collapse," he warned, highlighting the precarious nature of independent game development where financial backing is often the lifeblood of ongoing projects.
Kojima emphasized that many developers who have broken away from larger publishers to form independent studios face significant hurdles in achieving sustainable success. He argued that if his own studio were forced to shut down, it would send a discouraging signal to other indie developers, potentially dissuading them from pursuing independence.
"If my studio closes as well, that's all the more reason for people to not go to independent studios anymore," he said. "I wanted to stand firm for indies, so I needed to find a new partner." The search for a new partner led Kojima Productions to Xbox, which had already been collaborating with the studio on its upcoming horror title, OD.
This partnership proved crucial in stabilizing the studio’s finances and preserving its workforce. Kojima confirmed that the transition to Xbox did not result in layoffs; instead, staff members were reassigned to continue work on OD, while a smaller, dedicated team persisted with Physint’s development under the new publisher’s umbrella.
Sony, for its part, did not publicly provide a detailed rationale for pulling the plug on Physint. However, a Bloomberg report suggested that the project had missed key milestones and was projected to exceed its budget considerably, despite still being years away from a potential release.
Additional sources hinted that the commercial performance of Death Stranding and its sequel fell short of Sony’s expectations, possibly influencing the decision to curtail further investment in Kojima’s new venture. In response to the speculation, Kojima Productions issued a statement cautioning readers to treat the unverified claims with skepticism. "None of the claims written came from any official or on‑the‑record source and as such we encourage you to take them with a dose of scepticism," the studio wrote. It also stressed that the situation, while serious, did not jeopardize the studio’s overall health.
"Make no mistake, this was a serious situation for the studio with a range of potentially significant implications. While we recognise that the article may have caused alarm, we want to reassure you all, for the record: that the studio is in a healthy, profitable state, development for Physint continues to move forward with Xbox, and our relationship with PlayStation remains strong," the statement affirmed.
Kojima reiterated that his relationship with Sony remains amicable, describing corporations as "living things" that experience cycles of change rather than outright conflict. "We're not in a dispute.
We're not fighting with them," he clarified, indicating that while the funding decision was disappointing, it does not constitute a personal feud. Regarding the creative progress of Physint, Kojima disclosed that the narrative and core game concept are fully fleshed out. The studio has begun constructing three‑dimensional models of the characters and is actively testing several game engines to determine the best technical foundation for the experience. He also mentioned that negotiations with the cast, artists, and other collaborators have been successful, with all parties expressing enthusiasm for the project.
"The cast I already talked to and negotiated with, other artists and collaborators who were all happy to do it," he said. Kojima expressed a deep sense of responsibility toward the talent involved, noting that he could not simply inform them that the project had been cancelled, especially after the challenges faced during the development of PT (the infamous PlayStation 5 demo). He did not want to repeat that painful experience by delivering another cancellation notice to the actors and crew.
"I can't tell them this is cancelled, especially after what we went through with PT. I didn't want to go back and do it again and say to the actors this is cancelled," he explained. In summary, while the withdrawal of Sony’s funding presented a significant obstacle, Kojima Productions has navigated the crisis by securing a new partnership with Xbox, preserving its team, and continuing development on Physint. The studio remains financially stable, maintains a cordial relationship with Sony, and is committed to delivering the ambitious title that Kojima believes will become the most successful game he could ever create.