Avalance Studios is set to lay off 77 of its 160 staff after the loss of two contracts that had them making $34 million. Avalanche was the developer of the touted Just Cause and has said this move will only serve to focus their attention on the sequel, Just Cause 2. They will also continue working on The Hunter in conjunction with Emote Games.

CEO Christofer Sundberg doubts they will ever make it back to being a 160-employee company saying, "I love working with these people but I hate growing because it becomes very industrialised and very impersonal. We started this company based on a passion to create games, not to run a huge business."

How'd you like to be in that office? Your CEO just announced that almost half of the company will be gone soon. Probably a fair amount of brown noses walking around the cubicle farm today.

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