More news on the swiftly unfolding drama surrounding Curt Schilling's beleagured development house 38 Studios: According to Schilling, a sequel to Kingdoms of Amalur: Reckoning was in pre-production, and the State of Rhode Island scared potential investors away from 38 by implying the company was in danger of insolvency. Schilling said that he stands to lose $50 million of his own money.

Schilling says an unnamed video-game publisher pulled out of a $35-million deal to finance the sequel to Kingdoms of Amalur: Reckoning, within three days of governor Lincoln Chafee's press conference about the financial troubles of 38 Studios.

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The soap opera around the seeming death of 38 Studios continues. Get your popcorn ready for this one. Yesterday, liberal website DailyKos posted a story about the death of the studio. It took a political slant, lobbing a bomb at Republican founder of 38 Studios,Curt Schilling with these words:

"So a lesson for future Republican entrepreneurs. If you want to start a business fine. But don't brag about how you'll never need govt help and then put taxpayers on the line for your failure to keep track of your balance books."

• NEWS: 38 Studios Closes Its Door

R. A. Salvatore, the writer of 38's Kingdoms of Amalur, responded  in a comment headed "Your facts are wrong.":

"38 didn't go begging for a handout from Rhode Island...Rhode Island offered to secure a bond for them when the credit crunch reigned, trying to lure them out of Massachusetts."

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A recently unearthed patent filed by Sony may indicate the future of in-game advertising… and the future looks pretty annoying.

The patent, dug up by an intrepid user of the NeoGaf forum, indicates that someone at Sony is at least considering the idea of adding interrupting advertisements to games, so rather than just the occasional out-of-place billboard, games may literally make you wait through a commercial in order to play.

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In a press conference held earlier today in Rhode Island, the governor of the state discussed gaming for a bit. At issue: the fate of now-defunct development house 38 Studios and its subsidiary Big Huge Games. The studio, founded by baseball great Curt Schilling, laid off all of its workers today.

When asked why the company had such disastrous financial trouble, Lincoln Chafee replied: "The game [Kingdoms of Amalur] failed. The game failed." 

Interestingly, Chafee did not confirm the reports of layoffs, saying 38 hasn't told R.I. about them. Chafee also said he doesn't know whether 38 is planning to file for bankruptcy.

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According to a report on The Verge, Curt Schilling's 38 Studios, the company that developed Kingdoms of Amalur: Reckoning. has closed. The company laid off all of its employees, according to a source. Company CEO Jen MacLean and senior vice president of product development, John Blakely, both updated their Linkedin resumes and put 38 in the past tense as well.

MacLean's resume says she left the company in March, but Blakely was with 38 Studios as recently as Monday, when he attended a meeting of the Rhode Island Economic Development Corporation board to discuss the company’s cash crisis with company founder Curt Schilling. He joined 38 Studios in January. Before that, Blakely had worked on DC Universe Online and Everquest 2.

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Diablo 3 players have been reporting that hackers are on the loose left and right, stealing loot, gold and even accounts from unsuspecting victims. Unfortunately, the hacking doesn't come as a surprise to Diablo 3 developer Blizzard Entertainment,  who sent out a press release, saying, "Historically, the release of a new game ... will result in an increase in reports of individual account compromises, and that's exactly what we're seeing now with Diablo 3."

• REVIEW: Diablo 3 Review

They continued, "We know how frustrating it can be to become the victim of account theft, and as always, we're dedicated to doing everything we can to help our players keep their Battle.net accounts safe -- and we appreciate everyone who's doing their part to help protect their accounts as well. You can read about ways to help keep your account secure, along with some of the internal and external measures we have in place to help us achieve our security goals, at our account security website here: www.battle.net/security."

If your account hasn't been hacked yet, do yourself a favor and get a Battle.net Authenticator or a Battle.net Mobile Authenticator. They aren't foolproof, but the devices do make it harder for hackers to access your information. Authenticators are free if you've got a smartphone and if not they're just six dollars on Blizzard's website. You should get one. Also, make sure your e-mail password is different than your password to Diablo 3 (and any other game you need to login to) so that the hackers can't get any extra information from you.

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Curt Schillings' 38 Studios, developers of Kingdoms of Amalur: Reckoning, have reportedly bounced a check for $1.125 million to the state of Rhode Island. The money was meant to payoff the overdue part of a loan given to 38 from the Rhode Island Economic Development Corporation. Earlier in May, the company defaulted on the $75 million loan from RIEDC.

The Office of Governor Lincoln D. Chafee released a statement about the issue reading: "A check from 38 Studios was hand-delivered to the Rhode Island Economic Development Corporation at approximately 5 o'clock this evening [May 17, 2012]. However, upon learning from the Chief Financial Officer of 38 Studios that there were insufficient funds to cover the payment, the check was returned. The EDC remains willing to accept readily available funds."

• REVIEW: Kingdoms of Amalur: Reckoning Review Is At Hand

Additionally, the developer wasn't able to make its payroll this week, leaving at least some of the company's 379 full-time employees without a paycheck. 38 let go all of their temps and contractors, according to Joystiq.

The EDC called a three-hour emergency meeting on May 16, 2012 to determine what they were going to do about the funds. In the end they decided not to take immediate action to help the developer.

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Blizzard has apologized for the spotty launch of Diablo 3. It has also announced it is delaying the launch of the game's real money auction house. It will be open for business later than the originally announced May 22 date.

"We sincerely regret that your crusade to bring down the Lord of Terror was thwarted not by mobs of demons, but by mortal infrastructure," Blizzard said in a post on its forums. "As many of you are aware, technical issues occurring within hours after the game's launch led to players experiencing error messages and difficulty logging in. These issues cropped up again last night for the Americas and Europe servers. Despite very aggressive projections, our preparations for the launch of the game did not go far enough."

Blizzard says it is monitoring Diablo 3 "24/7," and promises it has applied "several optimizations." Right now, the servers seem to be running well.

We don't know when the auction house will open, but Blizzard promises more details soon.

EA has announced that Star Wars: The Old Republic has lost 400,000 subscribers since February 2012, bringing the total active user count to 1.3 million.  Having even 1.3 million subscribers is nothing to scoff at, but it seems as though BioWare wasn't delivering content that people wanted to play fast enough.

• NEWS: Star Wars: The Old Republic Has More Than 1.7 Million Subscribers -- Sales Pass 2 Million Units

However, it seems as if the Star Wars: The Old Republic devs have noticed the issue and are now working harder than ever to come up with brand new content for players. EA revealed that two new content packs, one called Legacy and the other, Allies, will be available for players sometime in the beginning part of the year.

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According to an email reportedly sent from Valve president Gabe Newell, the company won't be announcing anything at E3 2012. The company will be showing off, "Stuff everyone already knows about." So if recent rumblings about a potential Half-Life 3 reveal got you putting on your Hope Shoes, it's time to quietly slip them off.

Here's the full text of the email:

"We are not announcing anything at E3. Really. We are not announcing Half-Life 3 or Portal 3 or Left 4 Dead 3. We are going to be showing stuff everyone already knows about (CS:Go, Dota 2, 10' UI, ...)"

I understand the human capacity for hope, and I hate to crush it, so let me be as generous as possible and suggest that 1) Valve could change its mind between now and then. 2) The email is a fake!  3) Someone will go back in time and change things just enough so that Valve will change their minds. 

I don't think any of these things are likely to happen, but you never know! Keep Hope Alive! The cake isn't a lie!

Valve announcement or not, E3 2012 is going to amazing. I promise. G4 will be all over it, so set your television and internet to go on June 5-7!

Source: ValveTime

The Kickstarter video game you see above is a reportedly a hoax, or a scam, depending on who you ask.

Mythic: The Story of Gods and Man was described as an "action and strategy-based RPG" and was supposedly going to be created by Little Monster Productions, a team of (fictional, no doubt) elite industry veterans, including Activision and Blizzard employees, for a Kickstarted sum of $80,000.

The problem: The artwork for their game had been boosted from outside sources,. the game's poster art was a mash-up Even the photos of the company's offices had been lifted from another site. Internet gaming detectives at Reddit discovered the subterfuge, and when called out on it, the creator of the Kickstarter canceled his project, but not before raising nearly $5,000.

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A particularly nasty and senseless crime went down in Winter Haven, Florida earlier this week. Reportedly, thirty-two year-old Joshua Davis was smoking pot with some college kids (I guess things are like that down in Florida), and he then suddenly gunned down two of them and wounded a third,  all while his young daughter watched.

Beyond his own explanation that he "had a dark feeling," no one really knows why Davis snapped. So why am I talking about it on a video game blog? Because the local authorities in Florida (with the help of the local media) blame the crime (partially) on Davis' love of Battlefield 3.

Police Chief Gary Hester said Davis was addicted to the game and added that he, "told the detectives freely and talked very freely about playing that game on a daily basis and had some real enjoyment playing Battlefield 3."

• VIDEO: Feedback -- Do Games Make You Violent?

Enter the media. Local station WTSP called on psychiatrist Walter Afield for comment, who said, "It makes life and death mean nothing, just a spot on a video screen, you know, this guy comes out and blows these people away and his daughter sees it," he said.

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Dota 2 Dagon and You is the funniest Dota 2 video I've seen all day. It's all about a powerful weapon in Dota 2 called the Dagon, that zaps enemies for a minimum of 400 damage and you can upgrade it so it deals even more. Unfortunately, most players use the item to steal kills from their teammates which normally is frustrating beyond comprehension, but in this context it's absolutely hysterical.

Note: This video contains some NSFW language.
 

Always remember the third step.

The photo above is of a North Korean tractor simulator that I want in my house. It comes from Samjiyon Schoolchildrens' Palace in Samjiyon, North Korea, and the photo was taken by Associated Press photographer David Guttenfelder.  I saw it on Kotaku.

North Korea may succeed at creating awesome, steampunk tractor simulators, but they suck at making rockets. Their recent test firing blew up soon after launch.

I'm fascinated with North Korea's relationship with technology and video games. Like, for instance, take a second to check out this North Korean arcade: It's a chilling vision of what a communist world might look like.

Sony today announced it is axing 10,000 jobs as part of a plan to pull out of a historically dismal financial spiral. The good news for gamers: Sony name-checked its gaming division as a key part of its strategy for recovery.

• NEWS: Sony Predicts Huge Losses

"As CEO, I take this very seriously. But at the same time, it strengthened my resolve to transform Sony," Kaz Hirai told  journalists at a press event. "Employees too want to restore Sony to its former glory and go beyond."

• VIDEO: Sessler's Soapbox: Sony's Financial Troubles

That glory will be restored by the company focusing on the company's electronics division, which included game systems, cameras and phones. Sony will be concentrating investment and technological development in its electronics division.

Personally, I'm curious what Sony's plans are for future handheld gaming systems. I wonder if that entire market isn't going to shrink drastically as smart phones become better and better gaming platforms.

Source: USA Today