The layoffs are a result of a reorganization effort for Firefall's future launch.

Red 5 has issued a press release regarding a "reorganization effort" leading up to Firefall's launch. As a result, some layoffs have hit Firefall employees.

Red 5 Studios announced today that the studio is being reorganized prior to the launch of Firefall.

"As Firefall matures, we must transition our priorities and our development strategy to focus on streamlined operations and live product support," said Mark Kern, CEO and founder of Red 5 Studios.

As part of the reorganization, Red 5 Studios confirms that it has released about 10 percent of its staff, the majority from Red 5's video internet entertainment channel, Stage 5 TV. Development of Firefall is unaffected by the reorganization and Open Beta Stage 2 is well underway with a major patch scheduled for later this month.

A Community Manager for Red 5 also confirmed this on the forums:

There was a reorganization of staff (yes, I hate that term too) that ended with some layoffs. The majority of those layoffs coming from our Stage 5 TV crew with a few from the production team. In total, it was a small amount, but no amount of layoffs is ever a desired outcome. This will not affect the continued production of Firefall and we are still hard at work on the next major patch which will hopefully hit PTS this week.

We are still hiring for other positions, including gameplay, server, and web programmers; and a whole team of QA to help make Firefall the best game it can be.

This is never an easy time for a company or those affected by these circumstances. Thank you for understanding our reluctance to go into more details regarding this decision.

Our thoughts go out to the employees and their familiies who have been affected by this development.

Ann "Cyliena" Hosler, Managing Editor

Follow me on Twitter: @Cyliena