As first reported by Kotaku.com:

Sony Online Entertainment, makers of D.C. Universe Online and Free Realms, closed three studios and will lay off nearly a third of its workforce, Kotaku has learned.

Word began spreading when George Broussard, best known as the co-creator of Duke Nukem Forever, tweeted earlier this evening that SOE was seeing layoffs and “studio closure is possible.” Kotaku has confirmed through a source familiar with the matter that the closures affect SOE’s studios in Seattle, Tucson, Ariz. and Denver. Half of the workforce at SOE offices in Austin, Texas were pink slipped along with a sizeable portion of San Diego. In sum, it accounts for nearly one-third of SOE’s manpower before today.

Kotaku has reached out to Sony Online Entertainment for official comment.

Sony’s MMO Makers Close Three Studios, Lay Off One-Third of Workforce @ Kotaku

With the faltering FreeRealms now a huge drag on the SOE profit-and-loss report, and no sign of The Agency, a lot rests on EverQuest 2, DC Universe Online, and a growing gaggle of Facebook games. I wouldn’t be surprised if EQNext make a big splash at Fan Faire.

UPDATE: Kotaku has a second source confirming this news.

UPDATE: Sites around the web carrying this article:

• SOE to close The Agency studio | Massively
• Doomsday for Sony Online Entertainment — PC World
• Joystiq – Report: Three SOE Studios Close, Layoffs Abound

Notably, SOE Seattle has been the lead development studio of The Agency, which had been slated to launch in the second half of the year (after a long delay). Neither SOE Denver nor Tucson has been working on anything as high profile as The Agency, though both have continued to operate a number of SOE titles, including Denver’s Legends Of Norrath and other digital card games, and Tucson’s PoxNora strategy game.

CORRECTION: Ikik is still on the Vanguard team.

Today we learn from EQ2Flames just who was laid off from the EQ2 team. Timetravelling designed some of the more interesting raid encounters in the Sentinel’s Fate expansion, including Roehn Theer:

I wanted to pop in and thank you all for playing EQ2 for the last few years.

You helped make it an absolute joy of a job, and I’m sorry to be moving on, but I suppose that thems the breaks.

Please keep on keepin’ on, having fun, and kicking the crap out of all of the encounters us poor Content designers create for you.

Hopefully y’all enjoyed some of everything I’ve worked on over the last few years as much as I thoroughly enjoyed the opportunity to create it for you.

And good luck with Roehn Theer…Slackers! =)

Brett – Timetravelling

Also, Saavedra, EQ2 designer from 2004-2008 and who had been working on other SOE projects also posted:

Guess I can post on flames now eh? Yeah, I am currently LFW

Vanguard

Also, if you have had any optimism for the future of Vanguard, they lost Wigin, as well as their Community Manager Raijinn. “On life support” would be a charitable way to describe the situation at this point.

Marketing?

Sources tell us that Marketing lost 2 team members during this layoff.

I guess now we know how SOE paid for those new Oracle 11G servers for EQ2.

UPDATE: We heard about layoffs today, but linked to (and quoted) the 2009 article. Here is the correct link and quote:

From IndustryGamers.com:

The developer behind DC Universe Online and The Agency, Sony Online Entertainment, has laid off 35 employees, or just over 4% of its full-time workforce, in an effort to “better align the company’s resources…as well as improve operational efficiency,” says SOE’s Scott Gulbransen, senior director of global PR & corporate communications.

The official statement: “In a move to better align the company’s resources against areas of growth that meet consumer demand in today’s online market as well as improve operational efficiency, Sony Online Entertainment has eliminated just over 4% of its full-time workforce, equaling 35 people. The changes will better position SOE to deliver against its emphasis on developing games for a wider, more diverse audience and remaining a worldwide leader in online gaming.”

These layoffs are almost exactly one year after the company announced layoffs of 41 employees on July 17, 2009.