What Happened to Subnautica’s Dream Team?
Krafton, the South Korean gaming giant behind PUBG, acquired Unknown Worlds Entertainment in 2021 with high hopes. With the massive success of Subnautica, the studio looked like a safe bet. Krafton paid a staggering $500 million upfront, with an additional $250 million bonus on the line, if Subnautica 2 could hit specific revenue goals by the end of 2025.
Now, the original leadership team, including founder Charlie Cleveland, CEO Ted Gill, and co-founder Max McGuire, has been fired, the game has been delayed to 2026, and that bonus? Possibly gone. Both sides are gearing up for a legal battle.
What went wrong?
Moonbreaker Flopped. That Changed Everything.
Let’s start here: Moonbreaker was supposed to be a success. It had a strong art style, favorable Steam reviews, and the pedigree of Subnautica’s developers behind it. Players didn’t stick around. It never hit 1,000 concurrent players on Steam. The feedback wasn’t toxic. It was apathetic. People wanted to like it. They didn’t. The most recent update? February 2024.
Krafton didn’t just lose money. It is understandable if Krafton lost faith.
After that, it makes sense that Subnautica 2 became a higher-stakes project. When playtesters gave feedback saying it didn’t feel ready, Krafton likely heard alarm bells.
They might’ve thought, “We’re not going through this again.”
Krafton Claims Leadership Went AWOL
Krafton says they fired Cleveland and the others for “abandonment of responsibilities.” The harshest claim? Cleveland was working on a personal film project during the critical development phase of Subnautica 2. After being asked to focus solely on the game following Moonbreaker’s failure.
What’s strange is Cleveland hasn’t denied the film allegation. He has denied the accusation that he abandoned the project, saying the team was actively involved and that Subnautica 2 was ready for early access. But the optics aren’t great. Working (allegedly) on a film while your studio’s last game just flopped and your next game has a $250 million bonus on the line? Even if it’s legal, it raises questions.
What Does “Ready for Early Access” Even Mean?
This might be the most interesting part of the lawsuit: the very definition of “ready.”
Moonbreaker likely seemed ready too. But it didn’t work out. So… who decides what’s “good enough” for an early access release? That’s a murky area. One that gives Krafton legal wiggle room.
According to Krafton, internal feedback on Subnautica 2 pointed to content issues. They said the early access version “falls short in terms of content volume,” and the original leadership’s absence caused “confusion in direction.” They also denied that the delay had anything to do with dodging the bonus payout, though… come on. A 2026 release makes that payout structurally impossible.
Legally speaking, though, if they can justify the delay with feedback and development issues, they might not owe a cent.
The $250 Million Question
It’s not just that Krafton doesn’t want to pay the bonus. They argue that 90% of it was going to go to the same leaders they just fired. If they believe those leaders misrepresented the studio’s trajectory (especially with Moonbreaker), then from their point of view, this isn’t a betrayal. It’s course correction.
Imagine if the court says: “Krafton overpaid because Unknown Worlds oversold Moonbreaker.” That would change how we view the entire acquisition.
This lawsuit isn’t just about Subnautica 2. It could be about whether Krafton paid top-dollar for a studio that couldn’t follow through. If Moonbreaker had succeeded, this story might not exist. But it didn’t, and Krafton seems determined not to let lightning strike twice.
The Fans Are Watching and Picking Sides
Unsurprisingly, the gaming community has largely sided with the original Subnautica team. Players love the franchise and trust the developers who built it. Many see Krafton as the cold, corporate villain ripping creative control away from the people who made the magic happen.
That emotional connection is powerful. But the legal system won’t be swayed by it.
The longer this drags out, the more it risks hurting the Subnautica brand. Delays, leadership changes, lawsuits… these things shake confidence. This industry is full of once-beloved franchises that never recovered from this kind of internal chaos.
So… Did Krafton Overpay?
That could be the heart of this.
At the time, the $500 million price tag made sense. Subnautica was a massive hit, and Moonbreaker looked promising. But hindsight paints a different picture.
- Moonbreaker flopped.
- Subnautica 2 is delayed.
- The leadership team allegedly drifted from development at a critical moment.
Even if the lawsuit sides with the former Unknown Worlds leaders, it’s hard to argue Krafton got what it paid for.
When Trust Breaks, So Does the Business
This isn’t just a cautionary tale for game developers. It’s a reminder that acquisitions, at their core, are built on trust between companies, between teams, and between fans and creators.
Krafton bet big. Unknown Worlds cashed in. Now both are dealing with the fallout.
Hopefully, this doesn’t drag Subnautica down with it. If the courts can’t settle it quickly, we might be looking at another franchise stuck in legal limbo. That would be the biggest loss of all.
