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Knockout City was shuttered due to inflation, low player retention

Knockout City will officially close in June 2023. Here's what happened.
knockout city game shut down

Knockout City, the ‘dodge-brawling’ online multiplayer game that briefly attracted high praise and an enthusiastic fanbase will shutter on 6 June 2023, after just a short time in the sun. According to Guha Bala, co-founder of developer Velan Studios, the unfortunate outcome was a result of colliding economic factors.

Speaking to, Bala recently dove deep into the final months of Knockout City, and explained how it evolved from a paid live service game, to a free offering that struggled with player retention.

‘We were really thrilled with the initial user base as well as the audience reception,’ Bala said. ‘But by the time we had launched, mid-price premium was pretty uncommon for multiplayer-only titles … it sold fairly well but not well enough, as a mid-price premium title, to continue to support an additional flow of content.’

Read: Knockout City will shut down in June 2023

While its early user base was passionate, trends in the wider games industry reportedly caused Velan Studios to rethink its business model. This led to Knockout City going ‘free-to-play’, with more cosmetic microtransactions added.

With this transition, the team switched focus to attracting a fresh audience to the free-to-play version of Knockout City, with new seasonal content. Briefly, this injected the game with a renewed spark – but by August of 2022, Velan Studios had reportedly noted a ‘dramatic’ drop-off in retention and monetisation.

‘We found that inflation was hitting really hard around the world, especially in East Asia where free-to-play really rules,’ Bala told ‘Inflation and currency devaluation was really crimping on discretionary spend and affecting all games that were free-to-play at the time.’

According to Bala, metrics for retention must naturally rise in times of inflation as the cost to ‘break even’ is subsequently higher. Compounding these requirements was major currency deflation which impacted audiences in Western Europe, and in the US. As inflation rose, many people reduced spending on non-essential items – chiefly, video game microtransactions.

After months of these conditions, with growth slowed and player retention dropping, Velan Studios eventually decided to pull the plug on Knockout City – but not without providing new events and content to reward loyal players who’d stuck with the game. In the coming months, Knockout City will feature a host of new content, with players able to gather new items, and take part in a range of matchups before the final curtain falls.

‘You take your hits and then you move on,’ Bala said of the game’s shuttering. ‘I think it’s important to take stock. The world where everything could be free-to-play and still leave sustainable economics to keep them going, that worldview needs an adjustment.’

Knockout City will close on 6 June 2023. The full report on its final closure is well worth a read.

Leah J. Williams is a gaming and entertainment journalist who's spent years writing about the games industry, her love for The Sims 2 on Nintendo DS and every piece of weird history she knows. You can find her tweeting @legenette most days.