Turbine already went through a layoff cycle so I doubt they are experiencing great financials. I am sure it can happen, but I've never seen layoffs when a division/group is growing at a good pace and meeting their objectives. Nobody wants to mess with something that is working great.
Consolidating servers can also be done to reduce costs and cost may drive the decision more than what players want. Hardware is clearly better each year and unless the software is a limiting factor, they should be able to consolidate servers to save costs without degrading peformance. If the cost saving is great enough they will even devote development resources to server consolidation to make it happen. It sounds like they already fixed some of the lag issues in U16 and based on the description it sounds more like a client issue vs. a server issue.
We'll see, but I am expecting server consolidation not because of lfms or groups, but due to the usual reason businesses consolidate servers - $$$$$
It's easy to understand, easy to explain, easy to quantify. Someone will pitch it to management and it will eventually happen.
Anyone that has been in management for any length of time understands what this means:
"As part of the continual review of our business operations and fluctuating market conditions, we have had to make reductions in our Turbine workforce," said spokeswoman Remi Sklar in a statement. "The group continues to remain an integral part of Warner Bros. Interactive Entertainment."
fluctuating market conditions = revenue not what we expected (doesn't mean down)
continual review of our business operations = we had to figure out who we can get rid of
The group continues to remain an integral part of Warner Bros. Interactive Entertainment = we want to encourage our best employees to stay because if they leave we are toast.
I feel real bad for the folks that lost their job and wish we the customers bought a bit from Turbine so it didn't happen.