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Microsoft has spent the previous few years shedding hundreds of staff from its assortment of recreation studios, which ballooned beneath former Xbox CEO Phil Spencer. Now it is set to chop extra jobs and shut extra studios as a part of new CEO Asha Sharma’s “Xbox reset.”
That years-long Xbox cost-cutting marketing campaign has led to extra recreation cancellations than we find out about, ending large tasks that, not less than on the floor, had been thrilling.
Were these “hard decisions” genuinely the pragmatic ones? The 2020s actually have been marked by some large flops, and it is doable that a few of these tasks had been cash pits. A few them had been particularly dangerous propositions: massive, hard-to-make on-line video games.
But as Microsoft doubles down on console exclusives and tries to rush alongside heavy-hitters like The Elder Scrolls 6, I’ve received to surprise if it was clever to toss a lot in-progress work, a few of which was extremely praised internally.
It’s the dangerous video games which might be probably the most thrilling, and whereas Gears of War: E-Day appears spectacular in methods, it isn’t precisely an electrifying proposition this far faraway from the 2010s. Given how worthwhile Microsoft is as an entire—it is making billions even because it dumps cash into AI—was it actually pragmatic to not let a few of its finest cooks cook dinner?
Here are 5 of the large video games Microsoft just lately crossed off the upcoming listing.
‘Odyssey,’ Blizzard’s survival recreation | Cancelled in 2024
We first heard that Blizzard was making a survival recreation in 2022. Codenamed Odyssey, it had been in improvement for nearly 5 years at that time, and Blizzard devs on and off the venture were hyped about it.
Former Blizzard president Mike Ybarra said that he’d “played many hours” of the game and was “incredibly excited about the team’s vision and the brand-new world it presents for players to immerse themselves in together.”
“All I can say is it’s gonna absolutely rock,” said novelist and Blizzard author Christie Golden. “Hella beautiful too. I cannot wait!”
Microsoft acquired Activision Blizzard in 2023 and cancelled Odyssey in 2024. Ybarra left the corporate on the similar time.
According to a Bloomberg report, improvement of Odyssey had began in Unreal Engine, however struggled beneath a mandate to modify to “an internal engine that the company had originally developed for mobile games.” Odyssey was not near launch when it was cancelled, the publication reported.
Maybe it was a basic case of improvement hell, however a survival recreation with Blizzard’s polish, storytelling, and artwork course seems like a good suggestion to me, and in contrast to some genres, co-op survival hasn’t calcified. Even in a fairly unfinished early entry state and after numerous company drama, Subnautica 2 bought over 4 million copies this yr.
Everwild | Cancelled in 2025
We by no means received an entire image of what Everwild was going to be. Rare is finest identified today for Sea of Thieves, through which gamers battle it out on the excessive seas searching for treasure. Everwild, in contrast, gave the impression to be a recreation about being variety to animals.
Everwild had been improvement for a very long time when it was cancelled, and was reportedly rebooted as soon as, which in all probability did not assist persuade Microsoft that it ought to proceed to fund a recreation that contained no exploding barrels or grimacing males.
But the pitch for Sea of Thieves in all probability raised eyebrows, too. An off-the-cuff recreation to play with your folks, however it’s PvP and gamers can grief one another? No development past cosmetics? And you wish to spend how a lot time making the water look superior?
Rare’s creativity shines within the trailer above: I do not know what is going on on with the large amphibian that carries fish (or its younger?) round in its mouth, however the vibe is nice.
Everwild was cancelled in 2025 throughout one in all Microsoft’s mass layoff waves.
Perfect Dark | Cancelled in 2025
The 2025 cuts additionally claimed a reboot of basic Rare first-person shooter Perfect Dark and one of many studios that was making it, The Initiative. (“Several unannounced projects” had been additionally vaporized that day.)
The gameplay video above is the final we noticed of the FPS. An immersive sim-ish shooter marketing campaign with sci-fi devices is probably not a cutting-edge idea in 2026, however you may say the identical about Gears of War: E-Day and the Halo marketing campaign remake. Perfect Dark is a beloved basic, and the response to the gameplay reveal was optimistic.
Take-Two reportedly tried to take the sport off of Microsoft’s arms, however could not attain a deal. The GTA writer clearly believed it had potential, although, as a result of it snatched up the previous leads on the sport to discovered a brand new studio.
Contraband | Cancelled in 2025
Contraband was a collaboration between Microsoft and Just Cause developer Avalanche Studios Group. It was going to be a co-op smuggling recreation set within the ’70s, however Avalanche introduced in 2025 that lively improvement of the sport had ceased. It might theoretically nonetheless occur with out Microsoft, however it would not appear probably.
We by no means discovered a lot about Contraband, which was introduced in 2021 with the gameplay-less teaser above, however an open world co-op crime recreation from the Just Cause developer seems like a very good time.
Project Blackbird | Cancelled in 2025
ZeniMax Online Studios, the developer behind Elder Scrolls Online, had quietly been engaged on a brand new MMO—codenamed Project Blackbird—for over six years earlier than Microsoft cancelled it alongside the opposite video games it tossed out in 2025. Phil Spencer reportedly liked the game a lot, but that wasn’t enough to save it.
ZeniMax Online Studios founder Matt Firor resigned as a result of the cancellation, and said earlier this year that he’d been waiting his entire career to make a game like Project Blackbird. In a separate interview in April, Firor said that Blackbird would’ve been “fantastic” and that Microsoft missed an opportunity by not following through.
The reason it got the axe, Firor says, is that public companies like predictable, consistent revenue growth, and an MMO with lots of front-loaded development costs represents “a very large bet.”
“It’s just: Big business is big business,” he said. “Microsoft is Microsoft, right? And a giant successful videogame on the Microsoft level was frankly not that stimulating to them.”
Some of the laid-off Blackbird team went on to form a new studio with a wry name, Sackbird, and are now at work on a new project.
“After years in AAA, we wanted the freedom to take smart risks without waiting for a greenlight or chasing quarterly targets,” Sackbird COO David Worley said when the studio was announced. “We’re fully employee-owned and funded, which means we only answer to people who are passionate about games.”
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