Microsoft has canceled an unannounced massively multiplayer online game that was in development at ZeniMax Online Studios, the team behind The Elder Scrolls Online. The project had been in pre-production since 2018, with developers spending nearly seven years building a new game engine from scratch and laying groundwork for what insiders described as a “looter shooter” similar to games like Destiny.
The cancellation came as a shock to the development team, who were reportedly preparing to ramp up production. At its peak, around 200 developers were working on the project, with plans to expand further as the game moved into full production. According to sources speaking to IGN, pre-production was progressing well, making the sudden termination all the more surprising.
ZeniMax’s workers’ union publicly criticized Microsoft’s decision, stating that the cancellation had “stolen a future” from the team. The union expressed deep disappointment about the lost opportunity not just for the product itself, but for the developers who had invested years of passion into the project.
The move looks like part of a larger industry pullback from live service and MMO projects. Sony recently canceled several games-as-a-service titles, while Capcom reportedly converted Resident Evil 9 from an online to a single-player experience. These shifts show how the industry is getting more cautious about the high-risk, high-investment nature of online multiplayer games.
ZeniMax Online Studios, acquired by Microsoft in 2021 as part of its $7.5 billion purchase of ZeniMax Media, continues to support The Elder Scrolls Online. The MMO remains popular with regular content updates and a dedicated player base, providing some stability for the studio despite this setback.
Microsoft’s decision shows a strategic shift in how the company manages its game studios. After initially taking a hands-off approach following its major acquisitions, Microsoft seems to be keeping a closer eye on projects with lengthy development cycles or uncertain profitability. The company faces the challenge of balancing creative freedom with financial responsibility across its growing lineup of studios.
MMO development has always been notoriously difficult, expensive, and risky. Success stories like World of Warcraft, Final Fantasy XIV, and The Elder Scrolls Online are rare in a genre full of ambitious failures. With development costs often reaching hundreds of millions and timelines stretching beyond half a decade, the financial stakes make these games especially likely to get canceled.
