Contraband cancelled by Microsoft

Contraband, a co-op smuggling game by Avalanche Studios, has been cancelled by Microsoft four years after its reveal.

Contraband cancelled by Microsoft

Contraband was revealed in June 2021 during the Xbox and Bethesda Games Showcase. Four years later, Bloomberg reporter Jason Schreier first reported that Microsoft cancelled the project, and Avalanche Studios confirmed that active development has stopped while they assess the project's future. The studio noted collaboration with Xbox Game Studios Publishing and thanked the community for its initial excitement, promising an update when possible.

The cancellation follows a wave of broader cuts across Microsoft’s studios in June, a move the company tied to its AI-focused strategy. Avalanche’s public statement emphasizes the partnership and ongoing evaluation, but the timing adds to questions about the health of exclusive projects and long lead time titles in the current market. In 2024, more than 100 Avalanche employees unionised, though no layoffs were announced in connection with the Contraband decision. The episode underscores the fragility of big-budget exclusives in a shifting corporate landscape.

The Contraband news highlights how big publisher platforms balance risk and prestige. When a high-profile title disappears from the schedule, it often signals a broader recalibration of a studio network rather than a simple cancellation. For Xbox, the decision comes amid a push to consolidate capital around faster, AI-enabled services and multi-platform opportunities, even as it maintains a portfolio of premium exclusives. For Avalanche, the pause may open space to rethink product scope or partner strategies, especially after unionisation and pressure to improve working conditions. The episode could influence how investors and developers view long-running projects under tight budgets and shifting leadership priorities.

Highlights

The cancellation is not a verdict on Avalanche or Xbox but a signal about the changing economics of big, risky projects.