Things are getting dicey for Microsoft Studios in both the UK and Denmark.

Microsoft has announced that Fable Legends is now officially cancelled, and there’s even an ongoing discussion about possibly shutting down Lionhead Studios– which Peter Molyneux co-founded. Our thoughts are with the staff.

This studio has produced some memorable titles over the years like Fable and Black & White, so the developer will surely be missed. The news comes as a shock since Fable Legends has actually been in closed Beta for quite some time now, and an open Beta was supposedly coming in the near future.

Unfortunately, there are more casualties. Press Play Studios, which is located in Denmark, will also be closed, and development on Project Knoxville has also ceased.

This news at least makes you wonder what state Fable Legends was in since Microsoft obviously thought it would be better to just shut down the whole project after so much development time, rather than show it to the world. The feedback they were getting must have been discouraging.

Microsoft is reassuring everyone that they’re still committed to the development communities located in the UK and Europe, so there’s that. The publisher/developer has also stated they’re working with the employees that have been affected to try and find them another gig within Microsoft or somewhere else still in the video game industry. Hopefully, it’s not just empty rhetoric.

Were you guys looking forward to Legends? Does this come as a surprise to you? What’s your favorite Lionhead game? Let us know in the comments below!

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HT: Xbox

Image: Microsoft