Contraband Development Paused Amidst Microsoft's Restructuring

The development of 'Contraband,' a smuggling simulation game set in the 1970s, has been put on hold. This announcement comes from Avalanche Studios, the developer collaborating with Xbox Game Studios Publishing on the project. The decision follows a period of significant restructuring within Microsoft, which included substantial workforce reductions and the discontinuation of several other game titles, casting a shadow over the future of various ongoing ventures in the gaming landscape.

Avalanche Studios recently released a statement confirming that active development on 'Contraband' has ceased, indicating that the project's future is currently under evaluation. The studio expressed gratitude for the community's enthusiasm since the game's initial reveal and promised further updates as soon as they become available. Although Avalanche's statement did not explicitly link the pause to Microsoft's actions, reports from reputable news outlets such as Bloomberg and Game File suggest that Xbox initiated the halt. These reports also highlight that Microsoft's publishing division, which oversees collaborations with external studios like Avalanche, was considerably affected by recent layoffs in July.

This situation bears a resemblance to the experience of Romero Games, which, shortly after Microsoft's layoffs became public, announced a loss of funding for a new shooter it was developing. While Romero Games has not officially confirmed Microsoft as the source of the withdrawn funding, the Game File report corroborates this connection. 'Contraband' itself has remained largely out of the spotlight since its unveiling in 2001 at Microsoft's E3 showcase. Official descriptions from Xbox.com vaguely describe it as a 'co-op smuggler's paradise set in the fictional world of 1970s Bayan,' while Avalanche's website confirms its exclusivity to Xbox Series S|X consoles and its planned availability on Xbox Game Pass, Steam, and Windows 10 PC. The original E3 announcement teaser, though short on specifics, effectively conveyed the game's thematic atmosphere.

The suspension of 'Contraband' development adds to a series of challenges faced by Avalanche Studios. Just over a year ago, in June 2024, the company closed its New York and Montreal offices, acquired merely eight months prior, and consequently laid off approximately 50 employees, constituting 9% of its global workforce. This broader trend of project cancellations extends beyond 'Contraband.' Despite Xbox head Phil Spencer's internal memo to employees, assuring them of the gaming business's robust health and unprecedented player engagement, Microsoft's recent cutbacks also led to the cancellation of Rare's anticipated 'Everwild,' the 'Perfect Dark' reboot, and an undisclosed MMO under development at ZeniMax Online Studios, further intensifying concerns within the industry.

The ongoing adjustments within Microsoft's gaming division are significantly reshaping the landscape of game development. The pause in 'Contraband' underscores a period of strategic recalibration for the tech giant, impacting both internal projects and external partnerships, as the company navigates a changing economic climate and re-prioritizes its gaming portfolio.