007 First Light studio IOI facing layoffs as Xbox pulls funding for Project Fantasy RPG
“What’s changing is where we’re investing.”
Xbox has pulled out of a deal to fund and publish the online fantasy RPG – Project Fantasy – that’s in development at Hitman and 007 First Light developer IO Interactive.
IOI released a statement yesterday evening announcing that “a relationship with an external partner on our own IP, Project Fantasy, has come to an end”. This will result in short-term consequences around “staffing decisions”, the statement added, which we can infer to mean layoffs.
“Project Fantasy is a game, a world, and an IP that we absolutely love and remain 100 percent committed to, now and in the future. This wonderful universe will see the light of day,” the statement concluded.
In a report published at the same time, Bloomberg revealed the external partner to be Microsoft’s Xbox division. A spokesperson for Xbox said the company was “taking a fresh look at where we invest so we’re focusing on our highest priorities”. “We’re not reducing our overall investment in games. We expect to invest about the same in content as we did last year. What’s changing is where we’re investing and the kinds of projects we’re backing.”
Project Fantasy has been in development at IOI for a number of years, having been started post-Covid, in around 2021, and formally announced in 2023. I wrote a story about it recently after visiting an IOI studio and learning that Project Fantasy had the second-largest development team at the company, behind the then approaching 007 First Light but ahead of Hitman. It made it sound as though it was the next game on the studio’s slate.
“Something that IO is well established for is always coming with different game experiences,” chief development officer Véronique Lallier told me at the time, “leveraging technology and everything, and Project Fantasy is a new IP and that’s something we’ve always been very excited about at IO.” The project is being led by IOI co-owner Christian Elverdam.
Microsoft’s move comes as newish Xbox leader Asha Sharma reevaluates and reorganises the company after taking over from Phil Spencer and Sarah Bond earlier in the year. This “reset”, as Sharma’s calling it, is expected to come into full force with imminent layoffs and potentially Xbox studio sell-offs or closures. Just this morning we heard that decorated immersive sim studio Arkane is another of the studio’s apparently at risk. The restructuring is expected to begin 6th July, Bloomberg notes.
It’s an unexpectedly bitter turn of events for a studio riding high after the successful release of James Bond game 007 First Light. We called it a “narrative tour-de-force” in our four-star 007 First Light review, and the game sold close to 3m copies in its first week. The only consolation is that IOI will be pitching Project Fantasy from a position of incredible strength because of this.
Our thoughts are with all of the people affected by this.
Xbox has pulled out of a deal to fund and publish the online fantasy RPG – Project Fantasy – that’s in development at Hitman and 007 First Light developer IO Interactive.
IOI released a statement yesterday evening announcing that “a relationship with an external partner on our own IP, Project Fantasy, has come to an end”. This will result in short-term consequences around “staffing decisions”, the statement added, which we can infer to mean layoffs.
“Project Fantasy is a game, a world, and an IP that we absolutely love and remain 100 percent committed to, now and in the future. This wonderful universe will see the light of day,” the statement concluded.
In a report published at the same time, Bloomberg revealed the external partner to be Microsoft’s Xbox division. A spokesperson for Xbox said the company was “taking a fresh look at where we invest so we’re focusing on our highest priorities”. “We’re not reducing our overall investment in games. We expect to invest about the same in content as we did last year. What’s changing is where we’re investing and the kinds of projects we’re backing.”
Project Fantasy has been in development at IOI for a number of years, having been started post-Covid, in around 2021, and formally announced in 2023. I wrote a story about it recently after visiting an IOI studio and learning that Project Fantasy had the second-largest development team at the company, behind the then approaching 007 First Light but ahead of Hitman. It made it sound as though it was the next game on the studio’s slate.
“Something that IO is well established for is always coming with different game experiences,” chief development officer Véronique Lallier told me at the time, “leveraging technology and everything, and Project Fantasy is a new IP and that’s something we’ve always been very excited about at IO.” The project is being led by IOI co-owner Christian Elverdam.
Microsoft’s move comes as newish Xbox leader Asha Sharma reevaluates and reorganises the company after taking over from Phil Spencer and Sarah Bond earlier in the year. This “reset”, as Sharma’s calling it, is expected to come into full force with imminent layoffs and potentially Xbox studio sell-offs or closures. Just this morning we heard that decorated immersive sim studio Arkane is another of the studio’s apparently at risk. The restructuring is expected to begin 6th July, Bloomberg notes.
It’s an unexpectedly bitter turn of events for a studio riding high after the successful release of James Bond game 007 First Light. We called it a “narrative tour-de-force” in our four-star 007 First Light review, and the game sold close to 3m copies in its first week. The only consolation is that IOI will be pitching Project Fantasy from a position of incredible strength because of this.
Our thoughts are with all of the people affected by this.
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