One of the big casualties of Microsoft’s layoffs in 2025 was Project Blackbird, an action-RPG MMO from The Elder Scrolls Online team at ZeniMax. Described as Destiny 2 meets Cyberpunk 2077, the game was reportedly canceled in mid-2025. According to Bloomberg reporter Jason Schreier, it could have been the game to succeed Destiny 2–now that Bungie has wound down development on it–as he believes it could have been a huge hit if it had been released.
In a new video on his YouTube channel, Schreier spoke about the current state of Xbox and how he’d heard nothing but good things about Blackbird. “Destiny just died, and if Xbox had a game like Blackbird ready to go to kind of fill that void that Destiny has left, that could have been a hit. I’ve heard nothing but good things about that game. Granted, a big, very expensive project [that] spent a lot of time in development [and] was having struggles of its own, but everything I’ve heard about that game is so positive. It’s really a shame that it was canceled, I think, because I think it could have helped fill a much-needed gap, for Xbox right now.”
Currently, Xbox’s next big games include Gears of War: E-Day from The Coalition and Clockwork Revolution from InXile Entertainment. Moon Studios CEO Thomas Mahler–who led development on the two Ori games that Xbox published–also recently gave his informed take on Xbox and how the company leans too heavily on legacy IP instead of nurturing the talent needed to create the next generation of blockbusters. “Xbox has struggled for a long time to identify, empower, and protect the key creative people and teams who could have kept the brand at the top,” Mahler wrote in an online post.
As for why Microsoft killed Blackbird? That could be due purely to financial reasons, as Microsoft has focused more than ever on remaining profitable in recent years.
“You could be at the best studio in the world, and decisions happen that impact people. I didn’t agree with what happened, but I understood the reasoning behind it. It is just financial,” former The Elder Scrolls Online director Matt Firor said in a recent interview. “We’re a number on a ledger, and if that number is large, it is ripe for analysis, shall we say, and that number was always large.”
