Avalanche Studios, Developer of Just Cause, Shuts Down Following Microsoft’s Xbox Game Cancellation

Contraband Development on Hold Amid Avalanche Studios Restructuring

After operating quietly in the background for years, the development of Contraband has recently faced significant setbacks due to strategic cutbacks by Microsoft. In an announcement made in August, it was revealed that Avalanche Studios Group and Xbox Game Studios Publishing would halt active development in order to “evaluate the project’s future, ”raising concerns about the game’s viability.

Studio and Job Cuts Impacting Multiple Locations

As part of these organizational changes, Avalanche Studios has revealed an upcoming closure of its Liverpool office. This decision aligns with broader layoffs affecting their teams in Malmö and Stockholm, intensifying the impact on the company’s workforce.

In a statement on their website, Avalanche Studios addressed these changes, stating, “In light of current challenges to our business and the industry, we have thoroughly reviewed how to best ensure Avalanche Studio Group’s long-term success. This review led us to the difficult conclusion that we must make changes to our staffing and locations.”The company also added that a collective consultation process would be initiated in compliance with UK law, significantly impacting all Liverpool employees. Furthermore, reductions in workforce and team restructuring will also occur in Malmö and Stockholm to meet various project demands.

Concerns Over Job Security and Project Status

Details regarding the number of staff members affected remain undisclosed. Additionally, the current status of Contraband is unclear, as no further information has been released about other ongoing projects at Avalanche Studios.

This marks the second major wave of layoffs and office closures for Avalanche Studios in recent memory. In 2024, the company previously laid off around 50 employees alongside the complete shutdown of its New York and Montreal branches.

Contraband’s Vision and Microsoft’s Broader Impact

Avalanche Studios, known for its work on the Just Cause series, was in the process of developing Contraband utilizing its proprietary Apex Engine. The game was envisioned as a cooperative experience centered around smuggling. Unfortunately, this situation is not an isolated incident; Microsoft has also canceled three other games and shut down one of its studios this year, highlighting a trend of restructuring and project re-evaluation within the gaming industry.

As the gaming landscape continues to evolve, developers and players alike will be closely watching how these changes affect the future of projects like Contraband.

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