Microsoft has stopped development on Contraband, a cooperative action-adventure game created by Avalanche Studios for Xbox Game Studios Publishing. The title was announced during the 2021 E3 showcase and described as a “co-op smuggler’s paradise” set in the fictional 1970s world of Bayan. Since its initial reveal, the project saw little public progress, with no gameplay footage or substantial updates released.
After four years in production, Microsoft and Avalanche confirmed that work on the game has been halted while the companies evaluate its future. Although neither party used the term “cancelled,” industry analysts and gaming media have reported the decision as effectively ending the project.
The development stop comes during a period of significant changes in Microsoft’s gaming division. In July, the company cut approximately 9,000 jobs across Xbox Game Studios, Bethesda, and other teams under the Microsoft Gaming umbrella. Several other high-profile titles were also scrapped during this restructuring, including Rare’s Everwild and the reboot of Perfect Dark from The Initiative. These moves follow earlier reports of tighter budget oversight and shifting priorities within Xbox’s internal studios.
Reports from industry outlets say that Contraband experienced a long stretch of silence following its announcement, leading to speculation about development challenges. Avalanche Studios, known for the Just Cause franchise and Mad Max, acknowledged the pause in production and thanked fans for their interest. The studio indicated it is still assessing whether the project will continue in some form.
The cancellation has sparked mixed reactions from the gaming community. Some players expressed disappointment over losing a potentially unique co-op experience, while others said the game’s disappearance from the public eye made the decision unsurprising. Without gameplay reveals, trailers, or concrete release timelines, enthusiasm for Contraband had waned over time.
Xbox leadership has maintained that the company remains committed to delivering a strong lineup of games despite the recent wave of cancellations. Xbox head Phil Spencer has stated that the platform’s upcoming releases and hardware offerings will provide value to players and keep the brand competitive in the market. However, with Contraband joining other abandoned projects, questions about Microsoft’s long-term content strategy continue to grow among fans and industry observers.
For Avalanche, the halt on Contraband raises uncertainty about its collaboration with Xbox Game Studios Publishing. The developer continues to work on other projects but has not indicated when or if Contraband might resurface. For now, the game remains one of several ambitious Xbox titles announced in recent years that failed to reach release.
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