Microsoft Reportedly Paused Production for Xbox Exclusive Game Contraband

Microsoft has reportedly paused production on Contraband, an Xbox-exclusive game it announced back in June 2021. After Microsoft quietly removed the game’s official trailer from the Xbox YouTube channel a couple of weeks ago, Game File’s Stephen Totilo is reporting today that the game’s development is now “on hold.”

“Microsoft declined to provide a comment on the game’s fate but a source familiar with the matter noted that production—which is now “on hold”—had been ongoing for five years and that the company avoids cancellations as much as possible,” the reporter wrote. Totilo also didn’t manage to get a response from Contraband developer Avalanche Studios, which previously released Just Cause 4 and Rage 2 in 2018 and 2019, respectively.

Back in June 2021, Omar Shakir, the former Game Director for Contraband, described the game as “a co-op smuggler’s paradise set in the fictional world of 1970s Bayan, and our most ambitious and spectacular game to date.” The game was being developed with the “next generation” of Avalanche Studios’s Apex Engine, which powers the destruction and extreme weather effects in Just Cause 4.

In the past four years, Microsoft and Avalanche Studios have not shown anything about Contraband beyond this official reveal trailer from 2021. According to Totilo, the game may have been impacted by recent cuts at Xbox’s publishing division, which oversees the development of Xbox-exclusive games made by third-party developers. “Two Game File sources said that team has been significantly impacted, with multiple producers cut and its longtime leader, Peter Wyse, also exiting the company,” Totilo reported.

Microsoft’s latest round of layoffs hit the company’s gaming division pretty hard, resulting in the cancellation of Rare’s Everwild and the closure of The Initiative, which was working on a Perfect Dark reboot. Microsoft also reportedly shut down the team working on Forza Motorsport at Turn 10 Studios.

In a memo to employees from July, Head of Xbox Game Studios Matt Booty said that Microsoft currently has more than 40 games in development, and that includes games from external studios such as the mysterious “OD” from Hideo Kojima. According to Totilo, “Microsoft is not expected to make any further cuts from its Xbox team due to the Contraband decision.”