Microsoft issued a press release today talking about “some difficult changes.” The publisher has decided to cancel Fable Legends.

“After much consideration we have decided to cease development on Fable Legends, and are in discussions with employees about the proposed closure of Lionhead Studios in the UK. Additionally, we will close Press Play Studios in Denmark, and sunset development on Project Knoxville.

These have been tough decisions and we have not made them lightly, nor are they a reflection on these development teams – we are incredibly fortunate to have the talent, creativity and commitment of the people at these studios. The Lionhead Studios team has delighted millions of fans with the Fable series over the past decade. Press Play imbued the industry with a unique creative spirit behind games like Max: The Curse of Brotherhood and Kalimba, which both captured passionate fans. These changes are taking effect as Microsoft Studios continues to focus its investment and development on the games and franchises that fans find most exciting and want to play.”

Ouch. Rough day for the folks at Lionhead Studios and Press Play Studios. Let’s hope those affected find jobs quickly. Microsoft says they are working with them to find “new opportunities at Xbox” or elsewhere.

You might not recognize Press Play Studios, but you will recognize one of their games – Max: The Curse of Brotherhood.

Max: The Curse of Brotherhood

Their latest game was called Project Knoxville. Check out some early footage of the title below.

The apparent closure of Lionhead Studios is almost unbelievable. The studio has brought us fantastic games including Fable, Black & White and The Movies. Each one brought innovations to the game industry. Lately though, Lionhead hasn’t produced that game fans seem to want. The Fable series continued in a different direction with Fable: The Journey, Fable Heroes and now Fable Legends. All most Fable fans wanted was Fable 4, and instead, we got a Kinect game and an Arcade game.

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This video from Lionhead shows us what Fable Legends was shaping to become before it was cancelled.

What are your favorite memories from Press Play and Lionhead?

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