IO Interactive has officially reclaimed full ownership of its unreleased fantasy game, Project Fantasy, following the end of a financial partnership with Xbox. While this secures the intellectual property for the developer known for Hitman and 007: First Light, the move comes with significant structural changes, including the closure of one of its development studios.
Xbox pulls funding, IO Interactive takes control
Xbox had previously provided external financing for Project Fantasy. However, amid broader restructuring efforts at Microsoft’s gaming division—which include reported layoffs affecting thousands of employees—Xbox withdrew that support. This left the future of the project in limbo until today.
IO Interactive confirmed on X (formerly Twitter) that it has regained full rights to the IP and will now develop and fund the title independently. The studio stated this decision allows them to maintain creative direction and passion for the project without external financial constraints.
Istanbul studio closure impacts 40 employees
To balance its long-term future and focus resources on core internal titles, IO Interactive announced it must close its Istanbul studio. This decision results in the loss of 40 jobs. The company described these moves as “hard, but necessary” to ensure the stability of the broader organization while giving Project Fantasy a solid foundation for independent development.
What this means for you
If you were hoping to see a new fantasy title from IO Interactive in the near future, know that it is still in active development. However, without Xbox’s publishing power or funding, the release timeline may shift as the studio reallocates internal resources. For Windows gamers, this highlights how corporate restructuring at major publishers like Microsoft can directly impact third-party developers and their pipelines.
Source: Windows Central
Over to you: Do you think self-funding gives IO Interactive better creative freedom, or does losing Xbox’s support put Project Fantasy at risk?
