Microsoft to close 'Halo Wars' studio

By Lou Kesten

updated 1:13 p.m. ET Sept. 16, 2008

"Great job, but we're going to have to let you go." It's a sentence too many people have heard over the last few years, but one you might think could be avoided in the booming video-game industry.

It clearly took the people at Ensemble Studios by surprise when Microsoft told them they would be closing up shop once they finish work on the forthcoming "Halo Wars."

(Msnbc is a joint Microsoft - NBC Universal venture.)

"It was certainly a shock to everyone when we found out about the decision," Ensemble chief executive officer Tony Goodman wrote on the company's Web site.

Microsoft described the decision as "fiscally rooted" and said it "does not reflect at all on Ensemble's talent or the quality of `Halo Wars.'" Ensemble's leaders will form a new studio, and Microsoft said it hoped to find jobs for most of Ensemble's employees, either at the new studio or elsewhere within Microsoft.

Still, it's a puzzling development for the developers of "Halo Wars," the first spinoff of the Xbox 360's most successful franchise. ("Halo 3" has sold 8.1 million copies since its release last year.) Ensemble built its reputation on stellar PC strategy games like "Age of Empires," but Microsoft says its closure doesn't mean that it's giving up on that series — or on PC gaming.

"As a company, we're very excited about the future potential for `Age of Empires,'" Kevin Unangst, director of Microsoft's Games for Windows label, told worried fans, "and as a PC gamer I'm looking forward to what that future holds."

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