Microsoft Pauses Development of 1970s Smuggling Simulation, Contraband

Avalanche Studios has suspended active development on “Contraband,” a smuggling simulation game set in the 1970s and designed in partnership with Xbox Game Studios Publishing. The announcement comes approximately one month after Microsoft initiated widespread layoffs affecting 9,000 employees and subsequently cancelled several gaming projects, including shuttering The Initiative studio.

In a statement released Tuesday, Avalanche indicated that ongoing collaboration between their studios and Xbox Game Studios Publishing has ceased while the company assesses the game’s viability. They expressed appreciation for community enthusiasm surrounding the project and pledged to provide further updates when available.

While Microsoft has not explicitly linked the development pause directly to the recent restructuring within its gaming division, reporting from Bloomberg suggests that the decision originated with Xbox leadership. Stephen Totilo’s Game File corroborates this account, detailing significant impacts on Xbox’s external publishing arm due to last month’s job cuts and confirming what appears to be a complete halt to Contraband’s production.

The situation mirrors a similar predicament faced by Romero Games, which disclosed shortly after the Microsoft layoffs that funding for an unannounced shooter had been withdrawn. Although Romero has not officially confirmed Microsoft as the source of this lost support, Game File also suggests a connection in that instance. A teaser trailer previously released for Contraband, showcasing its distinct aesthetic, remains accessible despite being removed from the official Xbox YouTube channel.