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Obsidian Shifted to Fallout Project While Small Team Keeps Working on Cancelled Avowed 2

Xbox is reallocating Obsidian’s staff to early Fallout development to concentrate resources on larger franchise releases.

Overview

  • Reporting based on Bloomberg coverage says Obsidian has cancelled multiple internal projects and is being reorganized to work on a new Fallout title.
  • Several outlets say a small Obsidian crew is still developing Avowed 2 despite its reported cancellation in hopes of bringing it far enough along to be approved for completion.
  • The Fallout effort is described as very early-stage and is reported to involve veteran designer Josh Sawyer, though specific leadership roles and scope vary across reports.
  • Microsoft and Xbox have not publicly confirmed project cancellations, exact headcount changes, or the reported assignments, leaving the situation fluid and unverified.
  • The moves fit inside Xbox CEO Asha Sharma’s wider reset that has included studio divestments and large job cuts and could speed output for major franchises while raising questions about morale and timelines.