IO Interactive has regained full ownership of its in-development title Project Fantasy after Xbox withdrew its financial support following a recent corporate reorganization. While the loss of external funding presents significant challenges, the studio affirmed its commitment to independently develop and finance the project moving forward.
This shift places the entire responsibility for Project Fantasy’s progress on IO Interactive’s shoulders, prompting a strategic restructuring to ensure the company’s long-term viability. As part of this adjustment, IO Interactive will focus resources on its core in-house projects rather than pursuing external or derivative initiatives, such as potential mobile adaptations.
One immediate consequence of the funding withdrawal is the closure of IO Interactive’s Istanbul studio. The company confirmed it will begin parting ways with several team members across its operations, describing the decision as necessary to sustain its status as an independent AAA game developer. Despite the workforce reductions, the studio emphasized its ongoing dedication to completing Project Fantasy.
IO Interactive initially announced the loss of funding through a statement on social media, only later confirming Xbox as the backer that ended its support. The gaming press had previously reported on this development, highlighting the volatile nature of industry partnerships and financing. The regained ownership of Project Fantasy grants IO Interactive full control over the intellectual property but also transfers all development costs and risks to the studio itself.
The closure of the Istanbul studio marks a significant contraction for IO Interactive, reflecting broader upheavals within the gaming industry. The company intends to stabilize by concentrating on its primary studios and flagship titles, streamlining operations while maintaining creative independence. Although layoffs are a difficult consequence, IO Interactive’s leadership frames these changes as essential for the studio’s sustainability and to keep Project Fantasy progressing.