The layoffs at Microsoft also affect the developers at Zenimax Online Studios, known primarily for Elder Scrolls Online. Their new MMORPG is said to have been halted after 7 years in development.
What kind of MMORPG is this? Little has been known about the new MMORPG from the makers of Elder Scrolls so far. Under the codename “Blackbird”, the studio worked on a new MMORPG alongside Elder Scrolls Online. Development is believed to have started back in 2018.
Job postings over the years indicated that the developers wanted to create their own engine for the MMORPG and that it was intended to be an AAA project (via zenimaxonline.com).
However, there was never any precise information about the setting or specifics such as classes, structure, or even dungeons and raids, and that is not likely to change now.
With this trailer, the developers of Elder Scrolls Online surprised their fans:
End of the ambitious project
Why did the project fail? Microsoft announced many layoffs on July 2, 2025. Industry insider Jason Schreier reported on BlueSky that due to the changes at Microsoft, the new MMORPG from the ESO developers has also been shelved.
Currently, the employees don’t even seem to know if they still have a job. Jason Schreier reported on BlueSky that the employees at Zenimax Online Studios were locked out of their Slack accounts, but so far know nothing more specific: “[…] No message from HR, no word about whether they still have a job, just an ominous Slack deactivation.”
Why did the layoffs happen? Microsoft announced 9,000 layoffs all at once. These affect many different studios, teams, and projects. The fact that it includes a AAA MMORPG from the West is particularly bitter for fans of the genre, especially since most titles in this space now come from Asia.
Adam407 also reacted on Bluesky: “Shutting down a game that was in development for SEVEN years is madness. I honestly wonder how close it was to release. It’s crazy that it hasn’t even been revealed after such a long time. I honestly can’t imagine working on something for so long, only for it to amount to nothing. I feel for the team.”
While development on the new MMORPG is halted, things are heating up for Elder Scrolls Online this year. The new season system is set to refresh the usual update cycle. Additionally, there’s currently something for free that players previously had to pay for: An essential system from the MMORPG of Elder Scrolls, which you previously had to pay for, will soon be available for free
