Microsoft says 'Fable' studio closure was a mistake

Ten years ago, Lionhead Studios was one of the biggest guns in Microsoft's arsenal of first-party studios, but the developer was closed in 2016 after several botched projects. In a new self-produced documentary series chronicling the rise of the Xbox brand, Microsoft freely admits that its handling of the Fable studio was one of its "biggest missteps."

“One of the biggest missteps that we learned from in the past was Lionhead,” said Shannon Loftis, a former Microsoft executive who is interviewed in the documentary. “We had already published Fable 1, and it was a hit, and people loved it…. So we bought Lionhead. Those were good years, the game was great. After Fable 2, Kinect came along, and the Fable-Kinect marriage never really took. And then Fable: The Journey was a passion project for a lot of people, but I think it deviated pretty significantly from the pillars of what made Fable 1 and 2 so popular."

Learning from mistakes — Later in the segment, head of Xbox Phil Spencer discusses the lessons that the company took from the downfall of Lionhead. Spencer states that platform holders should buy studios based on their existing skillset, rather than trying to mold them into arms of the latest company directive, like Kinect. "Your job is to help them accelerate how they do what they do, not them accelerate what you do," Spencer concludes.

While these statements are fairly obvious to anyone who had to sit through the brutal E3 demos of Fable: The Journey, it's relatively rare that you will hear a company as big as Microsoft admit its mistakes in a public form like this. That said, it's cold comfort to the Fable fans who loudly protested the series' change in direction for years prior to the studio's shuttering.

What comes next? — Those fans do have the prospect of Fable 4 to look forward to, since that new entry was announced back in 2020. It's being developed by the Forza Horizon studio, Playground Games, but that's about all we know about it. We do know that Fable 4 will use the Forza engine, though, for whatever that's worth. (Not much, other than it'll probably look beautiful.)