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Xbox Admits How It Handled Lionhead Was a 'Misstep'

Xbox Admits How It Handled Lionhead Was a 'Misstep' - News

by William D'Angelo , posted on 02 April 2022 / 4,495 Views

Microsoft has been releasing a six-part documentary series and the sixth episode of Power On: The Story of Xbox has one part on the now closed studio, Lionhead Studios.

Lionhead was founded in 1997 and is best known for the Fable and Black & White series. The studio was acquired by Microsoft in 2006 and was shutdown in 2016 following the troubled development of Fable Legends.

The team at Xbox in the segment on Lionhead admitted it was a "misstep" in how it managed the studio. It is something the team learned from. 

Xbox Admits How It Handled Lionhead Was a 'Misstep'

"One of the biggest missteps that we learned from in the past was Lionhead," said Shannon Loftis, who was the General Manager of Global Games Publishing, and transcribed by IGN. "We had already published Fable 1, and it was a hit... People wanted more, and so we bought Lionhead. Those were good years.

"But after Fable 2, Kinect came along and the Fable-Kinect marriage just never really took,” she explained. “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."

Sarah Bond, Head of Game Creator Experiences and Ecosystem at Xbox, added, "We acquired Lionhead in 2006, and shut it down in 2016. A couple of years later we reflected back on that experience. What did we learn, and how do we not repeat our same mistakes?"

Head of Xbox Phil Spencer added, "You acquire a studio for what they’re great at now, and your job is to help them accelerate how they do what they do, not them accelerate what you do."

Xbox Admits How It Handled Lionhead Was a 'Misstep'

The Fable series is making a return, however, this time with Xbox Game Studios' Playground Games. The developer is best known for developing the Forza Horizon series.

The new Fable game is in development for the Xbox Series X|S and PC.


A life-long and avid gamer, William D'Angelo was first introduced to VGChartz in 2007. After years of supporting the site, he was brought on in 2010 as a junior analyst, working his way up to lead analyst in 2012. He has expanded his involvement in the gaming community by producing content on his own YouTube channel and Twitch channel dedicated to gaming Let's Plays and tutorials. You can contact the author at wdangelo@vgchartz.com or on Twitter @TrunksWD.


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28 Comments
scrapking (on 12 December 2021)

Closing Ensemble studios back in 2008/9 should have taught them the same lesson. They were the "RTS" studio behind Age of Empires and Age of Mythology. Their last game was Halo Wars, which went on to sell well, get decent reviews, and be deemed worthy of both a "Definitive Edition" and a sequel. But despite their success, they were closed citing the declining popularity of RTS games at the time.

Ensemble periodically approached Microsoft with ideas of other genres/gameplay mechanics that they wanted to explore. They were told no, you're the RTS studio. But then they were closed, because RTS games weren't popular enough to justify keeping the studio around.

Foolish on Microsoft's part back then, and thankfully it probably wouldn't play out like that today.

  • +5
Farmageddon scrapking (on 12 December 2021)

I'm curious about the downvotes

  • +1
scrapking Farmageddon (on 12 December 2021)

I've given up trying to understand what earns downvotes on VGChartz, to be honest. :)

  • +2
ireadtabloids scrapking (on 13 December 2021)

That ensemble closure hurt a lot at the time.

  • +2
Azzanation scrapking (on 13 December 2021)

From what iv read. They closed Esemble down and moved the employees to other devisions. I believe the main reason was the lack of games they were making and probably leeching the company for years. Normally when thats the case they get closed down, much like Lionhead.

  • 0
scrapking Azzanation (on 14 December 2021)

But Ensemble wanted to make other games, and weren't given the opportunity because they were myopically seen as the "RTS studio". That unwillingness to let them attempt to branch out, even in the face of closing them otherwise, seems like an unacceptable lack of vision IMO.

  • 0
Azzanation scrapking (on 15 December 2021)

The issue was thier strenght was RTS games and that Genre was on a massive decline. I agree they shouldnt have closed them but keeping them open might of been a bigger expense and risk. Thier is more to a buisness than just keeping something open and letting them do as they please.

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scrapking Azzanation (on 15 December 2021)

Oh, I run a business with 12 staff of varying disciplines, I get it. Sometimes you have to make hard calls. But it sounds like Microsoft closed Ensemble because RTS was in decline, while simultaneously failing to give serious consideration to any of Ensemble's suggestions about ways they wished to branch out. That's the unfortunate part of the closure, and that's the part that I think would be handled differently today.

  • +1
Azzanation scrapking (on 16 December 2021)

Most likely MS have lifted some of thier rules today and are more for risk taking and chances however if a studio is leeching money and its cheaper to just reach out to studios for hire, example Relic for AOE4 than i can see why they made that call.

  • 0
aTokenYeti (on 12 December 2021)

I wonder if Lionhead would still be around today if Peter Moluneux wasn’t such a headcase. He was a huge part of the reason they pivoted so hard to Kinect, and when he left the studio was basically rudderless.

Ultimately Microsoft should have recognized the limitations of Kinect earlier and not gone all in with it, but a more grounded studio director with Moluneux’s cache could have navigated Lionhead through those rough times.

  • +4
Pemalite (on 12 December 2021)

The entire gaming community screaming out should have been enough of a reason not to shuttle the studio.

Fable 1 was a masterpiece at the time, Fable 2 was absolutely amazing.
Fable 3 whilst "okay" and enjoyable for what it was... Felt woefully incomplete due to the time skip.

Lionhead had some great games under the belt that would have been perfect for Kinect too... Black and White for example? That game already supported the glove controller on PC, but Kinect would have made that accessory redundant.. And you could have augmented the control scheme with voice controls.

Microsoft miss-managed the studio since it's very purchase. Moleneux's dramatics didn't help either.

  • +1
Libara Pemalite (on 12 December 2021)

I briefly worked at Lionhead and the reverance Molyneux had at the studio, at least I feel was perhaps part of the reason it was shut down. People were afraid to say no to his ideas. The other reason obviously being MS not knowing how to handle that type of studio.

  • +4
method114 Pemalite (on 13 December 2021)

Fable 1 truly was an amazing game. I hope they can get back to that level of quality with the fable series.

  • 0
KratosLives (on 13 December 2021)

How does a driving game developer go on to work on fable? Wtf?

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Azzanation KratosLives (on 16 December 2021)

They have the tech to make it, however they are also outsourcing devs to help with the project.

  • 0
KratosLives Azzanation (on 16 December 2021)

So best to go in with low expectations .

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Azzanation KratosLives (on 16 December 2021)

Should never have high expectations for any game, especially if a dev is new at the genre. Sometimes it isn't easy. I am guilty for getting overhyped for some games.

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Mr Puggsly (on 12 December 2021)

I honestly didn't care. I figured the plan was to give it to another studio, maybe Rare. At that point we had already seen IPs move to new studios.

As much as I enjoyed Fable games, it felt like the genre changed a lot and Fable would need to become something different, more ambitious. And I had little faith in Lionhead. Especially after the Fable Legends beta.

  • 0
pokoko Mr Puggsly (on 12 December 2021)

Fable Legends is part of what this is all about. That was a Microsoft game, they were pushing GaaS and free-to-play and dictating to Lionhead what kind of games to make, despite Lionhead having no experience in those areas and no desire to go in that direction.

  • +7
Azzanation pokoko (on 13 December 2021)

How many GaaS and FTP games have MS released? I can only think of 1, and thats Sea of Thieves, which is an incredible game and isn't free.

  • 0
pokoko Azzanation (on 13 December 2021)

Which has what to do with what they told Lionhead? “Fable Legends got concepted then greenlit in around July-August 2012 time,” says Stuart Whyte. “I wasn’t there at that point, but certainly talking to the studio head Mark Webley they tried to pitch Fable 4 and were very much told that if it isn’t GaaS [games-as-a-service] it isn’t gonna fly – we need to pivot to support that.” https://www.theguardian.com/technology/2016/may/20/lionhead-the-rise-and-fall-of-a-british-video-game-legend

“I thought I was going to be working on a single-player game, a more advanced version of Fable 3,” says one source. “But when they went to get that game approved, the three senior designers who were pitching it were told that ‘you will not be given permission to make Fable 4, or something that is a shadow Fable 4’. Phil Harrison’s vision for all of his studios in Europe was now for service-based games. That’s what he thought was the future of games. He didn’t want to make anything that was a £50 box, fire and forget. He wanted long tails of revenue, even if there was a smaller up-front burst of revenue.” https://www.reddit.com/r/Games/comments/4nbcx3/how_fable_legends_took_down_lionhead/

  • +3
Azzanation pokoko (on 13 December 2021)

Its odd since MS has only released one GaaS game (SoTs) and one FTP (Halo Infinite) I actually don't blame MS for pushing Fable as a GaaS game, if what is said true. Its a great idea when you think about it. Fable was on a heavy decline and MMO culture was massive. Playing a online Fable game should have been considered and would have fitted the IP. They should have done it.

  • -8
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Azzanation ClassicGamingWizzz (on 13 December 2021)

Speak for yourself. Look how well it turned out for Lionhead when they didn't go down that path. Fable 3, Journey, Legends anyone?

  • 0
Mr Puggsly pokoko (on 13 December 2021)

I think the idea of the game was bad in general. They should have just made a Phantasm Star Online clone or third person dungeon crawler like Diablo.

Maybe Lionhead was trying to be innovative but it was just a bad game. Not sure who is to blame, but Lionhead was making disappointing releases prior to that.

  • 0
DonFerrari (on 13 December 2021)

For sure it was a misstep, both studio and franchise were well liked by the fanbase, let`s hope they truly learned from all their mistakes until about half of past gen at least.

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