Source: See below.
What we heard: Whereas the Bungie-developed Halo 3 was the cornerstone of Microsoft's E3 2007 press conference, Halo Wars garnered not even a mention at this year's media gathering, despite being slated for release within the next few months. The game's marked absence highlights the relative media opacity that has surrounded the Xbox 360-exclusive real-time strategy game since it was first unveiled in 2006. The absence of hype for the game is especially curious given that it's being developed by Microsoft's wholly owned Ensemble Studios, the acclaimed outfit behind the Age of Empires franchise.
With Microsoft maintaining its stance of limited visibility for the title, curiosity over the game's particulars has given way to questions of potential quality and inner-studio turmoil. The latter of those questions may have been given an answer today, however. Independent reports from gaming industry news sites Gamasutra and Shacknews indicate that Microsoft plans to shut down Ensemble once development on Halo Wars has wrapped.
According to Gamasutra's sources, Microsoft laid off the majority of Ensemble's staff this morning. Shacknews' sources claim that the layoffs pertained to all persons not directly working on Halo Wars, with those still attached to the project having been offered incentives to stay on and complete the game.
While Microsoft has yet to comment on the reports, it seems highly probable that the publisher has in fact let go a portion of the staff working at Ensemble. However, it remains to be seen whether the staff cuts translate to a full-blown studio closure or are simply a product of the cyclical nature of the gaming industry. In June, similar reports concerning LucasArts and its internal development operations arose, whereby reactionary claims from various sources painted project-end staff reductions as cataclysmic closures. With The Force Unleashed out next week, the publisher has shown no signs of following through in accordance with those initial reports.
It's also worth noting that Microsoft is unlikely to so casually discard a studio that has created one of the best-selling franchises of all time. As per Ensemble's Web site, the Age of Empires brand has sold more than 20 million units since the first installment debuted on the PC in 1997. According to the NPD Group, Age of Empires III for the PC has sold 1.15 million units in the US alone through July 2008, with The Warchiefs expansion tallying nearly 305,000 more. (The second expansion, Asian Dynasties, was developed by Rise of Nations creators Big Huge Games.)
The official story: [UPDATE] Shortly after this article was posted, Microsoft confirmed that Ensemble Studios will be shut down upon the completion of Halo Wars early next year. The publisher noted that the current Ensemble leadership team will form a new studio and will continue to support Halo Wars post-launch, "as well as work on other projects with Microsoft Game Studios."
Bogus or not bogus?: Not bogus.