Microsoft is restructuring Xbox’s internal studios, moving several developers away from Xbox Game Studios and placing them under Activision, Bethesda or King. The most significant change affects Halo, which is being rebooted under Activision as Halo Studios is effectively dismantled, signalling a major retreat for Xbox’s flagship publishing group.

The changes include Rare and World’s Edge moving to Activision, Obsidian joining Bethesda, Microsoft Casual Games moving to King, and Playground Games merging with Turn 10. Xbox Game Studios has reportedly fallen from 15 studios to just three: The Coalition, inXile and the merged Playground/Turn 10, while layoffs are also affecting its management and central publishing functions. The restructuring appears aimed less at judging individual studios and more at reducing duplication among Microsoft’s publishing operations.