Financially troubled publisher Starbreeze Studios has received a major blow: The loss of the rights to Overkill's The Walking Dead, for which it had negotiated to exclusively publish on Windows PCs.

Starbreeze Studios has not been having a good couple of years: After announcing its plans to launch arcade-hall virtual reality facilities and a related multi-million dollar partnership with Acer, cracks began to show in 2017 when the company suddenly backed out of the project. By late 2018 the company was on extreme cost-cutting measures, while in December 2018 the company would oust its chief executive and apply for reconstruction as a last-ditch attempt to avoid insolvency. Since then, the company has cancelled the StarVR developer programme, all-but ensuring that the promised platform will never see the light of day as a commercial venture, and sold the rights to upcoming sci-fi title System Shock 3 back to developer Otherside Entertainment.

The bad news hasn't stopped there, either: Skybound Entertainment, which handles games based on The Walking Dead franchise, has announced that its contract with Starbreeze has been cancelled. 'As of today, we have terminated our contract with Starbreeze Studios and will discontinue all efforts on Overkill's The Walking Dead,' the statement reads. 'Our creators and their stories are the core of Skybound, and since 2014 we have worked hard to expand the world of The Walking Dead into an exceptional Co-op Action FPS. We did our best to work with Starbreeze and resolve many issues that we saw with the game, but ultimately Overkill's The Walking Dead did not meet our standards nor is it the quality that we were promised. We are exceedingly sorry to our fans and share their disappointment in the game. We remain dedicated to providing our fans with the most premium quality content we can offer, and will continue to look for alternative video game options for the IP.'

The move should come as little surprise: Poor sales of the Windows release of Overkill's The Walking Dead were explicitly blamed as a key contributor to missing its 2019 financial targets in the company's November announcement, while the game sits at a woeful 51 Metascore.

Skybound Entertainment's decision extends, the company's statement seemingly confirms, beyond the Windows port of the game: Development on the PlayStation 4 and Xbox One ports, which were to launch earlier this month before being hit with a delay and now-confirmed rumours surrounding their cancellation, also appears to have ceased. Starbreeze, meanwhile, says it is working towards a resolution, claiming that while the game is set to disappear from Valve's Steam distribution platform in the near future it is 'in discussions about the agreement and Starbreeze is trying to resolve the issue to find an amicable solution with the ambition to finish and deliver season 2 of the game, as previously communicated'.

'We are deeply sorry for the issues this may cause anyone who has bought the game looking forward to the resolution of Season 2,' Starbreeze acting chief executive Mikael Nermark claims, 'and are working urgently to attempt to resolve the issue.'

Developer Overkill Software and console-port publisher 505 Games have not yet commented on Skybound's announcement.


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