EGM editor Shane Bettenhausen mentioned on last week’s 1UP Yours Podcast that a major Microsoft first-party title had been canceled. This led some people to speculate that the third installment in the Banjo Kazooie series had been canceled.

However, according to Rare, the third entry in the Banjo series is well under development and if rumors about a first-party Microsoft title being canceled are true, it is “definitely not” Banjo Kazooie.

Assuming that there is truth in Shane’s statement, what could this canceled title be? A likely candidate seems to be Microsoft Game Studios’ Marvel Universe MMO. At any rate, I’m relieved to hear that Banjo is still in the pipeline.

Banjo-Kazooie not cancelled, says Rare [GI.biz]

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