A new report from Bloomberg has shed light on what's happening at Halo developer 343 Industries, and it sounds like major changes are afoot within regards to the organization of the studio, the types of games it develops, and how it makes them.

　　Starting off, the report said 343 Industries was majorly impacted by Microsoft's recent layoffs, with a reported 95 developers let go. Affected developers included "dozens of veterans," including "top directors," the report said.

　　It was previously reported that 343 might shift away from developing games and instead work with third-party studios on new projects. 343 already said this is not necessarily true, and Xbox boss Matt Booty told Bloomberg that 343 will "continue as the internal developer for Halo and as the home of Halo."

　　The report went on to state that 343's longtime partner, Certain Affinity, is making a new Halo game under the codename Tatanka. It started as a battle royale game and has now shifted in "different directions," the report said.

　　What's more, the report mentioned that 343 is potentially shifting to a new game engine, Epic's Unreal Engine, to make future titles. 343's existing engine, Slipspace, has proved difficult to use, the report said, and these issues have resulted in unannounced Halo Infinite modes like Extraction and Assault taking longer to release than expected.

　　The Tatanka game will be developed using Unreal, the report said, and the use of Epic's engine has made some people inside 343 worried that Halo might no longer "feel" like Halo.

　　Finally, the report said 343 is not planning to release more story content for Halo Infinite. Developers have spent time creating prototypes of new Halo games in the Unreal Engine instead of working on story content for Halo Infinite, the report said.

　　Former 343 designer Patrick Wren said on Twitter recently that the studio suffered from "incompetent leadership up top."

　　The layoffs at 343 shouldn't have happened and Halo Infinite should be in a better state. The reason for both of those things is incompetent leadership up top during Halo Infinite development causing massive stress on those working hard to make Halo the best it can be.

　　— Patrick Wren (@Witdarkstar) January 19, 2023

　　Microsoft Gaming CEO Phil Spencer recently discussed the changes at 343, saying Halo remains "critically important." He also said Halo is not going anywhere, as Microsoft plans to keep making Halo games as long as Xbox exists. Spencer also defended Microsoft's latest layoffs, saying tough decisions are necessary in business.

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