A Kinect-supported game based on Fable will incorporate its ideas, says the same source. Project Milo had already been labelled just a 'tech demo'.
A dozen contractors at the studio have been impacted by this project canning, alleges the rumour although they may also be linked with Fable III's development reaching its end. Earlier in the year Aaron Greenberg said Milo was "not a product we plan to bring to market."
Peter Molyneux showcased an improved version of the Milo & Kate life simulator at the TED conference in Oxford, England. Microsoft has this response to the rumour: "We have no news to share on the Milo front and do not comment on speculation or rumor."
Is this the end already for one of Kinect's flagship projects?