Sources close to Scottish developer Realtime Worlds have suggested that last month's round of cost-cutting has resulted in the loss of 60 jobs.
GamesIndustry.biz understands that at least two high-profile publishers have turned down the opportunity to partner with Realtime Worlds for the release of Project: MyWorld, and the lay-offs have affected development of the ambitious game.
As a result, the majority of the team is now working on massively multiplayer PC game APB, which received unfavourable reviews on release.
Realtime Worlds has secured multiple investment including rounds of $31 million in 2006 and $50 million in 2008.
A separate report by VG247 has suggested that the company is looking to make more staff cuts to the current APB team.
The board of the company includes GTA creator and MD David Jones, former Capcom and Take-Two exec Gary Dale and Ian Hetherington, who's track record includes selling Psygnosis and Evolution Studios to Sony.
A spokesperson for the company said that today's redundancies only relate to the restructuring announced last month. GamesInudstry.biz is seeking further clarification.
UPDATE: Realtime Worlds has issued the following unattributed statement:
"Further to the press release issued on the 7th July announcing the post-launch restructure for APB and expected redundancies, the 30-day consultation period with the affected staff has ended.
"The supporting infrastructure for a game inevitably changes once released, and those staff that couldn't be redeployed to new projects in the Art, Audio, Coding, Design, Production, and QA departments have regrettably been made redundant.
"APB continues to be our primary development focus, and we remain fully committed to the game and its players."