Gamasutra is reporting bad news and more bad news for Halo. Since the divorce of Bungie and Microsoft Halo has become the sloppy seconds Ho of a variety of developers.  As such the franchise is floundering along with the Xbox which is now a slashed priced end cap item.

“Following the recent announcement that Microsoft-owned Age Of Empires creator Ensemble Studios would close after the completion of Halo Wars, Gamasutra has discovered that a now-canceled Halo MMO was in development at the studio, unearthing prototype UI and level screenshots of the Ensemble-developed project.

And with Microsoft’s Phil Spencer recently mentioning: “There are more than two or three teams building Halo things right now”, it could be that a Halo title with similarly expansive online options is now being tried at another studio. If so, there has been no public information about it to date.

[UPDATE: The 'Gone Is Gone' weblog has posted a full Flickr gallery of the concept art and UI mockups for the canceled prototype, sourced from the same art portfolio as Gamasutra's original story.]“