"We have had to change priorities because of requirements on other unannounced projects," Frontier founder David Braben told Rock, Paper, Shotgun. "Some people have been moved, and we are very sad to have made some people redundant."
A mystery source told RPS that Frontier planned to release The Outsider at the end of this year, but a funding deal that was "almost settled" with publisher Electronic Arts ultimately fell through. The site says that 17 staff were reportedly laid off on Wednesday, with another dozen let go at the end of 2010. Braben has told Develop that "There is still publisher interest in the project, and we haven't cancelled it."
The Outsider was announced back in 2005 for Xbox 360 and PlayStation 3, but little has been seen of it since. An espionage-y affair set in Washington D.C., it was touted as having a dynamic world and storyline, leading to a different experience for each player.
Frontier is known to have been working on a new entry in the open-world space sim series Elite--though last year it quietly pulled the game from its "In Development" list--so we dearly hope that one of the "unannounced projects" is that, rather than simply more Kinectimals. Not that there's anything wrong with Kinectimals but, you know, Elite.