Rumors that publisher Sega has canned Obsidian's long-in-development Aliens RPG have apparently been confirmed by former Obsidian designer David Kondor.
Obsidian's Aliens RPG was first announced way back in 2006, with few updates from the studio or publisher since. Rumors of its cancellation surfaced in early February.
Sega and Obsidian have yet to officially address the rumors, which also specify staff cuts at Obsidian and suggest Sega is "reviewing" Gearbox's cooperative Aliens shooter.
Earlier this year, Sega announced a new Aliens game by Rebellion, Aliens vs. Predator, noting that the new game would arrive before any of the publisher's other Aliens games. However, the Aliens RPG and Aliens: Colonial Marines weren't mentioned by name.
This really sucks but Sega is in the middle of imploding so these things happen. :( I hope Alpha Protocal is ok (there are rumors it will be axed as well) and their third project is well funded.