‘Batman: Arkham VR’ Sequel Cancelled Amid Meta XR Studio Closures

By
Scott Hayden
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8

Meta’s recent rash of studio closures means that the planned sequel to Batman: Arkham Shadow has also officially been cancelled.

Batman: Arkham Shadow (2024) was developed by Camouflaj, released exclusively on Quest 3 in late 2024, coming just one week after the launch of Meta’s $300 Quest 3S.

Although it was confirmed the sequel was already underway, with Mark Rolston tapped to reprise his role as Commissioner Gordon, the next Batman: Arkham Shadow VR game is now cancelled.

And it’s not due to poor reception of the game—we scored it a solid [8.5/10] in our review—or recent headcount reductions at Camouflaj, which Meta acquired in 2022. It’s due to Meta’s recent closure of Sanzaru Games, developer of Asgard’s Wrath.

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As confirmed by UploadVR, Sanzaru was apparently tasked with production of the Batman: Arkham Shadow sequel. With the broader shakeup at Reality Labs, which saw a reported 10 percent staff layoff, Meta has closed Sanzaru Games along with Armature Studio (Resident Evil 4 VR port) and Twisted Pixel (Deadpool VR).

Additionally, budget cuts reportedly also saw the cancellation of a Harry Potter VR game for Quest, which was supposedly being developed by Skydance Games.

This comes amid a broader shift at Meta’s Reality Labs division, as the company appears to be making a clean break from VR game development and its wider metaverse ambitions as it doubles down on AI and smart glasses production.

Meanwhile, Meta and hardware partner EssilorLuxottica are reportedly upping their target for smart glasses production from 10 million to 20+ million units by the end of this year.

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Scott Hayden
Well before the first modern XR products hit the market, Scott recognized the potential of the technology and set out to understand and document its growth. He has been professionally reporting on the space for nearly a decade as Editor at Road to VR, authoring more than 4,000 articles on the topic. Scott brings that seasoned insight to his reporting from major industry events across the globe.
  • Dragon Marble

    Not surprising after the other closures. Meta has now turned into Valve and Sony, leaving their platform to the indies. I am sure those two are not happy because they must have hoped to ride the wave of Meta investments.

    This is bad for everyone. There is no silver lining. I hear some argue that VR market may "reset and get healthier". No. Stop watering your lawn during dry weather will not somehow spur long-term growth. You personal finance my be healthier, not your lawn.

    Meta's pullback in gaming investments is not the end of VR, but it will not lead to a "more competitive industry". I expect even less competition in the future.

    Those who celebrate Quest's demise is not grasping what is really happening. Quest is fine. It's just drifting further toward Gorilla Tag — which hit new user records the same day the AAA studios closed.

    • Rogue Transfer

      I'm afraid we can't say 'Quest is fine'(*dog-drinking-tea-in-house-fire-meme*). Based on the official revenue Quarterly reports, it's been downhill since 2022. The chances of Meta continuing the Quest line past a possible Quest 4 is slim, simply because the Quest 4 won't be able to gain more users than Quest 3 without first-party developed games launched with it.

      Plus. Quest 3/3S have sold significantly less monthly than Quest 2 did, being mostly only popular for a few weeks of the year around Black Friday. Meta wants user growth and the Quest 4 won't give that without new games made by Meta's studios or others(who are also no longer getting funding from Meta).

      With the ending of Horizon OS partner headsets by Meta from Asus & Lenovo, there's not going to be any way for the Quest-line to continue for long, once Meta pulls the plug on their Quest series. And anyone thinking Meta will remain interested in the Quest series, when the revenue and headset numbers are officially reported by them as trending down is sadly, deluded.

      It's a pity, standalone was just getting to the point where performance could have made for some more reasonable content in general. But, even if Quest 4 offers the specs, the content to support it won't be there, as Meta aren't supporting Quest game content like they did.

      In five years, we'll likely see the sun-setting of the whole Quest platform, if not before. The users & revenue just aren't in it for Meta to continue it, unless Meta is still desperate to keep young people in their platform. The problem is, Quest users aren't being retained as they grow up(since revenue is dropping). They're moving on to better quality games as they grow up – and those aren't on the Quest.

      It really doesn't matter when people celebrate a demise online – the matter is decided by the market. Those people aren't the cause of what's happening, they're too insignificant a factor to affect things like this. They're unimportant, really. Things like this are all down to other more important reasons why the market didn't take off enough for Meta.

      • Dragon Marble

        I thought you were predicting the death of Quest until I got to "in five years". Well, five years is a long time in this industry. Headsets could become so small and widespread that we see a comeback of AAA VR by then.

      • XRC

        Wouldn't be surprised to see it sunsetted within 18 months

        • Dragon Marble

          My prediction is that in 18 months Google and Apple will release their glasses with a huge library of apps, which will render Meta glasses irrelevant, and you will see headlines such as "Meta change strategy again, shifting resources back to metaverse building".

          I have a pair of Meta glasses. But I cannot tell it to "open the map and navigate to the nearest gas station." Think about that. AI is a gimmick if it can't help me with basic things like that.

      • Christian Schildwaechter

        TL;DR: Quest is a valuable XR test platform for whatever platform Meta is now aiming to get with future smartglasses, it makes no sense to shut it down when reducing development costs and increasing the prices to where they no longer lose money will allow to keep their user base, even if the numbers will be much smaller.

        You are assuming that Quest's sole role was to grow a large user base eventually leading to the metaverse/a platform to compete with Apple and Google. That part certainly has failed and Meta will apparently no longer throw lots of money at it trying to still turn it around.

        But the metaverse/a platform to compete with Apple and Google goal isn't really gone, just shifted to smartglasses with a much more mass audience acceptable form factor, but nowhere near as capable as XR HMDs. Quest also serves as the test platform for what smartglasses will be doing in the future. Meta making Mixed Reality their main focus when introducing Quest 3 was not because they hoped that MR games would draw more users, it was to push Quest from a pure gaming device to a more generic one you'd also wear while moving around.

        The tech wasn't really good enough for that, and they then also fumbled the software for things like spatial anchors, but this was already pushing Quest into future smartglasses prototype territory. And this will very likely continue, as smartglasses are many years behind the capabilities of headsets, so it makes sense to continue releasing HMDs for their 10M active user base bought at a very high price.

        Now that their hopes for mass market growth have shifted to smartglasses, Quest headsets will probably also be shifted more towards that prototyping role, with less drive to serve a price sensitive gaming crowd with sales peaking around Christmas. Future Quests will probably be more expensive, mostly based on Qualcomm's reference platform to reduce costs, and introduce features like NPUs that would be more useful for realistic avatars or running local AI than improving games.

        Game development will be completely up to third parties, and higher prices will mean even lower sales, but that's not that big of a problem. The hardware was always only a small part of the money spent at MRL, and reducing Quest to more of a test platform for future XR glasses using readily available components and sold with at least a small margin should be enough to justify keeping it going until Quest can actually be merged into future, much more capable smartglasses. Which probably won't be possible for another 10 years due to significant technical challenges to miniaturize everything down to a glasses form factor.

    • NL_VR

      And a platform for the indies it has always been. The "AAA games" didnt bring in any more people that indies does, maybe fewer even. So there will be no different. i dont mind there will be GorillaTag games, they cant be that many anyway. The best games are still the innovative indie VR-games.

  • It's a pity because the first game was really good