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Microsoft has canceled further development of Microsoft Flight and "Project Columbia." Flight is the free-to-play "casual" flight simulator for the 360, and Columbia was the unannounced educational game for the Kinect.
While initial reports from employees were that the company had shut down its entire Vancouver Studio, Microsoft has since issued a statement saying it had only let go some employees from the development house.
"Microsoft Studios has decided to end development on Microsoft Flight and Project Columbia. As a result of this action, some positions within the development teams have been eliminated. Microsoft human resources is working with the affected individuals to find new roles within the company. Microsoft Studios is invested in British Columbia and still has several teams, both in Vancouver and Victoria, which will continue to produce the best entertainment and gaming experiences possible."
In case you haven't seen it, check out Flight in action.