The Last of Us Online: 80% Complete After 7 Years, Game Director Reveals All on Cancellation

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In December 2023, even before any gameplay was revealed, The Last of Us Online was intended to be a central component of Sony’s multiplayer strategy for the PlayStation 5 generation. This ambitious game, designed as a live service within one of PlayStation’s most prominent universes, symbolized the strategic shift initiated by the publisher in the early 2020s. Despite seven years of development (from 2017 to 2023) and an advanced stage of completion (80%), the game was canceled. Vinit Agarwal, former project director at Naughty Dog, recently detailed the long-unclear reasons for this decision in a podcast.

Agarwal explained that the COVID-19 pandemic in 2020 spurred exceptional growth in the video game industry due to increased playtime and spending. Online games became social substitutes, enabling remote interaction. During this period, major players like Sony Interactive Entertainment bolstered their online multiplayer ambitions, making The Last of Us Online a perfect fit. Agarwal stated that the game was nearing completion when Naughty Dog ceased its development in late 2023. He also noted that PlayStation’s push for live-service games began around 2020, coinciding with the start of the pandemic. Internal feedback suggested that the project was progressing rapidly and would be a robust game with strong market potential, according to Agarwal.

However, the situation shifted as health restrictions eased and social life returned to normal from 2022 onward, leading to decreased engagement and revenue for video games. Simultaneously, the global economic slowdown forced companies to reassess spending, ending a period of excessive investment. Consequently, Sony reevaluated its strategy for live-service games. These games involve long-term financial commitments, requiring continuous updates, additional content, and maintenance beyond the initial release. Launching The Last of Us Online would have necessitated sustained resource allocation in an increasingly unfavorable environment. This aligns with Shuhei Yoshida’s previous statements regarding the studio’s involvement. Faced with these constraints, Naughty Dog reached a strategic crossroads: continue developing the multiplayer project or focus on a new solo production, Intergalactic: The Heretic Prophet, which was seen as more aligned with the studio’s core identity. Naughty Dog chose the latter, effectively ending development on The Last of Us Online. The cancellation of live-service projects has led to some independent responses in the gaming community.

The Cancellation of Last of Us Part II Factions Leads to New Japanese-Inspired Multiplayer Game by Agarwal

For example, indie developer Albatross Interactive has announced that they are working on Terminal War, a self-funded 4v4 multiplayer shooter, following the cancellation of The Last of Us Part II Factions. Terminal War is expected to launch on Steam Early Access, though a release date has not been announced. For Agarwal, the cancellation brought both professional and artistic disappointment. After seven years of investment, he learned of the decision only 24 hours before the public announcement. The Last of Us Online was not just a multiplayer extension but also carried an artistic vision rooted in Agarwal’s personal experiences. As a survivor of multiple assaults, he aimed to convey the feelings of fear, vulnerability, and extreme survival within the game. His goal was to create an immersive experience where players would encounter psychological tension amid resource scarcity in a post-apocalyptic world. Following the cancellation, Agarwal founded his own studio in Japan, where he currently resides. He is developing a new multiplayer game that draws artistic inspiration from 1990s Japanese animation and aims to blend Western and Japanese approaches to video game development. We wish him success in this endeavor.

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