UPDATE: Sony's Studio Liverpool Drops Projects

UPDATE: Reports from the U.K. say that as much as half of Studio Liverpool's staff could be cut as part of Sony's reorganization of the developer.

A source from the studio has told website Develop that the losses could be very heavy, despite Sony's assurances that some employees would find work on other projects.

ORIGINAL STORY: There is a report out of the UK that Sony is restructuring its Liverpool studio for "project prioritization."

"It has been decided that production on a number of projects within Studio Liverpool will cease immediately due to project prioritization," read a statement posted on UK's Gamesindustry.biz. "Our North West Studio Group has been and will continue to be a vital cog in the WWS [Worldwide Studios] family, with a history of producing genre defining games such as MotorStorm, Wipeout, Formula 1, and WRC and this decision will have no impact of the role that the North West Studio Group will play in the future of all PlayStation platforms."

We contacted Sony of America, but as of the time of this writing it had no comment on the situation.

Unfortunately there is no word as to what games are receiving "prioritization." Although the statement from the studio speaks proudly of the MotorStorm series, it'll be interesting to see if this shakeup changes Sony's future plans for the franchise.