A reliable source has confirmed to Next-Gen that Microsoft is canceling the superhero MMO Marvel Universe Online.

As Crytpic Studios' development of Marvel Universe ramped up, NCsoft eventually outright bought Cryptic’s original superhero MMO, the NCsoft-published City of Heroes, says our source. Now Microsoft has decided to cancel Marvel Universe, which leaves Cryptic with plenty of time and a nice chunk of change from the City of Heroes sell-off to develop a new IP.

Our source, who wished to remain anonymous, said that an official announcement will be made in a few weeks about the demise of the game, unless something “drastic” occurs.

As part of the NCsoft acquisition of the City of Heroes series, the MMO firm founded a new studio and brought in key Cryptic staffers Brian Clayton, Matt Miller, Aaron Brady and Ken Morse. NCsoft had nothing to do with the actual cancellation of the game, according to our source, but as the firm plans to expand the City of Heroes MMO, it would seem like NCsoft would benefit from not having a high-profile Marvel superhero MMO to compete against.

Rumors of the cancellation originated from a 1Up podcast where EGM executive editor Shane Bettenhausen said that a big-name Microsoft first-party title would be cancelled. Without naming the specific game, Internet denizens speculated if it was Too Human, Fable 2, Halo Wars, Alan Wake or Marvel Universe.

1Up posted a follow-up Tuesday naming Marvel Universe as the game in question.

When asked if it could flatly deny our report, Microsoft told us that it "will not comment on rumors or speculation."

We received no response from Cryptic as of press time.

Via Next-Gen