If I remember correctly, Jez said that Microsoft thought the value proposition just wasn't there. They gave it three seasons to try to pick up some momentum and (at least from what he'd heard), the value just wasn't there.
Yep.
That's what they originally said. However, it seems things might have shifted lately. It is just insane not to continue KI.
Even Sony has an "exclusive" fighting game with SF5 and all its updates. The fighting community grew exceptionally this generation with PS4. That's another losing battle for MS.
MS owns its own exclusive fighting franchise, and they won't do anything with it? If that was true, for all the right moves MS is making for next generation, this is not a healthy move.
With Gamepass, games like KI will always have a steady flow of users throughout time. They just need to give it a steady budget, and you will see many buying Scarlett just for KI follow up.
Ironic, seeing as I personally know many including myself that got the Xbox One just for KI.