Earlier this week, Disney cancelled its popular toys-to-life franchise Disney Infinity and announced that developer Avalanche Software would shut down.

The move was part of a general pull-out from producing its own games, Disney said. Infinity had seemed to be doing well, but the lack of content announced for this year made it somewhat less of a surprise.

But a new report published by Kotaku has detailed mismanagement behind the scenes of the game which caused the profitable project to be canned well before its time.

Disney Infinity was not doing badly - far from it. The original game and its toys raked in more than half a billion dollars. Last autumn, Star Wars figures alone earned around $200m despite increased competition from new toys-to-life launch Lego Dimensions. And yet, for Disney, it still was not enough.

"It's weird to be the number one in a genre but still have your sales be disappointing," one source said. "Disney Infinity was a big seller and earned a lot of revenue for Disney Interactive," added another. "I don't know of another high selling 'AAA' game that has been killed like this."

Infinity had also hit a number of production problems along the road. The franchise's 1.0 figures sold out - which caused Disney to freak out about lost sales - so its 2.0 range was overproduced. 2m Hulk toys were reportedly made. Only 1m were ever sold.

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Stakeholders also interfered, demanding toys to be made of less-popular characters which predictably did not sell as well.

Disney's decision to can the brand means two years worth of unannounced content has now been scrapped.

For example, this autumn would have seen the launch of a Rogue One: A Star Wars Story level pack, developed by British studio Ninja Theory. It is unclear how the cancellation of this will now affect the developer. A new larger, more detailed 12-inch figure line would also have been introduced.

There were even bigger plans for 2017, when a full-blown Disney Infinity 4.0 would finally see release. It would feature a crossover story with Star Wars, Disney and Marvel characters for the first time, with story and characters from upcoming films Cars 3, Star Wars Episode 8, Pirates of the Caribbean: Dead Men Tell No Tales, Coco, Guardians of the Galaxy 2 and Thor: Ragnarok.

It's always sad when projects get canned, but it is especially disappointing to see Disney Infinity end this way when it still had plenty of potential. There's more over at Kotaku.

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Tom Phillips

Tom Phillips

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Tom is Eurogamer's news editor. He writes lots of news, some of the puns and all the stealth Destiny articles.