Microsoft reportedly pulls plug on follow-up to Rare's 2005 Xbox 360 launch title due to focus on Natal.

Developer Rare is also at work on Project Natal software. Rare's Natal development has apparently come at the expense of a sequel to the Xbox 360 launch title Kameo: Elements of Power. Microsoft ceased Kameo 2 development due to disappointing sales of the critically praised original.
Kameo 2 was taken out of the development pipeline around the time that the publisher restructured Rare earlier this year.

According to the NPD Group, the original Kameo has sold just over 300,000 units in the US since its November 2005 launch despite being offered at a lower price point than normal 360 titles. That figure is markedly lower than even Rare's other launch title, Perfect Dark Zero, which has moved some 655,000 units over the same period of time, according to NPD.

Source: CVG