Microsoft was really close to publishing Torchlight. The game was greatly discussed with Microsoft, before Perfect world stepped in to publish the game..
An interview with Kotaku following the closure of the studio, Runic Games’ founder, Travis Baldree, revealed “extensive” conversations were had with Microsoft ahead of the game’s eventual publication in 2009. During that time, Baldree was a key person at Runic Games, working as the company president, as well as lead engineer and game director. While he left the company in 2014, he was more than happy to share about the games’ original development.
According to Baldree:
“we pitched Torchlight to Microsoft and had extensive meetings, a company vetting, and it all seemed to be going so well. To our shock, at the end of the arduous process, they decided they’d rather have us make a Fable game for them.”
Runic declined that offer, and went on to publish Torchlight and its sequel, in 2009 and 2012 respectively.
The games did so well that just before it first shipped, a Microsoft representative came up to Baldree and asked “‘“Why didn’t you come to us to publish this?’”
Runic Games also released Hob back in September, but the studio’s closure was announced just hours after fellow Perfect World studio Motiga.