Microsoft was working on a project that would have allowed PC and Xbox gamers to compete in the same multiplayer matches, but according to Rahul Sood, founder of VoodooPC and CTO of HP's VoodooPC subsidiary, the plan turned out to be a disaster because console players were no match for PC gamers with keyboard and mouse. The exact reasons why Microsoft cancelled the cross-platform gaming project are unknown, but the fact that mediocre PC gamers managed to slaughter the best console gamers every time was likely one of the main reasons.
There was a project that got killed at Microsoft. This project was designed to allow console gamers and PC gamers to interact and battle over a connected environment. Personally I wish it would have stayed the course. I've heard from reliable sources that during the development they brought together the best console gamers to play mediocre PC gamers at the same game... and guess what happened? They pitted console gamers with their "console" controller, against PC gamers with their keyboard and mouse.
The console players got destroyed every time. So much so that it would be embarrassing to the XBOX team in general had Microsoft launched this initiative. Is this why the project was killed Who knows, but I'd love to hear from anyone involved --- what happened?