"One former Lionhead employee even told me that Harrison once insisted that – with the exception of Remedy’s Quantum Break – Xbox’s European studios will never work on a ‘traditional’ game again."

Note: Phil Harrison left Microsoft on April 17th 2015

"Phil Spencer is now the man in charge. He’s a more conservative man, happy to adhere to the demands of his fans and focus on the big triple-A titles such as Halo, Forza and Gears of War.
One unsubstantiated story that reached our desks was that Spencer had gone into Lionhead and asked it if it was too late to turn Fable Legends into a more traditional product – a story I could well believe."

Looks like Phil Specer tried to save Fable Legends

http://www.mcvuk.com/news/read/opinion-dear-xbox-i-think-you-re-making-a-mistake-with-lionhead/0163920

Well. Dragon Age: Inquisition was re-purposed from an MMO to a more traditional product with great success, shame they squandered the potential that Fable Legends had.

Bad publicity possibly made then re-evaluate their decision.