They were also working on a very generic co-op GaaS title that was based on a futuristic London. I know this because I have two friends who work at Sony London in Soho. Once of which, I went to Uni with and studied with. I messaged him under similar circumstances a few years ago in 2019 when Sony had big lay-offs then and effectively got rid of the whole SingStar team.
That being said, the feedback was that this co-op title was very, very generic and very woke. I was told to imagine something like what we saw with FairGames. Allegedly, the studio were pumped about it and loved it but were a little perplexed that testers didn't share their enthusiasm and instead of taking on board their criticisms, they kind of went "Oh, I know what this needs!" and would add a completely random mechanic to the game. Like a chef cooking a soup made from many ingredients but has no real identity and just tastes like it needs a little something, so you keep adding ingredients and tasting but not getting closer to a soup that tastes great.
Honestly, on one hand, I'm not surprised that canned London Studio. On the flip side, I really wish they hadn't. It could have been a great studio, but like Japan Studio and others, they just felt it was simpler to reduce them to a small role instead of really moulding the studio to be what they wanted and needed.
More pertinently and not related to your post, I said that when Jim Ryan said he was retiring that I think he'd been given his marching orders. A golden handshake to say, walk before you're pushed and we can make this amicable and favourble.
Many of these projects being cancelled probably were greenlit under Ryan who thought GaaS was the way to go. The evidence is there and seeing Connie Booth and her team fired, is a major reason to be concerned. But at the time, I was quoted and told my conclusion is ridiculous and things are sunshine and roses at PlayStation. Yet every day, we come closer to thinking I was right. I was worried about Sony from the moment Shawn Layden was pushed out by Jim. His vision of PlayStation didn't seem to align with what the console actually is and keep in mind, many projects that came out within 3 years of Jim becoming the head of PlayStation were likely greenlit and arranged by Andy House and Shawn Layden, both of whom are gone. Developers inside Sony clearly had an issue with this push to GaaS and I think the Bungie acquisition was a huge mistake. It was a knee jerk reaction to the Bethesda acquisition and it hasn't worked. If anything, it sounds like Bungie have contributed to the cancellation of The Last of Us Online title, whilst not hitting deliverable targets themselves.
I am concerned that Sony are going to be a victim of success here, that they haven't been accountable to anyone but themselves and in the midst of it, they've made a lot of costly decisions that have affected the future of the platform and the profit columns that aren't going to translate into growing the PlayStation as effectively, the core unit of Sony Corp. Which to be fair, is exactly what the new head of PlayStation has said.