Sounds like a good move. Why bother spending time and resources into a game that clearly never got off on the right foot. If you aren't successful during launch, its difficult to reverse a downward trend in playerbase. Now they can consolidate their time and effort into projects that have a higher chance of success.
Sure there will be people upset and rightfully so, but games are a business. If studios aren't making money then what's the point. Cut their losses, learn from their mistakes and move on.
