Here's a pretty succinct article by Jamie Russel on why the Halo movie fell over. It's acutally from his book: How video games invaded Hollywood
The short answer is money but it's a good read. Here's a snippet from the article:
What was apparent during the Halo deal-making was that Microsoft was far from home, perhaps even surrounded in enemy territory.
In the middle of the Halo negotiations, as all parties sat around the table, Shapiro recalls the discussion between Microsoft’s Hollywood liaison Peter Schlessel and Jimmy Horowitz, Universal’s co-president of production, taking an aggressive turn. “Schlessel was getting really tough on some of the terms with Horowitz: ‘Come on, don’t be a jerk, blah, blah, blah…’. It was getting really heated. The guy from Microsoft [Steve Schrek] was like, ‘Wow, this is really good.’
Then we took a break and Schlessel goes to Horowitz, ‘Are you coming over for Passover?’ Because they know each other. You don’t have those kinds of relationships in videogames. In Hollywood you can be getting at each other but then you’re playing golf together the next day.”
Even after the deal was struck, the misunderstanding over how the movie business operated continued to be a problem. Microsoft wanted a big-name director, but Peter Jackson, helmer on The Lord of the Rings trilogy, decided to sign on as a co-producer alongside Peter Schlessel, Mary Parent and Scott Stuber.
Jackson wanted his new protégé, an up-and-coming commercials whiz kid called Neill Blomkamp, to direct. With Jackson’s fee running to several million dollars the studios knew there was an advantage in hiring a cheaper, less well-known talent to sit in the director’s chair. Microsoft was reputedly not happy with the decision.
The joke is on them as Blomkamp and Peter Jackson went on to make District 9.
