It's been known for quite a while now that LucasArts has been backing a new Star Wars: Battlefront game.  Free Radical Design, the developer behind the critically acclaimed TimeSplitters franchise, was previously working on the game, evidenced by some assets leaked after they went into financial troubles late last year.  However, since then, LucasArts has been relatively quiet about the game.

According to an industry insider, Rebellion Developments are currently working on Star Wars: Battlefront III.  Rebellion worked on the 2007 Battlefront title for the PSP, and was funded to make the PSP and PS2 versions of Battlefront III, while Free Radical would work on the next gen versions.  Apparently, however, Rebellion made LucasArts an offer to develop the next gen versions cheaper and more quickly than Free Radical, leading LucasArts to cut funding to Free Radical, resulting in the developer going under.

Further, it's possible that, even after all this, we may not end up seeing a next gen version at all.  The targets set by Rebellion for the PS3/360 version are allegedly "impossible" to meet.  LucasArts may go the way the did with the new Indiana Jones game, and just not produce a high def version.

Unfortunate news for Star Wars fans, especially after seeing Free Radical's ground-to-space engine for their version of Battlefront III.