News: Not canceled, yet not really in development any more either.
JoWood, the European publisher of Stargate SG-1: The Alliance has announced they have taken development of the title away from Australian company Perception. The game was in development for the PS2, Xbox and PC.
JoWood owns the licensing rights to the game so Perception has been ordered by the company to return the source code to JoWood. They are considering the option of finding another developer, but JoWood has this to say officially:
The title in its current form, initially scheduled for an October 2005 release, does satisfy neither our quality requirements nor the fans expectations. We will not release anything that does not do justice to this well known license. In recent months we have invested a lot of time and resources in helping Perception finish the development, but we now simply have lost confidence in their ability to finish this project in time and sufficient quality." This comes from Albert Seidl, CEO of JoWooD Productions.
Michael Paeck, Executive Producer for JoWooD Productions stated the game's future may lie on next-gen concoles. "We are, however, not prepared to release anything but a top quality title. Fans of the show as well as gamers would not accept anything less. There are several options to consider, among them potentially moving to next-gen consoles for the title."
North American fans of Stargate SG-1 are also out of luck as Namco, the NA publisher, has no say in the game's development.
So I guess we have to wait and see how this will all shake out.