January 03, 2007 at 05:00 AM EST

His movies have entertained millions and grossed more than $1 billion domestically, but even Peter Jackson didn’t have the clout to keep Universal and Fox from recently backing out of his big-screen adaptation of Microsoft’s Halo videogame. The studios, which had promised $145 million to the soldiers-versus-aliens film, were reportedly concerned about escalating budgets and the 27-year-old director, Neill Blomkamp (feature credits: none). Consequently, Universal, on behalf of both distributors, asked the filmmakers to renegotiate their contracts. Exec producer Jackson & Co. balked. (Both studios declined to comment, as did Jackson.)

But gamers shouldn’t lose heart. Microsoft is in discussions with other partners, and preproduction on the effects-heavy film continues at Jackson’s studios in New Zealand. Working off a new script by Oscar-nominated scribe Josh Olson (A History of Violence), the film is — at least for the moment — game on.

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