Yesterday the gaming media outlets pretty much echoed the same news story over and over that cited a source that claimed that Versus XIII was being suspended so that the team could focus on Final Fantasy XIII as priority one.
Apparently nobody asked Square-Enix, themselves, to clarify on the matter.
Looks like a bit of a translation error is to blame for the round of false news going around. As it turns out what was being said was that the Versus XIII team, when available, has been working with the main XIII team to get the project done much faster. Now, the question here is who do you really want to believe?
Famitsu reported in an interview that Tetsuya Nomura stated that the development of Versus XIII was on hold and that the "entire" team of Versus XIII was working on FFXIII now. However, the publisher itself has since come out to clarify and claim that both games are on schedule and that Versus XIII is NOT on hold. Me personally, I think I'll side with Square-Enix on this one instead of taking some translation out of Famitsu. After the stream of news that SE was delaying Last Remnant for the PS3 and that Star Ocean 4 was only announced for the Xbox 360 the publisher might be trying to keep false/bad news for the PS3 crowd down to a minimum due to the Sony fanbase already up in arms about the recent string of announcements that have come from SE recently.
This bit of news should calm down the people be wept silently to themselves at the news yesterday and feared some sort of development delay.