It's understandable, specially after the TLOUP1 PC port issues. They better take their time to make sure they release a great, complete and polished game that performs super well, instead of a half finished broken mess.
If the game needed more time to be improved, this is the correct decision.
Also, it's nice to see they confirrmed to be working on another single player game. I bet that the single player game is the Uncharted game teased in the Live from PS5 ads, and if not a new IP.
This project is going to be canceled.
They didn't cancel it, they delayed it. Naughty Dog took some extra time to implement improvements suggested by Bungie. To delay games is super common, to cancel them not much in top studios like Naughty Dog specially with games publicly teased.
Can It be in worse shape than any of the gaas games shown yesterday?
Unlike Naughty Dog, the teams at Bungie, Haven and Firewalk have many key people who worked in some of the most successful AAA GaaS ever. So probably yes.
I mean, not in polish of visuals, combat, amount stuff developed, fun and so on, that part pretty likely already is great. But instead in the GaaS part to keep engaged players in long term: their plans to keep expanding and evolving it over time, collecting/filtering/implementing player feedback, a long term player progression and unlocks, design of events and seasons roadmap, related balance of certain things, internal game KPI metrics and statistics monitoring, security, server structure, scalability, stability and balancing and so on.
This postlaunch side is key for GaaS, and has nothing to do with non GaaS titles, even most multiplayer ones. It's totally understandable that even if ND would have skilled people needed an expert hand to guide them and help them improve in this area. And this is one of the reasons of why they buy Bungie. To help them improve with these things.
One of the best single player devs out there stuck on dev hell because of an AAA as a service.
Game is in development hell.
Delaying a game isn't development hell. Delays are very common in game development, but most of them aren't publicly announced. Specially when they still haven't formally announced and shown the game.