GS: How big is the download going to be on the 360 side?

DM: I really should know this, and I will follow up. It's small, I know it's small. Like less than 10 megabytes or so.

GS: So you would not necessarily need to have the hard drive, or would you?

DM: The hard drive is a required component. And the reason why it's a requirement isn't so much because of the size of download, but it's really because when you develop your games on the Windows PC side, where the games actually get pushed through onto the Xbox 360 is on the hard drive.

GS: Is there any intention to make the games more easily shareable at any time? Because I know they have to meet certain requirements before games can be shared and played.

DM: Oh absolutely. We're not trying to restrict the sharing, because that's going to bring an undesired sort of restriction on the creativity. If you can't share the creativity, what's really the rational or reason why you want to invest in bringing a game to market, or in this case into the community? And so, it's just our evolution of that vision that I talked about, the three components. Right now the tool enables the games to be created for both platforms more readily.

In 2007, where you're really going to see us investing is on that sharing point. First it's going to be about how do members of the Creators Club really share games more easily among one another, because we're seeing a lot of desire an interest and people doing that today. And then moving beyond that, once they want to take it past that threshold out to the end consumers, and like in this case, I make a game and I send it over to you to have you check out my game, and you're not a member of the Creators Club, I'd still love for you to be able to play it. That's absolutely the scenario that we want to support and start working on and enabling that in 2007.

GS: And will you be able to do things like, send people on your list invites to play your game?

DM: Right now we are working on the specific implementation of how this stuff will play out. What we're looking to do is take absolute advantage of the fantastic infrastructural in Xbox Live that we have today today and the 4 million subscribers that are connected to Xbox Live. It's a wonderful managed experience that as you know, you've got a friends list, they can leave you messages, they can leave you voice messages, it's a great system. But beyond that, wouldn't it be great to your point, that they could actually leave you a message that has a game embedded in it that is a XNA game that they've created or that they discovered, and they want you to check it out. It's from a trusted, reliable source, so you say “Why not, I'll play this.” That's a scenario that we've also drawn up on this side and storyboarded. It's one we're looking at whether or not we can support.

I think it's a fantastic scenario, to be able to create a game and with everyone on my friends list including my family, why shouldn't I be able to, to use J Allard's term, “squirt it over to them” over Xbox Live? And the next time they sign on, there it is. Or potentially, I shoot them an email, and they have the option of saying “Ok, I want to play your game, and I want to choose to play it on Windows. Or I want to play it on Xbox Live.” We're looking at a lot of ways in which users discover these, and where and how they want to play it, and we want to make that as friction free as possible and easy to distribute and share.

But now we're getting into that third component of the vision that's going to take more time, because much like Xbox Live, we want to make sure we offer it in a very managed, and very secure manner as well too. The last thing I want to hear is that I discover later on that you've got a game, and there's something malicious in it, or some undesirable content that you weren't expecting. There's a lot of investment that we're making along those lines to make sure that you get a great experience, great game quality, that you get exactly what is you expect when you load one of our games.

GS: So, and I know this is way far off, but what are you thinking as far as monetizing the games that will be popular? Will the impetus be on the person that made the game to sign an agreement with you or will they be contacted retroactively, if you have any idea?

DM: We've got ideas. We've got a lot of different directions that we're exploring. Some of those ideas I'll share with you you, though again with the caveat that none of these are the direction yet as far as which ones we're going to pursue.

But in terms of ideas, one of the ways is potential advertising revenue. We could have ads and stuff in there, so the more people in your game, the more ad revenue that is generated, and we could do an advertising revenue share with the creator of that content. Another potential opportunity could be, you sign a distribution agreement, we've got the network and you get a piece of the distribution, while there may be a nominal fee. Another may be that we have this great resource called Xbox Live Marketplace, and you just put the game up there, you set the price, and people could download it. I mean, the great thing about all of this is that we have such fantastic infrastructure in Xbox Live and Xbox Live Marketplace that we can evaluate and explore and lot of different and interesting directions of how we can take this as a business model that I think a lot of folks in the industry just aren't able to do.

We're maximizing that opportunity, we're looking at this all across the board, but the one thing that I can tell you is that we're going to be looking very diligently at ensuring that where possible that the owner of the IP retains ownership rights of the IP. We want to make sure that if the creator of the content is successful, they are absolutely garner a piece of the revenue that they're driving. What that revenue exactly looks like, we don't know yet. But they are absolutely at the core of the model, and we are making sure that they are a partner in the success of this community and the success of the sharing model we're building out.