Xbox 360 to offer user generated video games

Microsoft Corp said on Tuesday that it will turn to its Xbox 360 users to create new video games for its console to compete against MySpace, Facebook and YouTube.

The software giant wants to sell user-generated games later this year on its online Xbox Live service and while offering 70 percent of the revenue to the game developer.

In 2006, Microsoft began offering game production tools to amateurs and hobbyists under an initiative called “XNA,” which allowed developers to create a game that could run on the Xbox 360.

Most advertisements on the Web come from social networking sites where users create the content. Such sites are MySpace, Facebook and YouTube. However, the video game industry has relied mostly on deep-pocketed developers to create sequels or games based on licensed properties.

MySpace, Facebook and YouTube provide a forum for new software applications and videos for free, but they do not share the revenue.

However, Microsoft requires the prospective video game developer to buy a $99-a-year premium membership to the XNA Creators Club and does offer revenue share. The video game must also pass a peer-review system.

Xbox 360 games that are sold on the Xbox Live Marketplace for $2.50, $5 or $10. Gamers use Microsoft points to purchase the video games.