Microsoft Shows How To Make Money With ‘Community Games’

Do you like to make games? Do you want to make money? Microsoft wants to help you.

Microsoft has revealed their business model for Community Games, the YouTube-influenced service for games made on Microsoft’s free toolset, XNA Game Studio.

The company has teased this step in “democratizing” games for almost a year now. MTV Multiplayer spoke with former XNA head (now chief technology officer) Chris Satchell and new XNA leader Boyd Multerer about the announcement.

The basics: users can charge between 200, 400 or 800 points for their games. They cannot be free. Microsoft takes 30% of the profits, but if you make a popular title, they may help promote it. You can’t opt out of marketing assistance and Microsoft charges a fee, but the idea is increased sales balances that out.

For more on the reasoning behind each of these decisions, keep reading.

Microsoft-driven marketing sounds great and all, but what if you’re happy the way things are? If Microsoft chooses to help market your game, it’s going to happen whether you like it or not. The upside? How much the marketing costs you is entirely dependent on how successful the marketing actually is.

“We think the value you get from being front-and-center in our experience is a great return for that marketing fee”

“If we help you sell an absolute ton of these, it’s going to be up towards 30% [more of your total revenue],” said Satchell. “If it’s not doing so well, down towards 10%. We think the value you get from being front-and-center in our experience is a great return for that marketing fee. And what that means for you is a ton of exposure.”

Satchell views Community Games as a stepping-stone for independent developers. “If you think about this community, they’re kind of like the minor leagues — they’re coming up, they’re doing innovative things,” said Satchell. “And then you can, say, progress on to Xbox Live Arcade, which is kind of like the majors. Then, there’s the all-stars. These are the people who are creating “Gears of War 2″ — the blockbusters.”

The entire catalog will be available on You can even queue up games to download via the website. Though the Community Games interface will have genre breakdowns and lists of popular games, there’s still no true search engine on Xbox Live itself. The database on is a means to try and rectify that.

It sounds a little like Apple’s recently launched application store for the iPhone and iPod Touch. Unlike XBL Arcade, WiiWare and PlayStation Network, where hardware manufacturers are guiding the content developed for the service, Community Games embraces having as much content as possible.

“One of the goals of the entire program has always been to have the greatest diversity and the greatest amount of content coming through,” said Multerer. “We very purposely don’t want to be trying to guess what’s going to be a good game and what’s not, and preventing people from coming in. We’re not going to say no to any games that follow the terms of service. We’re going to let the community completely manage what games go in and how quickly.”

That doesn’t mean there won’t be some restrictions, however, but rather than establishing guidelines now, they’re going to watch the community develop.

It’s been a few weeks since I jumped into the ongoing Community Games beta, but Satchell and Multerer said plenty of new titles have shown up. That should continue to organically develop as we near the fall dashboard update. “Word Soup” is apparently one of the most popular at Microsoft.

I’ll have to check “Word Soup” out, and I’m interested to see how the independent community response to Microsoft’s plan. If you’re affected, feel free to drop me a line with your thoughts. I’d love to hear from you.