Microsoft's Peter Molyneux and Phil Spencer

One of our strengths as an organisation is we're very focused on marrying our creative leaders with our platform initiatives early in incubation – Project Natal is an example of that. We looked at Natal as something we wanted to create to remove the barrier of any kind of controller between the player and the experience on the screen. The best way for us to make sure our platforms evolve in a way that enables the best creative experiences is to make sure our create leaders are identified and also closely tied into the work. So what we're asking Peter to do, and he's graciously stepped up, is a creative director role in Europe. Overseeing all of the creative work that goes on at our studios in the UK and in Europe and the different projects we have with external partners. His role there is to help the collaboration and to bring both the thinking from that region back to the platform and to Microsoft Game Studios as different things are incubating and being worked on. But the reverse is also true, of taking global knowledge of what's going on at the platforms and inside Microsoft Game Studios and help provide context and guidance to those teams. So it's not a pure management role. For us our best properties come out of great creative work and that's less of a management task and more about inspiration and aspiration.

Leadership is the perfect word. You're not all of a sudden going to see ten Peter Molyneux games. What I think the value of this role is, is someone like myself going in and making sure those little tiny lights of an idea can shine as brightly as possible and everyone within the organisation clearly understands why we're making those titles, the purpose of them and how they fit into Microsoft overall. All I'm going to do is making sure the lights are as bright as possible.

People at Rare and the other European studios are super, super bright and creative people and I'm probably going to learn as much about design as they will from me. I'm definitely not going to go in there and say 'I think this is a dumb idea and this is a good idea'. It's more about making sure they really are doing the experiences they're passionate about, because passion is really what we want. That's probably going to involve innovation, it's probably going to involve pushing people more on the innovation side, especially with Project Natal and saying 'don't think you've got all of your design comfort blankets any more, let's think of a new way of doing that'. In addition to all that, I'll be doing my existing role at Lionhead, I'll still be studio head and intimately involved in both the projects Lionhead are working on.

Well actually I've been doing the role for a few months already. The first thing is to go around making sure people don't see me and think 'oh my God, he's going to storm in here and throw all our designs out'. Like Left 4 Dead and I'm the zombies. It's about gaining people's confidence and understanding why people are doing a game and what they really, really want out of it. When people get involved in making games it's a huge part of their lives, it's a huge effort. Quite often in development, I've seen it a thousand times, people loose direction. Especially when you've got lots of voices shouting at you to make it more like this or more like that, whether that's the press or people within your own organisation. There just needs to be someone who can sit them down and help them remember why they're doing it in the first place. Remember what the experience is that we want to create.

I know what you mean by that, but actually one of the things I really want to do is help Rare have more of an identity. And make sure the people at Rare are seen more within the industry. I was totally blown away from the amount of talent that there is at Rare, but it's just that they come from a background where Nintendo required them to be this very, very secretive company. I just want to give them the confidence to tell the world what they're doing. I hope you're going to see more from Rare and I want to help them get well known. But you'll definitely still recognise a Rare game.

Well I've got three roles if you count the PR side. I'm the studio head and I've got a team of people around me who do all the tedious, mundane stuff and make me look super-good. Those people I've worked with for many, many years. My role in design in both the two projects – there's a team of designers there I've worked with for a very long time that are very used to me walking in and spending half a day or a day with them and not sitting with the all the time, and that won't change.

The funny thing is this is very much how it worked when Lionhead was an independent company because there was an enormous amount of work to do with investors and venture capitalists on the business side that I've been freed up from doing that since becoming part of Microsoft. This isn't a step change for Lionhead, it's more of how it's been for a long time.

I've definitely seen that we are more successful when we have creative leaders driving initiatives. Getting Kudo Tsunoda involved in Natal early on was pretty key to where we are today. That doesn't mean that all the studios that are working on Natal experiences report to Kudo. He's in a role of really galvanising the thinking, especially early on, and trying out stuff at an early stage with the technology involved and gathering the feedback. Look at Live, it's an area today that Ken Lobb drives for us and helps the full range of products from things like Live Arcade to Joy Ride and 1 Vs 100.

I do find success in the organisation when you find creative leaders who can really own a space and help define it for us and communicate as much externally as they do internally about where we want to go. Europe is extremely important to us as a platform, it's a huge market and we understand that it's a collection of little markets that are mid-cycle and you need to think about them independently, so it's important to have that leadership there.

That's exactly right. I moved into the role of head of worldwide studios when I came back from London and one of the first things I did was try to think of all the strategic initiatives that all the different studios thought they were on and I drew this chart and had ten or eleven different things on there. And I recognised from that, as an organisation we need to focus. We have great talent in the organisation but we need to make sure that talent is really focused on fewer things that we can do extremely well.

The downsizing that we went through was more about removing things that weren't a core focus of the organisation and creating scale and space for us as leaders to think deeply in the areas that are going to be critical in terms of our long-term success. Live is a crucial area for us, for example. And since that time we've hired a significant number of people back into the organisation and I expect we will refill all of those positions and even more. The acquisition of Big Park was perfect, we've been working with them for over a year on Joy Ride and what we found was a studio of people that were really committed to online, free-to-play, micro-transactions and building new IP. It made sense for us to work together more closely and that's why we went through the acquisition. It's about getting focus behind the initiatives that really matter.

Absolutely. It's a huge creative mountain to climb, it really is. It requires designers and creative people within MGS to really think in very different ways. Because the key thing is to use Natal for creative experiences which are going to really surprise people, whether they are experiences you expect or with completely new genres. It's more important than ever that we look at Natal and realise it's a huge opportunity.