Zico said:
I will bet my left nut that if Microsoft were presented with a mod which had proven success on the PC and PS3, Microsoft will seriously consider getting out for Xbox 360. Disregard any potential "oh but you'll have to pay MS points to get it" arguments for now. If a mod is going mean increased sales of Unreal 3 and/or 360 units, Microsoft will definitely consider there position.
Anyway, I'm off to insure my nuts just in case

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Yeah the unreal engine is being used in other games, even RS:V uses it, but these are third parties. Sony have a multi level deal with Epic, involving the optimisation of the engine purely for the PS3. Plus there is aswell as UT, the Engine optimization and another project on the go between Sony and Epic. Maybe the 360 version doesn't need as much effort to optimise it, as they already have a good grasp with GoW, and that they influenced the architecture of the 360.
As for mods, by the time the mod has been established, became popular and them MS decide to test it to death, then they certify it, then distribute i, that will be a lengthy process in total.
Also it is easy to say disregard the MS points thing, but if PC users and PS3 users are downloading user created mods for free, why should MS charge, the probable 800 points, for users to d/l it?
and who gets the money/royalties?
Who owns the rights to the mod?
Will the user who made the mod need to keep it exclusive to the 360?
Will the mod need to be built on the xna then uploaded?
It will be quite an in depth process for it to go on live.
I think the mod editor will be on the disc on the PS3, and even then just transfer it through USB, or maybe upload it to a community website.
I am sure there will be mods, but it will be more of an official mod type affair.