According to a GI.biz report, Microsoft is planning to launch new digital content initiatives, in an effort to keep ahead of competing online services like Sony’s PSN and Nintendo’s upcoming WiiWare.

David Edery, the worldwide games portfolio planner for Xbox Live Arcade, says that one of these initiatives is user created content. Microsoft wants to support user created content on Live, but according to Edery, hasn’t exactly figured out how to deliver the content yet. Edery couldn’t pin a date, but did say that user created content is something that we can look forward to in the future.

In addition, Microsoft wants to bring more episodic content to Live. Penny Arcade Adventures is just the beginning:

The Penny Arcade guys are going to be bringing their episodic game to Xbox Live Arcade but I think of that as only the beginning – it’s just one model for episodic and there are lots of different models.

User created and episodic content next for Xbox Live Arcade [GI.biz]

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