Microsoft believes that its Xbox Live Arcade is set to "leapfrog" its competitors in the coming months, thanks to XNA-created games.

First unveiled at the Games Developers Conference in February, the Community Games initiative will become a channel for professional and amateur developers to deliver experimental titles on Xbox Live Arcade.

"I certainly think from an innovation perspective it's going to help us leapfrog the competition, effectively until they find a way to duplicate it, assuming they ever do", said David Edery, Xbox Live Arcade's worldwide portfolio planner.

"To some extent it will certainly help us have more innovative content than either of them, just by definition. With all this random stuff coming from the community, every once in a while there's going to be a real gem in there that you just couldn't have found otherwise, it wouldn't have found its way on to a console", he added.

Expected to go live before the end of the year, it will open up the realms of Xbox gaming, helping to identify and create niche audiences that are currently not being served by he gaming market.

"The example I always like to give is will someone finally make that scuba diving game, where there's really only 15,000 people interested in a hardcore scuba diving simulation, but they really, really want one? And maybe through XNA someone can profitably get one out there", said Edery.

"Today, there's not really a venue for that. I'm not going to green light a hardcore scuba diving game for Xbox Live Arcade today because there are not enough people who are interested in that. But with XNA it's perfectly possible."