Microsoft spends $20 million a year to fund XBLA games

While there are a lot of third party games that are made available for Xbox 360 owners to purchase and download on its Xbox Live Arcade service, Microsoft also publishes a number of those games on its own. In a new article at Gamasutra, Ted Woolsey, the head of Microsoft's first-party publishing group for Xbox Live Arcade, reveals that the company spends over $20 million a year to help fund the development of Xbox Live Arcade games.

Woolsey said, "With our business increasing year over year we consider this a smart investment in the ecosystem, and another way we support the independent development community." He added, "We continue to respect and admire the work our developer-partners produce, and one of our main goals as a company is to empower people -- consumers and developers -- to realize their dreams through our technology."

The reveal of Microsoft's financial efforts for Xbox Live Arcade games comes as Microsoft has announced a new multi-year deal with the Independent Games Festival. The agreement will established a new annual "XLBA Prize". The winner of the prize will be picked by a jury of independent game creators who will also work with Microsoft. The winning game will come from one of the 2012 Independent Games Festival entrants from either the Main Competition or the Student Showcase.

The winning game and the development team of the XBLA Prize will get a publishing deal with Microsoft to release the game on Xbox Live Arcade, along with Windows Phone and the PC. It also includes full funding support to finish the game if the development team wishes.

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