No, I think they are going a different direction. It is a competitor, but it looks like this will probably be low cost or free and really is made to get people into developing games rather then being a platform designer program.
Definately, doesn't have the depth of LBP as a whole package. I saw it in October at the Microsoft Professional Developers Conference and it has come a long way since... But, I think Microsoft looks at this as an add-on, not a game to compete with LBP. Doesn't look like you will see Halo levels on it. LOL.







