Peter Molyneux's promotion suggests that Rare might be working on Project Natal too...

Microsoft has promoted Lionhead supremo, Peter Molyneux, to the position of Creative Director at Microsoft Game Studios in Europe, although Molyneux will retain his position as Lionhead's studio boss as well.

The announcement was made at E3 last night and early indications are that Molyneux is taking on the position to foster the creative growth of Microsoft's European studios. In short though, this means that he'll be overseeing Rare and Lionhead's creative operations (as these are MGS' only in-house European studios).

"What you're not going to see is ten Peter Molyneux games," said Molyneux (via gi.biz). "The value of this role is for someone like myself going in and making those little tiny lights of an idea shine as brightly as possible and ensuring everybody within the organisation clearly understands why we're making those titles, the purpose of those titles and their importance to Microsoft overall.

"All I'm going to be doing is making sure those lights are as bright as possible," he continued. "People at Rare and other European studios are super, super bright and creative people and I'll learn as much about design from them as they would from me."

However, Molyneux's comments also suggest that Rare might be used for the development of Project Natal: "I'm going to be pushing them more on the innovation side, especially with Project Natal, and saying, 'look, don't think you've got all of your design comforts here any more, let's think of a new way of doing all that.'"

Speaking of Project Natal, we've been doing some connecting of dots here at TVG in reference to a news piece we did last week which revealed job vacancies for a new Microsoft game studio that will "revolutionise both WHAT you play and HOW you play".

The location for the jobs are in Redmond, Seattle, according to the job ads, although the wording of the adverts does sound very much in the vein of work related to Project Natal. This leads us to ask the question: exactly how many resources is Microsoft putting into its new motion sensing technology?

If both Rare and Lionhead are working on Project Natal as well as this new studio based at Microsoft's headquarters, then that's quite a statement of intent from Microsoft.

Yep, it was obvious from their conference that they are very excited about Natal. They will be pushing it hard and will support it very well from their side. Now EPIC and Bungie will provide the core games along with third parties.

I hope not...simply because I want Killer Instinct sooner, rather than later. Anyway, Rare needs a big hit soon...they can have it with Killer Instinct HD...

Even without any games, I want to buy this. It seems like it will be fully integrated in the 360s design structure and will take the console up to the next level.

Also, if they can get me that Milo kid to abuse...that will just sweaten the deal.

Everything else is a bonus...and trust me, there will be a lot of "everything else" if a multi billion dollar company like microsoft stand behind a product.

As long as I can play Killer Instinct on a controller like it's supposed to, then I'm fine with it.

This. Imagine having to fight yourself using Natal? I think you would lose more weight doing that than with Wii Fit though.

What are you talking about? I cant wait to get to pull a 64 hit ultra combo on your ass...using my bare hands....

POW POW POW!!!

With Rare so involved with the Avatar system I believe it is pretty safe to say that the game/game compilation that ships with Natal will be Rare developed.