The Xbox 360 Live Arcade service has certainly gone a long way - having sold US$ 250 million worth of downloads since its launch - but Microsoft is not one to relax and rest on its laurels. According to Xbox Live's general manager Marc Whitten, Microsoft's downloadable gaming service will undergo some changes in an effort to spruce up the Live experience.

One such change is the size limit increase of XBLA games, from 150MB to 350MB. "This means that we need to allow developers more time and more space to make even bigger and better games," said Whitten. Microsoft also gave XBLA game developers more leeway in pricing their games in addition to the increased size limit. Penny Arcade Adventures: On the Rain Slick Precipice of Darkness is one of the first games to take advantage of this price point.

An XBLA change that would keep game developers on their toes, however, is the delisting of games that are at least six months old and have a Metacritic score below 65. "We will be delisting older underperforming titles in order to keep the service focused on a section of high quality games," said Whitten. They won't be delisting games in an abrupt manner, however, since Microsoft will give the developers a three-month notice prior to taking them down from XBLA.

Finally, Whitten also mentioned that Microsoft will be opening a new first-party studio dedicated to producing "compelling and exclusive" content for XBLA. He didn't give any further details concerning the new studio nor the games that it will produce, but suffice it to say that it will definitely be something worth checking out. Do stay tuned for more details.