James Gunn (Slither, Dawn of the Dead, Scooby Doo 2) has posted an editorial on his official website talking about his experiences working with Microsoft on providing original content for Xbox Live. Here's a taster:
XBox saw it and freaked out. There wasn’t even a way to cut it down to make it acceptable. So they offered me the chance to do something else, and to take the rights to Humanzee myself, which I gladly did. That’s when I came up with the idea for SPARKY & MIKAELA. As long as it was PG-13, with no sex, they said it would be all right. So that’s what I shot. But they saw it and, again, freaked out. Obviously they had no fucking idea what PG-13 was, as they wanted me to cut the words "penis" and "vagina." They made me cut a piece of very fake poop and a bunch of other stuff. And then, when they were done making me cut things, they took the final cut and cut it up themselves even more before airing it.
To sum things up, Warner Bros was a bastion of creative freedom on SCOOBY DOO 2 in comparison. I’m not exaggerating or being facetious. Microsoft/XBox was by far the most dreadful, non-talent friendly company I’ve ever worked for. And if you think I had it bad, some of the other directors (most specifically, SAW director James Wan, who just happens to be one of my favorite people in the world) had it even worse.
I still love XBox gaming, but I think their original content plans are DOA, precisely because of situations like the experience I and some of the other directors had on the Horror Goes Comedy series. People on XBox are playing Grand Theft Auto 4, getting blowjobs from hookers and shooting them in the heads afterwards! The top downloaded content on XBox is South Park! But Microsoft wouldn’t let us get close to the extremity of that material, so I don’t know how in the world they planned to create their own successful original content. People didn’t want to see our shows, which were barely a half-step removed from something you’d see on the Disney Channel. It’s a shame. I really think XBox could have been their own Network, as well as a gaming console, DVR, and way to buy movies. I saw them as the future. But because of the small-mindedness of the Microsoft executives, who preemptively censored a lot of our scenes for fear of freaking out stockholders, they crushed the potential for something that would have kept them relevant for a long time to come. It seems, instead, the visionaries have landed at other companies.