[Hopefully we haven't been overegging the XNA Community Games topic, but ex-MTV Multiplayer editor Patrick Klepek was nice enough to write something custom - and balanced - about it for big sis site Gamasutra, and we're happily reprinting it here.]

Has Microsoft's Xbox 360-based Xbox Live Community Games service been a success? That's the question on everyone's mind, following the anxiously awaited release of sales data to developers.

The answer: it depends who you talk to. There have been successes and failures in the Community Games marketplace, with hard lessons being learned by both developers hinging their futures on the service and Microsoft as a platform holder.

It's been four months since Microsoft launched Community Games, an independent games focused compliment to Xbox Live Arcade fueled by games created with the company's free-to-download XNA Games Studio software.

During these four months, however, developers have had no idea how well (or poorly) their games are selling, the only metric being Major Nelson top-ten lists or user created leaderboards.

The numbers are finally in. The first response came from what many believed was an early success story, trippy side-scroller Weapon of Choice from ex-Insomniac Games developer Nathan Fouts and his studio Mommy's Best Games.

"The results are, in one word, sobering," said Fouts on his developer blog. "I left one of the best video game employers to strike out and make my own games. This is my full time job, I am not a hobbyist and Weapon of Choice shows that. It is a full-fledged game, which took a full year to make. Not only did we hope sales would recoup the savings we spent during the year of development, we hoped it would provide enough financing to support the development of our next game."

Fouts expected Weapon of Choice to fall into one of three sales categories. 30,000 more was a hit, 20,000 or more was acceptable and 10,000 or less was disappointing. Weapon of Choice sold fewer than 10,000 copies, but Fouts told Gamasutra his game was downloaded roughly 130,000 times.

Though Fouts wouldn't disclose the game's specific numbers, let's assume Weapon of Choice sold 10,000 copies. That's a conversion rate -- which tracks if a consumer downloaded a demo and then purchased the full game -- of almost 8%.

Is that low? The developer of Word Soup, one of Community Games' biggest winners in its first four months, doesn't think so. A conversion rate that high is fantastic, actually.

Word Soup co-creator and Fuzzy Bug co-founder Scott Newby told us the traditional conversion rate with PC casual or indie downloadable games can be as low as 1%. Word Soup, which was downloaded 46,405 times and sold 9,153 copies, produced an impressive conversion rate of near 20% and generated roughly $32,000 for Fuzzy Bug.

By comparison, in 2007, Microsoft disclosed that Xbox Live Arcade games experienced a 17% demo-to-full game conversion rate -- though that rate is believed to have dropped significantly since then.

Weapon of Choice was downloaded almost three times as many times as Word Soup. Both games were released at the same price point: 400 Microsoft Points ($5). There may be an explanation for the discrepancy between the download numbers.

"Our title and screen shot is quite descriptive so most people would know what they’re getting when they download the trial," said Newby.

One difference between a developer finding happiness on Community Games and wondering if they gambled incorrectly may depend on the scale of their project.

Ska Studios' founder James Silva, the one-man-army behind this week's The Dishwasher: Dead Samurai on XBLA, treated Community Games as side projects and come out very profitable. Between ZSX4 Guitarpocalypse and ZP2K9, an experiment in multiplayer programming, Silva has come away with roughly $9,000.

"A lot of small studios are pretty mad about sales," he told us. "I would be too if I'd rented an office suite, hired programmers, artists, and a PR chick, and was looking at a few thousand in sales. However, since my costs are just... rent... I'm pretty happy... For a small studio, [Community Games] is sure to be a letdown, but for a guy coding in his pajamas (mine are chef's pants still, in fact, I'm wearing them right now), it's awesome."

Silva may highlight a central issue with Community Games at the moment. Some, like Fouts, left their jobs and took a risk with Community Games. It offered a chance to move around some of the headaches that come with publishing on XBLA and direct games straight to the consumer. But it's a new service with its own set of growing pains and perhaps not yet ready to support yearlong development cycles.

"My advice for developers would be to try and keep the development costs down if they can," explained Newby. "We only committed a couple of weeks to the project so we're happy with what we've recouped –- if we'd spent several months we’d be less happy. Developers should have an idea now based on the selection of sales figures on how games can fare. I'd use this as a rule of thumb for now and if you’re going to set off to spend a year writing a massive RPG I wouldn't expect hundreds of thousands back."

Developers have come away from the first four months of Community Games with some hard lessons, but that's not to say Microsoft doesn't have work to do, either. Many developers have had public issues with Microsoft's treatment of the service, starting with the lack of sales information. If Microsoft had released sales data earlier, they argue, more would have understood the realities of Community Games.

With that issue in the past, however, there's more work to be done. Of the many Community Game developers we talked to, there were two very common requests.

1. Better visibility on the Xbox Live interface
"Look, my old gaming friend just got a 360," said Fouts. "His first mission was to buy Weapon of Choice. He couldn’t. That’s right, he couldn’t find it. He’s a normal gamer, and he simply couldn’t find Community Games at all. Eventually he did in a really silly way (had to go through the Guide button!) but that’s just absurd."

2. Let users rate the products, a la iTunes
"Frankly speaking, Community Games is flooded with games, and in the future it'll be a ocean of games," said Colosseum developer and Shortfuse Games CEO Johan Hermeren, whose $10 game sold just over 4,000 copies but saw user downloads of over 120,000.

"Also, the quality differs a lot. In that kind of situation it's pretty important to guide the gamers to buy the games that they really want to buy, and I believe that a rating system is way to go."

Microsoft isn't yet saying much about the response developers are having yet.

"Sales and expectations vary from developer to developer," said XNA developer marketing manager Lisa Sikora in an e-mailed statement. "Although this is still a very early snapshot of the Community Games sales potential, we’re finding that several of our top sellers will be taking home almost as much income from four months of sales as the average U.S. citizen earns in a full year. We at Xbox are very proud of offering a direct distribution channel to developers."

"We’re confident that this business will only continue to grow as more and more Xbox 360 owners explore the channel and discover its gems," she continued. "We’re always looking for ways to improve the consumer experience, but we don’t have anything new to announce at this time."

It's also worth remembering Community Games is only four months old. The New Xbox Experience hasn't seen a cosmetic facelift since its launch, a move that could drastically help exposure for Community Games releases. Plus, despite all the talk of doom and gloom for Community Games, it's also creating awareness for them.

Developers aren't giving up on the service yet, either.

"All in all, I believe that both these figures are correlated with a too hefty priced Colosseum, and that [Community Games] is new to people," said Hermeren. "Still, we at Shortfuse think that Community Games is a good thing though. XNA is awesome, low entry barriers for indies are awesome, the 360 is awesome."

The question isn't whether Community Games has been a successor or not, it's what developers chose to do with the service, now aware of its heights and limitations.

[GSW sister site GamerBytes has been leading the collation and analysis of Xbox Live Community Games sales data, and a recent Gamasutra cross-posted story has much more context on the service's first public data.]