I saw this a while ago and started thinking that XNA could be the result of this.
A lot of interesting data came out of Ars Technica's interview with Matt Lee, a Microsoft software developer in the Xbox division. The nice thing about Matt Lee was that when the interview was over, he answered some questions in the discussion. A lot of it was clarifying points he made in the main article, but then he shared this story with us:
…allow me to share a related story. A little over a year ago, one of the people in my group modded an Xbox, installed Avalaunch, and put all sorts of Xbox mod scene apps on the box, like XboxMediaCenter, RSS readers, etc, along with some “backup” games. He brought this box along to a meeting with Bill Gates. Bill saw a demo of this, was quite impressed, and asked something along the lines of “How can we engage this community?” – instead of saying something like “How can we squash this?” It's long been on the back of everyone's minds in the Xbox group – how can we get students and hobbyists involved without disrupting the console business model? The good news is that it's still on the radar, we'll see what happens in the future.