Oh, yea MS let him do what he do.
GDC 07: Sakaguchi Wants to Make 360 MMO
Final Fantasy creator asks Microsoft to let him.
By Sam Kennedy, 03/06/2007
During today's Evolution of RPGs roundtable discussion, when asked about the importance of massively multiplayer games, Final Fantasy creator Hironobu Sakaguchi commented that he helped work on Final Fantasy XI and that he would like to speak with Microsoft's Shane Kim about doing an MMO for Xbox 360.
With Microsoft's Shane Kim actually in the room, he was then pressed to ask him on the spot. So Sakaguchi asked Shane Kim directly: "Please Shane, I want to make one." To which Shane jokingly said, "Yes." Obviously, whether this actually results in any future MMO game agreement remains to be seen -- but the interest is there.
Peter Molyneux then chimed in, "Can I do one as well, Shane?"
http://www.1up.com/do/newsStory?cId=3157788
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GDC 07: Sakaguchi Wants to Make 360 MMO
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