08/18/2010 11:39 am ET Updated Dec 06, 2017

Peter Molyneux Demos Milo, the Virtual Boy

Peter Molyneux demos Milo, a hotly anticipated video game for Microsoft's Kinect controller. Perceptive and impressionable like a real 11-year-old, the virtual boy watches, listens and learns -- recognizing and responding to you.

Game geeks have been buzzing about Project Natal for, seemingly, ever -- Microsoft's now-in-development gaming device that goes the Wii one better by allowing your whole body to become the joystick, using touchless, visual-recognition interface technology. What kind of game will be played on this immersive new equipment? Peter Molyneux is working on one that redefines the whole notion of "game" -- Milo.

Milo is a little boy (there's also to be a little girl, Kate) who quite simply acts like a little boy, learning your name, talking with you, going on walks around the lake. It's an immersive, slightly uncanny experience, as seen in the single year-old demo that's still blowing minds on YouTube. Molyneux himself is a game-industry legend who has created many titles. In 1997 he founded Lionhead Studios, makers of Fable, a role-playing game. Microsoft bought Lionhead in 2006, and will release the much-anticipated Fable III in the fall.