Stephen Toulouse, director of policy and enforcement for Xbox Live, has tweeted this morning that Microsoft is changing the XBL code of conduct to allow users to express their sexual orientation through their profile or gamertags.

According to the new policy, you can start using the terms Lesbian, Gay, Bi, Transgender, and Straight in Gamertags and profiles.

However, you may not use these terms to insult or berate other uses on Xbox Live.

Marc Whitten, general manager of Xbox Live, posted a letter on the official Xbox website.

I’d like to announce an update to the Xbox LIVE Terms of Use and Code of Conduct which will allow our members to more freely express their race, nationality, religion and sexual orientation in Gamertags and profiles. Under our previous policy, some of these expressions of self-identification were not allowed in Gamertags or profiles to prevent the use of these terms as insults or slurs. However we have since heard feedback from our customers that while the spirit of this approach was genuine, it inadvertently excluded a part of our Xbox LIVE community. This update also comes hand-in-hand with increased stringency and enforcement to prevent the misuse of these terms.

I truly believe that our diversity is what makes us strong: diversity in gaming and entertainment options, and diversity in the people that make up this amazing community. I look forward to seeing you on LIVE soon.

Well done, Microsoft. Good to see progress in our accepting ga(y)ming community. See that? That’s a pun.

Also, before anyone asks…yes, that is a three-headed panda monster vomiting rainbows.

Just Cause 2 demo is now available on Xbox Live and the PlayStation Network.

WHAT’RE YOU WAITING FOR?

There’s 35 square miles to explore! Get crackin’!

Demo weighs in at about 1GB of download, so you might be waiting a while. Also, no sign of a PC demo on Steam yet, but likely it’ll be up pretty soon.

Full game’s out for all three platforms on March 26th!

The new Halo Reach trailer went live today, showing off the much hyped new game modes.

But nobody cares about any of those! You know why? Because Halo: Reach’s online multi-player will come with… wait for it… jet packs!

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Square-Enix confirmed that the Just Cause 2 demo will be out for Live, Steam and PSN next week, March 4th for all platforms.

This information comes via Twitter from SE UK community bod Mike Oldman.

The Just Cause 2 demo will hit Xbox Live, PSN and Steam on March 4th.

In addition, Mike Oldman told fansite Panau Island that the demo itself will include roughly 35 square miles of play area of sandy desert with towns, settlements, military bases and more.

“There’s also one whole multi-stage faction mission for you to try, a race challenge and ample opportunities to cause chaos at pretty much every turn. There’s a good mix of vehicles, everything from tuk tuks to planes, helicopters to jeeps, military and civilian,” he told Panau Island.

“We really want you to play it again and again, to try out as much as you can. If you don’t fancy tackling the mission for example, don’t. See if we care. You’ll easily find something else to keep you occupied.”

Just Cause 2 comes out for PC, 360 and the PS3 on March 26th.

BioWare has just announced the next piece of free DLC for Cerberus Network users, based around the awesome Hammerhead tank, which is due to hit Xbox Live and PCs in March.

The “Firewalker” DLC pack will contain five missions centred around the formidable tank (pictured above), which “hovers over the battlefield at up to 120 kilometers per hour and features a guided missile system ensuring accuracy even during aggressive maneuvering.”

So says BioWare. So it must be awesome.

Only players registered with the Cerberus Network – claimed by inputting a redeem code provided in first-hand copies of the game – will have access to the downloadable content.

Visceral Games GM Nick Earl said to Gamasutra that the studio would be releasing at least one title per year.

“What I’ve learned being general manager of the studio for the past nine years is you can overload a studio, and conversely, you can do extremely well financially, and at the end of the day, we need to be able to do that to continue to attract investment and be able to do the sort of creative endeavors we want,” he said.

“I know it sounds kind of trite, but we really believe that. We’ve really taken that on board here. What we put out, we want to put out at the absolute highest quality mark. We don’t need to do three of those a year. One is plenty, if we continue to drive that kind of quality here.”

Earl also said that Xbox Live and PSN would have certain “offerings” coming out this year.

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In an interview with OXM, Brian Jarrard states that he and the rest of the Bungie team regret not having a matchmaking option for Halo 3: ODST’s Firefight game mode and speculates that that may be a reason that ODST is not as popular as other Halo games.

“I regret not being able to go back and make Firefight in ODST work and have match-making,” he told OXM. “I think we would have loved to have done that.

“We’ve heard it from the fans, we’ve heard it from the press. It’s definitely something we’d have loved to be able to do but we didn’t have the scope on the project. We didn’t have the time.

“We accomplished a tremendous amount, but that’s probably the reason ODST isn’t being played as much right now as we’d like. It has had a shorter lifecycle than any of the Halo titles before.

“But Reach is our big chance to make up for some of those things.”

Or maybe it’s because ODST was a mediocre game in most aspects? Dunno, maybe that’s just me.

According to a post by a community manager on the SEGA company forums, Sonic 3’s level designer is back working on Sonic 4.

Earlier in the week, it was revealed to us that Dimps would be handling development for the new Sonic the Hedgehog game, but that’s no longer the case according to the forum post.

“So, is it just Dimps? Just Sonic Team? The answer is a bit of both. Yes, Dimps is working on the game. But there’s actually more to it than just that: at the same time, we also have members of Sonic Team, including the original senior level designer from Sonic 3 & Knuckles on the SEGA Genesis working alongside them.

“It is most definitely a partnership, and the result of this teamwork is something many of us are excited for.”

Well, I can definitely say I’m way more excited about Sonic 4 than I was before, but I’m still doubtful of the episodic release style.

The first episode of Sonic 4 is on its way to the PS3, 360 and Wii this summer.

According to EA’s Twitter, the Battlefield: Bad Company 2 demo has been downloaded by 3.5 million individuals on the PS3 and 360.

That is a lot of downloads.

The demo ends on February 25th, because the game is out March 2nd in the US and March 5th in the UK.

New screens of the game up at IGN, so feel free to have a look!

Microsoft Game Studios’ Ken Lobb that Pefect Dark’s XBLA release on March 17th will come with a bit of a bonus.

Goldeneye multiplayer levels Complex, Facility and Temple have been confirmed for Perfect Dark’s multiplayer, and Lobb told Kotaku that certain guns from the classic shooter will also be available for Perfect Dark’s multiplayer, albeit under different names for legal reasons.

Are you more excited for March 17th now? I am. :D

That’s right, you read that correctly: Rare classic Perfect Dark is hitting Xbox Live Arcade March 17th alongside three other games throughout the rest of March–Toy Soldiers, Game Room, and Scrap Metal.

And to sweeten the pot, should you buy all four games, Microsoft offers a kickback of 400 MSP and a month’s worth of Xbox Live Gold Subscription (the latter is only awarded if you’re already a Gold member)

Toy Soldiers drops first on March 3rd at 1200 MSP. We’ll see Scrap Metal on March 10th for 1200 MSP as well. Perfect Dark shows up March 17th for 800 MSP (!!) and Game Room will drop on March 24th for free, but to actually play everything, it’ll cost you 400 MSP for the dual-platform edtion.

This release of Perfect Dark sees the game re-mastered for a high-definition experience, and if you miss classic N64 shooting action as much as I do, definitely pick up this excellent shooter.

We all know that Sonic’s recent outings on home consoles have been lackluster at best, but we’ve all got high hopes for the upcoming Sonic The Hedgehog 4.

Another reason for having high hopes surfaced today, as it turns out Sonic Team isn’t developing the game. That task goes to Osaka-based company Dimps, best known among Sonic fans as the developers behind games like Sonic Rush and Sonic Advance, so they do know their way around 2D Sonic titles.

This move alone could spell success for this particular Sonic title, as many Sonic fans have downright disowned Team Sonic in recent years.

Valve has revealed over the Left 4 Dead blog that players have killed well over 28 billion zombies since Left 4 Dead 2’s release. The exact number the Valve release was 28,981,249,043 upon their measurement.

Now, here are some facts to help you put that outrageous number into perspective:

- The entire population of the planet has been zombified and killed 4.26 times.

- With the average height of a zombie being 6 feet, if you stacked them end to end they would circle the globe 1,322 times.

- If you placed 28,981,249,043 rulers end to end, they would reach 28,981,249,043 feet in the sky.

The last one made me laugh.

Expect that number to grow when The Passing gets released!

Valve has joined in on the festivities that is Microsoft’s X10 event and is detailing the first DLC pack for Left 4 Dead 2; “The Passing”. The new campaign is set for a March release.

In “The Passing”, the characters of L4D2 meet up with the original L4D survivors, Francis, Bill, Zoey and Louis. According to Valve’s Chet Fliszek, the original survivors will aid the new characters in finishing the third map in the campaign.

There will also be a new type of infected called the “Fallen Survivor” who will drop health kits and ammo when killed.

Eventually there will also be an add-on to Left 4 Dead 1, which bridges the gap between the original game and “The Passing”. We’ve also got some video footage of the Fallen Survivor after the cut

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Dead Rising 2 is scheduled to be released on American shores on August 31st, in Japan on September 2nd, and in Europe on September 3rd of 2010.

In addition to this game’s release, a playable prologue titled Dead Rising: Case Zero will be made available on XBox Live.