When you think of Lionhead Studios, located in the United Kingdom, you may think of the buy out rumors, the recent layoffs, or some other off-collar topic. But when we think of Lionhead Studios, we think of the God of Simulation, Peter Molyneux. Now, if you don't think Molyneux is the God of Simulation, that's fine. However, we stopped by Lionhead Studios on a recent trip to the UK, and what we saw really makes us think that Molyneux is the true God of Simulation (we won't say that anymore, we promise).

We sat down and talked to Peter Molyneux for a good while and discussed everything from the rumored Fable 2 to his new development place center dubbed, The Room. As always, Molyneux was quite composed and very open to show us what Lionhead was all about. We also saw some things that we can't talk about, but within the next month or so you'll be hearing big news on that, we promise.

Lionhead has just released Black & White 2 and The Movies, and while we were visiting the development studio, the team was wrapping up on the upcoming Movies expansion, Stunts & Effects. But the recently released and upcoming titles weren't the star attraction of our visit. What really impressed us was a new development tool that Molyneux and his team has been working on dubbed The Room.

The Room is more of a play center than a development tool because the concept is just so cool. When you first boot up The Room, it looks like an ordinary room that some old person would be sitting in. You can create several objects using what looks almost like clay, and Molyneux showed us a TV set, a couch and several other objects.

What was very cool though, was when Peter created two mirrors. He placed one mirror on the ground and another standing upright against the wall. He then created a bowl of oranges and dropped one orange through the mirror on the floor. What happened next was rather odd to say the least. The orange can out of the other mirror and was now a considerably larger size. You see, the mirror that was standing upright was larger than the mirror on the floor, so anything dropped through it became larger as well.

In addition to the cool things going on with the mirrors, the room aged with time. Peter and his staff can change the progression of time, but in the version we saw, the time was super sped up. What this did was cause the floor boards to warp, the cushions on the couch to age and wear, the wall paper to fade, and all kinds of other cool things. Add to that the fact that everything in the room was fully interactive and this was one amazing tool.

Even more intriguing than The Room itself, was the purpose behind it. Peter wants his next generation titles to mimic the real world as closely as possible. To do this he asked one of his developers to create The Room that would allow the development team to do anything they wanted to and force creativity to come forth. Just to give you an example, one of the rooms we saw had a large bookshelf stuff with novels. Every novel had hundreds of individual pages. When something like that transfers to the next epic game from Lionhead, each page will have text on it, or possibly lead to a new area. Every draw in a dresser will open, every door knob will turn, we're talking reality on the Xbox 360 and PC here. The best thing yet is that everything created in The Room can be easily transferred to any Lionhead Studios development title.

So what's next on Lionhead's plate? Well, there is a certain title that we know for a fact will be announced very soon. Unfortunately, we've been held to silence until the official announcement is made. However, we will say that Molyneux is a big fan of downloadable and episodic content. We have the feeling this will play a big roll in Lionhead's next title. Unrelated to the studio's upcoming title, but probably related somehow to a title down the line, Molyneux was very clear that he's quite the fan of MMO titles. Could this mean Fable 2 will be an MMO? Probably not, because we asked Molyneux that very question and he quite frankly said that the next Fable (if it were in development of course) would not be an MMO, but there's room in the future for an MMO from Lionhead.

If we take one thing away from our trip to Lionhead Studios, it's the simple fact that Peter Molyneux knows what he's doing. The Movies, Black & White 2, and even Fable to an extent, all capture aspects of real life that most games completely miss. With the advent of The Room and the power of next generation consoles, we can't wait to see what Lionhead has in store for us at E3 2006 and in the coming years.