Typing would definitely be a serious issue. I'm not very familiar with XBOX, but if there's a microphone feature then it should definitely be implemented.
And as a stand alone game? No, that would definitely not work out. Maybe as a free download from the XBOX LIVE store or whatever it is called with in app purchases.
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Awkwardness to the max on guild chats. lol. It just shouldn't and really cant be on xbox live because typing is the core gameplay of graal. XD