Videogame stocks slide on Google's AI model that turns prompts into playable worlds
· CNA · JoinRead a summary of this article on FAST.
Get bite-sized news via a new
cards interface. Give it a try.
Click here to return to FAST Tap here to return to FAST
FAST
Jan 30 : Shares of videogame companies fell sharply in afternoon trading on Friday after Alphabet's Google rolled out its artificial intelligence model capable of creating interactive digital worlds with simple prompts.
Shares of "Grand Theft Auto" maker Take-Two Interactive fell 10 per cent, online gaming platform Roblox was down over 12 per cent, while videogame engine maker Unity Software dropped 21 per cent.
The AI model, dubbed "Project Genie", allows users to simulate a real-world environment through prompts with text or uploaded images, potentially disrupting how video games have been made for over a decade and forcing developers to adapt to the fast-moving technology.
"Unlike explorable experiences in static 3D snapshots, Genie 3 generates the path ahead in real time as you move and interact with the world. It simulates physics and interactions for dynamic worlds," Google said in a blog post on Thursday.
Subscribe to our Chief Editor’s Week in Review
Our chief editor shares analysis and picks of the week's biggest news every Saturday.
This service is not intended for persons residing in the E.U. By clicking subscribe, I agree to receive news updates and promotional material from Mediacorp and Mediacorp’s partners.
Loading
Traditionally, most videogames are built inside a game engine such as Epic Games' "Unreal Engine" or the "Unity Engine", which handles complex processes like in-game gravity, lighting, sound, and object or character physics.
"We'll see a real transformation in development and output once AI-based design starts creating experiences that are uniquely its own, rather than just accelerating traditional workflows," said Joost van Dreunen, games professor at NYU's Stern School of Business.
Project Genie also has the potential to shorten lengthy development cycles and reduce costs, as some premium titles take around five to seven years and hundreds of millions of dollars to create.
Videogame developers have been increasingly adopting artificial intelligence as a way to stand out in a highly competitive industry dominated by large players. A Google study last year showed that nearly 90 per cent of game developers use AI agents.
However, the use of AI in videogames is a contentious topic, with many fearing that the technology could lead to a wave of job losses, after the industry went through record layoffs over the past few years as it recovered from a post-pandemic slump.
Newsletter
Week in Review
Subscribe to our Chief Editor’s Week in Review
Our chief editor shares analysis and picks of the week's biggest news every Saturday.
Sign up for our newsletters
Get our pick of top stories and thought-provoking articles in your inbox
Get the CNA app
Stay updated with notifications for breaking news and our best stories
Get WhatsApp alerts
Join our channel for the top reads for the day on your preferred chat app