Xbox Embraces Generative AI: Microsoft Unveils Game Development Tools

Microsoft is collaborating with one of its M12 venture arm’s portfolio companies, Inworld AI, to introduce an artificial intelligence toolkit for Xbox game developers. This toolkit enables developers to utilize AI in generating game dialogue and narrative tools.

The AI toolkit includes an AI “design copilot” and an AI character runtime engine, as mentioned in a Microsoft blog post published recently.

The design copilot transforms user-generated prompts into game scripts, dialogue trees, quests, and more. On the other hand, the character engine can generate new stories and seamlessly integrate them into the game client.

Haiyan Zhang, the Xbox General Manager of Gaming AI, expressed in the blog post, “Our goal is to deliver state-of-the-art AI tools for game developers of any size. We will collaborate and innovate with game creators inside Xbox studios as well as third-party studios as we develop the tools that meet their needs and inspire new possibilities for future games.”

Microsoft emphasizes that the AI tools are designed to assist game developers, empowering them to enhance their games. While AI has been present in gaming for decades, the use of generative AI powered by large language models (LLMs) is relatively new.

The development of dialogue-generating AI tools, such as Microsoft and Inworld’s AI toolkit, raises questions about the potential impact on the jobs of narrative designers and game writers. These tools could enable writers to create stories more quickly, but there is concern about the possibility of unnatural dialogue and potential job displacement.

Microsoft has outlined its ethical stance and approach to AI development through its “Responsible AI Standard” and the dedicated section on its website that focuses on advancing AI while upholding ethical principles.

Inworld AI secured $50 million in Series A funding in August from investors including Microsoft’s M12 fund, bringing the company’s valuation to over $500 million.

Edited by Andrew Hayward

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