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Xbox joins the use of AI: how will it impact video game development?

- November 7, 2023
- Updated: July 2, 2025 at 12:44 AM

It’s an obvious statement, but it’s true: developing a video game is not an easy task. The high costs involved, both in terms of human resources and technical equipment, make it challenging for many titles to be released and sustained in today’s market, especially for triple-A games. That’s why AI has managed to capture the attention of an industry that, despite being on the rise, seeks to generate even more profits if possible.
Given the situation, it’s not surprising to see how Microsoft has decided to join Inworld to “create narrative and dialogue tools aimed at large-scale AI games.” According to a company publication, this collaboration aims to “provide an accessible, multi-platform AI toolkit designed responsibly to assist creators in designing dialogues, stories, and missions.”
To begin with, this toolkit includes an AI design copilot. Essentially, it would serve to “explore more creative ideas” and transform small guidelines into “detailed scripts, dialogue trees, missions, and more.” Microsoft also discusses an AI-based character execution engine, which would enable generating dialogues and interactions with the player dynamically.
While AI has been employed in video games since time immemorial (for the functioning of enemies, NPCs, etc.), it now seems that it will gain even more relevance. The truth is, it’s not entirely clear what it will mean for the industry, but developers are not waiting to see the consequences. Just recently, members of SAG-AFTRA voted in September in favor of authorizing a strike under the Interactive Media Agreement, which covers workers involved in video games. Could we be facing a situation similar to the writers’ strike in the United States?
Artist by vocation and technology lover. I have liked to tinker with all kinds of gadgets for as long as I can remember.
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