Epic's AI pivot draws fire as Xbox hunts for new ideas

Aftermath's Nicole Carpenter reads Tim Sweeney's Tuesday post on X as the first concrete result of Epic's AI push: a delay. Sweeney described a 'huge pivot' that is moving developers around to retool for AI, and said the aim is to build more and better, not to do the same work with fewer people. Bloomberg reported that the unannounced Star Wars and Marvel game, once expected in March, has no new date, and that progress was slower than expected because Epic underestimated the staff and time required. The pivot follows March layoffs of more than 1,000 people, which Sweeney attributed to a Fortnite engagement downturn and said were unrelated to AI.

Carpenter points to Epic's own June art-concepting video, in which a developer concedes that the AI makes mistakes artists must fix. She also cites a GDC survey in which 36% of developers use AI at work and half think it harms the industry, a figure up 30% on the prior year. Executives are more positive at 19%. Her argument is that generative AI doesn't produce good-looking games, and that speed is the wrong goal when Steam already gets hundreds of releases a month. She quotes Sweeney's reply that much of the room 'wants it to be 2016 again'.

CounterpointSweeney and other AI proponents say the tools let teams, and everyone building on Unreal, make more and better work, and that the industry has to design for the present rather than the past. Supporters would add that early delays during a retooling say little about the end result.

Previously: Bloomberg reported that Epic ordered AI-first production on a Disney Marvel and Star Wars shooter. — Tuesday October 13 edition.

Respec's Tom Orry takes the Bloomberg report on Epic's AI-built Star Wars and Marvel shooter, which describes no hand-written code and art made with 'full AI workflows', and asks who can actually push back. His answer is the young audience. He says the industry's decisions will follow the bottom line: if the shooter and Fortnite succeed, an AI development future is effectively set, and if they fail, shareholders will demand change.

Orry, in his 40s and not a Fortnite player, points to his son and his friends. He describes them as quick to drop the game when they feel their time is wasted, and as having a sharp eye for what he calls AI slop, especially in art. He writes off Roblox as a lost cause but thinks there is a fight to be had over Fortnite. He admits the evidence is anecdotal, and concludes that if Epic cannot make an AI-generated Hulk fighting an AI-generated General Grievous look impressive, AI may not have the future in game development that many expect.

CounterpointEpic's leadership says AI empowers creators, and Orry concedes the evidence is one family's experience. By his own account Roblox shows that many young players accept lower standards, so quality complaints may not decide anything.

Previously: Bloomberg reported that Epic ordered AI-first production on a Disney Marvel and Star Wars shooter. — Tuesday October 13 edition.

Windows Central shared a transcript of an Xbox town hall in which CEO Asha Sharma reportedly said the company wants its best games to become billion-dollar franchises and also wants 'enduring new IP'. She added that Xbox 'will not survive' if it only revives the past. PC Gamer's Harvey Randall calls this confusing given what Xbox's 'Reset' has done: cancelled multiple Obsidian projects and pointed the studio at Fallout, sent Double Fine and Compulsion Games independent, set its sights on Arkane Lyon, and opened consultation talks on Ninja Theory after attempted sales failed.

Randall notes that several of those studios had just made new IP, such as South of Midnight, or specialise in inventive work. He allows that the studios were probably not making money and that backing strong franchises is understandable from a ruthless financial view. The one exception he offers is Hideo Kojima's Physint, which is technically new IP though not mainly Xbox-funded. His conclusion is that developers hearing the speech would be left confused.

CounterpointSharma and Xbox management would say that backing proven franchises and funding new IP are compatible. Randall himself accepts that the cuts make sense on the numbers, and a studio that is not profitable is hard to defend as an investment in invention.

Previously: Undead Labs head Philip Holt declined to share how many staff were lost in the split from Xbox. — Saturday October 10 edition.

In a memo to Xbox staff, Sharma announced Xbox Labs, a small group of game makers, engineers and scientists meant to turn emerging ideas into things players and developers can use. She said she was inspired by recent projects that decompiled games and rebuilt them for other hardware, ran PC builds on Apple Silicon, and ported games to browsers through WebAssembly and WebGPU. She also noted that coding became the first major workload for agents. Aftermath's Chris Person says the memo reads as a leader reacting to what she saw in her social feed.

He cites a clarification to GamesIndustry.biz that Xbox has no mandate to use AI and would use it only where beneficial, and that Labs hired no new staff and is a centralisation of existing initiatives. Person argues that, apart from an ideological pro-AI stance that devalues labor, he sees no benefit to Microsoft, and that the splash page reveals little. His larger point is that if agents can produce software on demand, Windows's business model is undermined, and he calls Copilot a joke even among people who like AI. He sums up the initiative as rearranging deck chairs.

CounterpointXbox and Sharma frame Labs as open experimentation that makes games more accessible and gives old games new life, and Xbox says it is not an AI mandate. Defenders of agent-driven coding would argue that Microsoft is better off exploring this shift than ignoring it.

Rockstar co-founder Dan Houser told IGN that Max Payne 3 was a failure on his part as a decision-maker and writer. He said he thought the game was a good 'digital noir' but that people missed Sam Lake's writing from the first two games. PC Gamer's Andy Chalk says Houser is wrong, calling it a brilliant cinematic shooter with strong cut scenes, a soundtrack by Health and a standout performance from James McCaffrey.

Chalk concedes that the game was no big commercial hit. In 2012 Take-Two said sales were lower than expected, and it said the same of Spec Ops: The Line, a game since widely praised. He leans on former colleague Andy Kelly's ten-year-old argument that Rockstar took real risks in breaking Remedy's mould, with an out-of-place Max in Brazil. His conclusion is that time has been kind to the game and that Rockstar nailed it.

CounterpointHouser's own assessment, and the many fans who wanted a Remedy-style Max Payne, point the other way. Take-Two's lower-than-expected sales result is also a hard measure of the reception Houser describes.

In a GamesIndustry.biz interview, Callisto Protocol and Dead Space co-creator Glen Schofield says Krafton forced Striking Distance to ship the game early. He says the March 2023 date was pulled up to December 2022 despite COVID staffing disruption, that the studio crunched while lesser features were cut, and that it also had to release on PS4 and handle some publishing and marketing work itself. He says Krafton thought the game a complete failure while his team shipped 86 patches and DLC.

Rock Paper Shotgun's Ashley Schofield (no relation) accepts that the patch point is fair but is wary of the account. She notes Schofield, who left in 2023 and has retired from game development, takes none of the blame himself, and says the business side is part of a director's job. She also finds the interview's closing remarks about Midjourney and putting AI 'to work where it makes sense' a depressing note.

CounterpointKrafton, whose CEO said at the time that the release fell short of market expectations, is not quoted in this account and would presumably say the studio's execution was at fault. Schofield would answer that the delay-compressed schedule and publisher decisions left no room to finish the game.