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    HomeTechMicrosoft, Sony among AI winners in games, Morgan Stanley says

    Microsoft, Sony among AI winners in games, Morgan Stanley says

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    Game platforms, including Microsoft Corp’s Xbox and Sony Group Corp’s PlayStation, are expected to be the main beneficiaries of artificial intelligence (AI) adoption in the gaming industry, according to a report by Morgan Stanley. The report states that platform companies, such as Unity Software Inc, Roblox Corp, and Tencent Holdings Ltd, are likely to be more insulated from the risks of AI disruption and could become the main distributors of AI tools.

    AI technology offers the gaming industry an opportunity to transform its business model, which has become bloated and formulaic in some cases. Rising costs and stagnant product prices have prompted game companies to adopt and develop AI tools. “New AI tools look set to change how games are made,” wrote the Morgan Stanley analysts in their report.

    However, the impact of AI adoption on publishers is expected to be mixed. While it will lower the cost of producing and operating top-tier “AAA” games by up to 15%, it will also increase competition in the market, according to the analysts. Morgan Stanley identifies larger game publishers such as Ubisoft Entertainment SA, Nexon Co, and Take-Two Interactive Software Inc as potential beneficiaries of AI technology, with Take-Two Interactive Software Inc projected to see a potential 10% increase in earnings due to reduced costs. Conversely, smaller publishers like Playtika Holding Corp are expected to benefit the least from AI adoption and may face lower barriers to entry.

    Bloomberg reports that Morgan Stanley sees a “clear AI bull case” for the larger AAA game publishers, while cautioning about the potential risks posed by increased competition. The report indicates that AI adoption will reshape the gaming industry, revolutionizing the way games are created and distributed.

    ALSO READ:  Google’s new virtual assistant to include Bard AI tools

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