Microsoft’s acquisition of Activision Blizzard is all set to be one of the biggest deals in the history of the gaming market. However, the reason for this acquisition might go beyond Blizzard’s war chest of intellectual property and award-winning game franchises. Reports have emerged that Blizzard is using AI in the game development process, and if it’s one thing that Microsoft loves right now. 

One of the key takeaways from the recent Microsoft Build conference was the introduction of Copilot into all Microsoft products. While Microsoft CEO Satya Nadella has expressed his desire to integrate AI systems into all products in the future, it seems that this strategy goes beyond just enterprise and customer facing products. Microsoft’s gaming division, Xbox, seems to be next in line for an AI makeover. 

Acquiring Blizzard goes beyond games

The regulatory smoke around Microsoft’s Blizzard acquisition is beginning to clear as more regulators approve the deal. Apart from getting ownership of blockbuster franchises, Microsoft will also get a foothold in the mobile gaming market through King, which is part of Activision Blizzard. However, considering Blizzard’s current creative strategy, there might be even more of an overlap than first predicted by regulators. 

In a leaked email, Blizzard’s chief design officer, Allen Adham, announced the launch of a new internal tool for game design. Titled Blizzard Diffusion, this image generator is completely trained on art from Blizzard’s games. In the email, Adham stated, “Prepare to be amazed. We are on the brink of a major evolution in how we build and manage our games.”

Reportedly, the tool will be used to generate concept art for game environments, along with artwork depicting new characters and the possible outfits they could wear. In addition to this tool, Blizzard is also testing a variety of AI tools for various applications in gaming, including autonomous in-game NPCs (non-playable characters), AI assisted voice cloning, and anti-toxicity measures in online games. 

While other game studios have only explored AI on a surface level, Blizzard’s attitude seems to be that AI can fundamentally change game design. In this, Microsoft and Blizzard seem to be on the same page. Microsoft’s gaming arm, Xbox, has an internal AI team to keep a track on how AI can change the way they make games. 

Along these lines, Microsoft Gaming CEO Phil Spencer recently appeared in an interview to speak about how AI can impact the game-making process. This seems to align with Microsoft’s larger strategy of supercharging creative tasks with the addition of AI. There is no bigger showcase of this than Microsoft’s recent build event. 

Building for the future

If it was one keyword that stood out during Microsoft’s Build conference, it was Copilot, or an AI assistant to assist with cognitive tasks. From Windows, to Office, to Bing, Microsoft has added OpenAI’s GPT-4 capabilities to all of its products. It seems that now this is going to not only extend to Xbox, but Blizzard as well. 

Phil Spencer stated, “The intersection of AI and gaming has always been there…I type something in DALL-E and all of a sudden I get an image, you can think about stuff like that for 3D assets as well.”

He went on to speak about how AI can also be used to create more believable characters that players can interact with in games. This comes after a Microsoft-owned property, the Elder Scrolls V: Skyrim, got an integration with LLMs through Inworld AI and the modding (modifying) community. 

It seems that Microsoft is learning from the community when it comes to how AI can be used to change gaming as we know it. This also aligns with Blizzard’s strategy of using AI in a variety of game dev applications, sweetening the pot for Microsoft. 

As the Redmond giant acquires Activision Blizzard, they will not only get access to a wide bevy of profitable franchises, but also to valuable internal game dev tools. As discussed previously, these tools will also include AI superchargers, aligning the interests between Microsoft and Blizzard even further. 

While it is not public knowledge the kind of impact that AI is already having on the game development process, there is also a negative side to using this technology. Video game voice actors have already come out against the usage of their likeness in AI voice models, and generative AI also has a bevy of copyright issues to wade through before it becomes mainstream. However, it seems that the path for Microsoft is clear now, as it adds even more Copilots to its arsenal.