The AI Gaming Disruption Thesis Doesn’t Add Up Owen Mahoney dropped a chunk on AI in gaming known as “Deus Ex Machina.” I’m an enormous Owen fan, and he opens with acceptable humility, warning that “if… | Eric Kress

The AI Gaming Disruption Thesis Doesn’t Add Up

Owen Mahoney dropped a chunk on AI in gaming known as “Deus Ex Machina.” I’m an enormous Owen fan, and he opens with acceptable humility, warning that “if you have a strong opinion about the future of AI in games, you are probably wrong.” But regardless of that disclaimer, his thesis sounds extra like a VC pitch deck than pragmatic business evaluation.

His projections embrace:
– Cut AAA prices from $300M to $30M
– Destroy writer benefits
– Triple the gaming market
– Transform the medium via AI-native experiences

Three issues with the market growth thesis:
Cost discount will not equal progress. Owen acknowledges that $300M to $30M does not make video games cheaper; it allows extra video games. But effectivity positive aspects get reinvested, not pocketed. Excel did not shrink finance groups. Photoshop did not lower artwork budgets. AI will not make gaming extra worthwhile; it will increase expectations.

Structural benefits stay. Thousands of soccer video games exist, however just one FC, rising 10%+ yearly for a decade. Why? League licenses. Athlete rights. Communities. Distribution. Owen argues AI “removes the final bottleneck” for publishers, however does not clarify the way it disrupts IP moats, relationships, or scale benefits. If something, AI reinforces them.

We have an consideration downside, not a content material downside. Steam will get 14,000 video games yearly. The constraint is discovery and participant consideration, not manufacturing. Even if AI allows one million new creators, that intensifies competitors for a similar finite participant base. More provide does not develop demand.

Here’s what’s lacking: If AI goes to increase the market, it wants new platforms that clear up discovery and attain new audiences. Mobile did not simply allow new recreation varieties and enterprise fashions; it created the App Store, which introduced gaming to individuals who’d by no means purchased a console. TikTok did not simply make movies simpler; it made discovery easy. AI wants that sort of platform innovation, not simply higher instruments.

The actual query is not whether or not AI can create new experiences; it is whether or not these experiences develop the participant base as an alternative of simply reshuffling it, and whether or not the enterprise fashions truly work. More importantly: the place’s the AI-native platform that solves discovery and brings non-gamers into gaming? Without that, we’re simply making it simpler to flood an already saturated market.

So yeah, AI will enhance workflows and decrease boundaries. Those are actual advantages. But tripling the market requires AI-native platforms that clear up discovery and attain genuinely new audiences, not simply higher instruments for making current video games. Owen believes we’ll discover them. I’m skeptical till somebody builds one and proves it really works at scale.

Where am I improper? What’s the AI-native platform that really expands gaming past current gamers?