this post was submitted on 02 Feb 2026
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Gaming market melts down after Google reveals new AI game design tool — Project Genie crashes stocks. (A.K.A . Investors panic because they don't understand what "real" videogames are) (www.tomshardware.com)
submitted 1 day ago by ekZepp@lemmy.world to c/games@lemmy.world
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Yesterday, Google announced Project Genie, a new generative AI tool that can apparently create entire games from just prompts. It leverages the Genie 3 and Gemini models to generate a 60-second interactive world rather than a fully playable one. Despite this, many investors were scared out of their wits, imagining this as the future of game development, resulting in a massive stock sell-off that has sent the share prices of various video game companies plummeting.

The firms affected by this include Rockstar owner Take-Two Interactive, developer/distributors like CD Projekt Red and Nintendo, along with even Roblox — that one actually makes sense. Most of the games you find on the platform, including the infamous "Steal a Brainrot," are not too far from AI slop, so it's poetic that the product of a neural network is what hurt its stock.

Unity's share price fell the most at 20%, since it's a popular game engine. Generally speaking, that's how most games operate: they use a software framework, such as Unity or Unreal Engine, which provides basic functionality like physics, rendering, input, and sound. Studios then build their vision on top of these, and some developers even have their own custom in-house solutions, such as Rockstar's RAGE or Guerrilla's Decima.

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[–] Taldan@lemmy.world -3 points 1 day ago* (last edited 1 day ago) (1 children)

It's an initial proof-of-concept. It'll be developed into more complex games eventually, that's not really an issue for it

The main issue is that it's just a facade. It completely lacks the foundation required for a game. It's a world without hard rules, which is a terrible experience for any user. The game isn't determining cause and effect from actions. It's just guessing at what would come next

What's the point of decorating an in-game house if the next time you go there, the AI forgot what was supposed to be there?

What's the point of completing quests if the AI forgets what you've completed?

What's the point of getting new gear if AI hallucinates what gear you have?

There is no progress in an AI generated game because everything is made up as it goes. Google would need to fundamentally change their approach to allow for that

That being said, this and similar technologies could be used to add really cool mechanics in a game that previously weren't feasible. The ability to add a temporary dream-like or watercolor aesthetic easily would be great for small developers to tell stories

[–] CountVon@sh.itjust.works 9 points 1 day ago

It's an initial proof-of-concept. It'll be developed into more complex games eventually, that's not really an issue for it

Except it is an issue, just one being masked by the mountains of cash these companies are burning to provide AI. To increase the depth and complexity and actually store state would require orders of magnitude more energy, compute, memory and storage. The AI bubble is causing very single one of those to become more expensive. At some point the market will call bullshit on these companies ("show us profit, or at least exponential revenue growth, or line go down"), at which point these companies will attempt to download the costs onto their users. When people see the bill and realize what these services actually cost, the whole thing is gonna collapse like a flan in a cupboard.