A recent report reveals that Microsoft CEO Satya Nadella considered the possibility of closing down the Xbox division in the past. This discussion emerged after calls from an investment firm associated with Microsoft co-founder Paul Allen, advocating for the company to divest Xbox as a standalone entity. Despite this, Nadella has reinforced Microsoft’s commitment to the gaming sector, stating that the company’s investments are not merely a means to an end.
Nadella emphasized Microsoft’s long-standing dedication to gaming, highlighting that Microsoft Flight Simulator was established before the first version of Windows was even launched. “Gaming has a rich history within the company, and our intent is to focus on gaming for its own sake,” he asserted.
In a recent interview, Nadella addressed inquiries regarding whether he foresaw gaming’s role in bolstering Microsoft’s advancements in artificial intelligence, suggesting the potential to utilize gaming to train AI models. “We aim to integrate our assets to enhance value. Cloud gaming is a strategic investment as it broadens our Total Addressable Market, enabling gaming accessibility everywhere,” he noted.
Furthermore, Nadella mentioned Microsoft’s investment in AI through the new Muse technology, designed to streamline game development processes. “As the world’s largest game publisher, improving our efficiency is essential. However, quality must always remain our primary focus,” he added.
Muse technology is touted by Microsoft as the world’s first “world and human action model,” initially trained on Ninja Theory’s previously abandoned title, Bleeding Edge. Notably, Ninja Theory clarified that Muse would not be used for game creation but rather to assist developers in working more efficiently.
Nadella drew a parallel between gaming data and YouTube’s significance to Google, expressing enthusiasm for the potential of gaming data within Microsoft. “I believe that gaming data is to us what YouTube is to Google,” he stated.
The role of AI in gaming continues to spark debate across the industry. A recent GDC study indicates that a majority of game studios globally are already utilizing generative AI, despite ongoing concerns. Microsoft has acknowledged that while AI advancements may lead to short-term job losses, they could also create more opportunities in the future. Over the past year, Microsoft has laid off more than 2,500 employees in gaming roles, and the impact of AI on these reductions remains uncertain. Additionally, video game voice actors have recently gone on strike due to apprehensions regarding AI technology.
