Microsoft is bringing AI characters to Xbox

Microsoft is partnering with Inworld AI to develop Xbox tools that will allow developers to create AI-powered characters, stories, and quests. The multiyear partnership will include an “AI design copilot” system that Xbox developers can use to create detailed scripts, dialogue trees, quest lines, and more.

“At Xbox, we believe that with better tools, creators can make even more extraordinary games,” explains Haiyan Zhang, general manager of gaming AI at Xbox. “This partnership will bring together: Inworld’s expertise in working with generative AI models for character development, Microsoft’s cutting-edge cloud-based AI solutions including Azure OpenAI Service, Microsoft Research’s technical insights into the future of play, and Team Xbox’s strengths in revolutionizing accessible and responsible creator tools for all developers.”

The multiplatform AI toolset will include the AI design copilot for scripts and dialogue, and an AI character engine that can be integrated into games and used to dynamically generate stories, quests, and dialogue.

Inworld has been working on AI NPCs that react to questions from a player, much like how ChatGPT or Bing Chat responds to natural language queries. These AI NPCs can respond in unique voices and can include complex dialogue trees or personalized dynamic storylines within a game. Inworld’s technology can also be used for narration, so companions in top-down RPGs can warn of groups of enemies or players up ahead.

“AI has long been an integral part of game development, with applications ranging from enemy AI to procedural generation,” says Ilya Gelfenbeyn, CEO of Inworld AI. “The emergence of large language models and generative AI has unlocked new opportunities for storytelling and character engagement within games.”

Microsoft is only offering this as an optional tool for game developers, so it will be up to them to decide on the level of generative AI in future titles. The Finals developer Embark Studios recently had to defend against its use of AI-generated voices, arguing that “making games without actors isn’t an end goal,” in a statement to IGN.

Any use of generative AI in creative fields like game design or voice acting is controversial, with the SAG-AFTRA actors union voting to approve strike authorization for video game performers recently. “Between the exploitative uses of AI and lagging wages, those who work in video games are facing many of the same issues as those who work in film and television,” said SAG-AFTRA’s chief contracts officer Ray Rodriguez.

Microsoft is positioning its tools as a helping hand, much like how it has positioned its Copilot system for Microsoft 365 and Windows. “We want to help make it easier for developers to realize their visions, try new things, push the boundaries of gaming today and experiment to improve gameplay, player connection and more,” says Zhang. “We will collaborate and innovate with game creators inside Xbox studios as well as third-party studios as we develop the tools that meet their needs and inspire new possibilities for future games.”