Microsoft and Inworld AI join forces to create AI tools for game developers

Microsoft has announced a partnership with Inworld AI to develop AI game dialogue and narrative tools at scale, including an AI design copilot and an AI character runtime engine.

Microsoft will bring out several AI-powered tools to aid in game development. (Bloomberg)

Last month, Morgan Stanley analysts predicted that Microsoft and Sony could benefit from the adoption of artificial intelligence (AI) technology in video games, stating that both companies will be “the most clear-cut beneficiaries of AI adoption in the game industry”. As development costs increase and product prices remain stagnant, more and more developers are adopting AI tools, which could help cut costs by 15 percent. Microsoft has now announced that it is partnering with Character Engine for AI NPCs called Inworld AI to develop AI tools. Let us take a closer look.

Microsoft to develop AI tools

The multi-year partnership with Inworld AI will see Microsoft develop AI game dialogue and narrative tools at scale. It will include a multi-platform AI toolset to assist and empower creators in dialogue, story and quest design. One of the key tools that Microsoft will develop is an AI design copilot that assists and empowers game designers to explore more creative ideas, turning prompts into detailed scripts, dialogue trees, quests and more.

Moreover, the company will also create an AI character runtime engine that can be integrated into the game client, enabling entirely new narratives with dynamically-generated stories, quests, and dialogue for players to experience.

In a blog post, Haiyan Zhang, General Manager of Gaming AI, Xbox said, “As with all creators tools we make at Xbox, our goal is to deliver state-of-the-art AI tools for game developers of any size, anywhere in the world and on every platform where players want to play. 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.”

The development of both of these tools will be led by Inworld's expertise in working with generative AI models for character development, as well as Microsoft's cloud-based AI solutions such as Azure OpenAI Service. Microsoft has clarified that these tools will be offered as optional to developers who will have the choice of whether to use them in game development.

“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”, Zhang added.