Global Generative AI in Gaming Market By Technique (Deterministic and Nondeterministic), By Function (Image Enhancement, Non-Player Characters & Others) By End-User, By Region and Companies - Industry Segment Outlook, Market Assessment, Competition Scenario, Trends, and Forecast 2023-2032
- Published date: March 2024
- Report ID: 99021
- Number of Pages: 351
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Report Overview
In 2023, the Global Generative AI in Gaming Market was valued at USD 1,137 Mn. Between 2023 and 2032, this market is estimated to register the highest CAGR of 23.3%. It is predicted to reach a valuation of USD 7,105 Mn by 2032.
Generative AI helps to develop new content rather than repetitive ones so gamers can enjoy fresh content. Major companies like Ludo and Minecraft have already adopted this technique which never lets the user get bored. Artificial intelligence and machine learning tools can potentially transform gaming more radically.
Generative AI is a new concept in the arsenal of game developers and game designers, and it is anticipated to update game development despite the criticisms. Generative AI allows us to customize games according to users’ abilities, create new virtual worlds and eliminate predictability, improving gameplay. This presents a win-win situation for both gamers and game developers.
Note: Actual Numbers Might Vary In The Final Report
Generative AI offers enormous potential benefits in game development. Generative AI’s role lies in aiding content creators rather than repetitive ones – thus giving players something fresh every time. Companies such as Ludo and Minecraft have already taken to Generative AI as they produce games that never bore users.
The use of generative AI for making game content automatically is expected to grow by 45% between 2022 and 2024, as reported by Unity Technologies. This means that more games will have worlds, levels, and items created by AI, making the process faster and more varied.
NVIDIA has shared that the use of generative AI for making realistic characters in games, known as non-player characters (NPCs), is also set to increase. The adoption rate for this technology is projected to go up by 40% during the same period, 2022 to 2024. This indicates a significant shift towards using AI to create characters that gamers interact with, making these experiences more engaging and lifelike.
Moreover, Microsoft Azure has highlighted an emerging trend in cloud gaming. By 2024, it is expected that over 55% of cloud gaming platforms will use generative AI to optimize game content and streaming in real time. This advancement means that games played over the cloud can be adjusted on the fly to improve player experience, making gameplay smoother and more immersive.
Key Takeaways
- The generative AI in gaming market is booming, set to surpass USD 7,105 Mn by 2032. This growth is driven by the demand for immersive gaming experiences, the popularity of generative AI tech, and increased investments from developers and publishers.
- The APAC region is the largest market for generative AI gaming, followed by North America and Europe. In 2022, Asia Pacific dominated the generative AI in the gaming market with the largest revenue share of 34%.
- By 2024, it is anticipated that over 65% of new AAA video game titles will employ generative AI for crafting game worlds, environments, and levels. This suggests a significant adoption of AI technologies in developing intricate and immersive gaming experiences.
- Currently, 44% of organizations are testing generative AI, and 10% have fully integrated it into their operations. This reflects a growing interest and investment in generative AI technologies across various sectors.
- 60% of gamers hold the belief that AI will positively influence the gaming industry. This sentiment underscores the optimism surrounding the potential of AI to enhance gaming experiences, from storytelling to gameplay mechanics.
- The global market for generative AI is projected to reach approximately USD 255.8 Billion by 2033, up from USD 13.5 Billion in 2023. This growth is expected to occur at a compound annual growth rate (CAGR) of 34.2% from 2024 to 2033, indicating rapid expansion and increasing value within the field of generative AI.
- By 2024, more than 60% of new video game titles are estimated to include some form of generative AI technology, highlighting the widespread adoption of AI in game development processes.
- Additionally, by the end of 2024, over 50% of game developers are projected to utilize generative AI for creating game environments and levels, further emphasizing the technology’s critical role in shaping the future of game design.
- The sector of generative AI in game testing and quality assurance is expected to witness a growth rate of 32% annually from 2022 to 2024. This growth signifies the increasing reliance on AI to ensure games are free from bugs and offer seamless player experiences.
- It’s estimated that by 2024, over 40% of mobile games will feature generative AI for personalized gameplay experiences. This trend towards personalization is aimed at enhancing player engagement and satisfaction.
- Lastly, the use of generative AI for developing realistic game user interfaces (UIs) and heads-up displays (HUDs) is anticipated to rise by 35% between 2022 and 2024, marking a significant shift towards more intuitive and immersive gaming interfaces.
Drivers
Machine Learning Algorithm of AI to Boost The Market
The capability of generative AI tools like enhancing the intelligence of non-player characters (NPCs) and changing scenarios & stories on the fly are driving the market growth. In addition, the ability of machine learning algorithms in games helps to adapt the gamer’s behavior and performance. According to gamers’ performance algorithms adjusting the difficulty levels and ambiance, this adaptability of AI is expected to drive the market.
Game Asset Generation
The machine learning algorithm of AI is driving market growth as developers are inclined toward AI-generated assets to develop the overall quality and experience of their games, With the advancements in generative AI technology. Generative AI has the potential to create game assets like 3D assets, 3D models, sprites, and more. Furthermore, AI adapts itself to generate unique and new game assets that fit a particular style or genre, learning through existing game assets.
Procedural Content Generation Application To Boost Global Market Growth
Procedural content is one of the most significant applications of generative AI for developing gaming experiences. This refers to the generation of game content like maps, levels, and scenarios with the help of algorithms. With the help of procedural content generation, game developers can save resources and time by automating the process of creating game content.
Restraints
AI Advancement in Gaming is Threatening Jobs from Game Developers to a Concerning Extent
Generative AI advancement in gaming can threaten the jobs of game developers to a concerning extent. There will be a burden on developers to generate AI skills to survive their jobs. Also, AI could use developers’ work without permission to create content which may create new copyright issues.
Privacy Issues May Rise Due to AI
Privacy issues may arise depending on the content used to train the model. For example, one AI tool assessed the human movements of 50,000 players across 2.5 million VR data recordings for a popular VR game. With a precision of 94%, the AI creative tools uniquely identified players on demand within seconds or minutes.
Technique Analysis
The Nondeterministic Technique Segment Dominated the Market by Allowing Developers to Code Behaviors Without Knowing All Possible Outcomes
Based on technique, generative AI in the gaming market can be segmented into deterministic techniques and nondeterministic techniques. The nondeterministic technique dominated the market with the largest market share in 2022. These techniques offer developers the freedom to code behaviors without knowing all possible outcomes in advance.
Nondeterministic algorithms also can learn and extrapolate themselves, leading to emergent behavior – that is, behavior that arises without explicit instructions. Examples of emergent behavior can be seen in neural network algorithms and flocking patterns. Deterministic performance or behavior is a predictable and specified technique. These techniques place the burden of anticipating all coding, scenarios, and behavior explicitly on developers’ shoulders.
Function Analysis
The Non-Player Character (NPC) Segment Dominated The Market in 2022 Due to the Unpredictability it Offers
Based on function, the generative AI gaming market is segmented into Image enhancement, level generation, balancing in-game complexity, scenarios & stories, and non-player characters. The non-player character (NPCs) segment dominated the market in 2022 with the largest revenue share. In most latest games, the opponents are pre-programmed NPCs. However, AI helps to add intelligence to these characters. This made them more enjoyable and less predictable. Moreover, AI allows NPCs to become smarter and respond to game conditions in novel and unique ways over time.
Regenerative stories and scenarios are generated by AI in gaming. This game uses an open-source text generation system built by openAI and trained on ‘choose your adventure’. The game-level segment is also known as Procedural Content Generation. This is one of the most promising applications of artificial intelligence in game design. For generating interesting game levels, advanced AI algorithms are used to generate large open-world environments, new game levels, and many other game assets.
End-User Analysis
Game Studios Dominated The Market With its High Demand For Generative AI.
Based on end-user, the market is segmented into game studios, developers, designers, artists, and other end-users. Game studios dominated the market in 2022 with their high demand for generative AI.
Demand from gaming studios for generative AI is high because of its advanced functions like image enhancement, level generation, balancing in-game complexity, scenarios & stories, and non-player characters. Developers and designers are inclined to customize games according to users’ abilities, create new virtual characters’ worlds, and eliminate predictability.
Key Market Segments
By Technique
- Deterministic
- Nondeterministic
By Function
- Image Enhancement
- Level Generation
- Scenarios & Stories
- Balancing In-Game Complexity
- Non-Player Characters
By End-Users
- Game Studios
- Developers
- Designers
- Artists
- Other End-Users
Opportunity
Games will be More Challenging and Advanced for Players to Predict.
Generative AI in the gaming market is expected to grow faster during the forecast period with new possibilities like autonomous character evolution, adaptation, and learning. NPCs in the coming years will be able to evolve during gameplay, and predicting their behaviors will be more difficult for a player. AI-backed games will be more challenging and advanced for players to predict With increasing gameplay time. This will extend the play-life of the games.
Trends
Demand For Real-Time Generative AI
Demand for real-time generative AI is on trend in the gaming industry. Traditional AI language models are algorithmically intensive and can take lots of time to generate content in response. On the other hand, Real-time generative AI models can generate content in seconds. This has allowed developers to create more immersive and interactive gaming platform experiences by allowing for the generation of content on-the-fly.
Regional Analysis
In 2022, Asia Pacific dominated the generative AI in the gaming market with the largest revenue share of 34% and is expected to grow at the highest CAGR during the forecast period between 2023-2032. India and China are the key contributors to the region’s generative AI gaming content development efforts, driven mainly by their talent and games industry support.
Moreover, with the post-COVID boom in the gaming industry, the global video game market is projected to increase by more than 4% compared to 2021. North America holds the second-largest revenue share in 2022 and is expected to register the highest CAGR during the forecast period.
Key Regions and Countries Covered in this Report
- North America
- The US
- Canada
- Mexico
- Western Europe
- Germany
- France
- The UK
- Spain
- Italy
- Portugal
- Ireland
- Austria
- Switzerland
- Benelux
- Nordic
- Rest of Western Europe
- Eastern Europe
- Russia
- Poland
- The Czech Republic
- Greece
- Rest of Eastern Europe
- APAC
- China
- Japan
- South Korea
- India
- Australia & New Zealand
- Indonesia
- Malaysia
- Philippines
- Singapore
- Thailand
- Vietnam
- Rest of APAC
- Latin America
- Brazil
- Colombia
- Chile
- Argentina
- Costa Rica
- Rest of Latin America
- Middle East & Africa
- Algeria
- Egypt
- Israel
- Kuwait
- Nigeria
- Saudi Arabia
- South Africa
- Turkey
- United Arab Emirates
- Rest of MEA
Key Players Analysis
AI brings various benefits to game development companies. Emerging key players are focused on a variety of strategic policies to develop their respective businesses in foreign markets. Companies that use AI in their games can save budget and time.
Furthermore, businesses in generative AI in the gaming market are developing new products and portfolio expansion strategies through investments and mergers & acquisitions. In addition, several key players are now focusing on providing a better user experience and streamlining their development creative process in the Game industry.
Market Key Players
Listed below are some of the most prominent generative AI in the gaming industry players.
- ChatGPT
- Electronic Arts (EA)
- NVIDIA Corporation
- Apex Game Tools
- Procedural Arts
- AI Dungeon
- IBM
- Kata.ai
- Pyka
- Baidu
- Charisma.ai
- Latitude.io
- Other Key Players
Recent Developments
- In March 2023 – io launched a new beta Wyvern model 2.0. this model is based on a new, more intelligent foundation model from AI21. Wyvern 2.0 had a significant reduction in repetition and empty outputs.
- In March 2023- Unity Software Inc (U.N), which is a video game development environment producer, aims to open a marketplace for generative artificial intelligence (AI)
Report Scope
Report Features Description Market Value (2022) USD 922 Mn Forecast Revenue (2032) USD 7,105 Mn CAGR (2023-2032) 23.3% Base Year for Estimation 2022 Historic Period 2016-2022 Forecast Period 2023-2032 Report Coverage Revenue Forecast, Market Dynamics, COVID-19 Impact, Competitive Landscape, Recent Developments Segments Covered By Technique – Deterministic and Nondeterministic; By function – Image Enhancement, Scenarios & Stories, Level Generation, Balancing In-Game Complexity, and Non-Player Characters; By End User Game Studios, Developers, Designers, Artists, and Other End Users Regional Analysis North America – The US, Canada, & Mexico; Western Europe – Germany, France, The UK, Spain, Italy, Portugal, Ireland, Austria, Switzerland, Benelux, Nordic, & Rest of Western Europe; Eastern Europe – Russia, Poland, The Czech Republic, Greece, & Rest of Eastern Europe; APAC – China, Japan, South Korea, India, Australia & New Zealand, Indonesia, Malaysia, Philippines, Singapore, Thailand, Vietnam, & Rest of APAC; Latin America – Brazil, Colombia, Chile, Argentina, Costa Rica, & Rest of Latin America; the Middle East & Africa – Algeria, Egypt, Israel, Kuwait, Nigeria, Saudi Arabia, South Africa, Turkey, United Arab Emirates, & Rest of MEA Competitive Landscape ChatGPT, Electronic Arts (EA), Apex Game Tools, Procedural Arts, AI Dungeon, IBM, Kata.ai, Pyka, Baidu, Charisma.ai, Latitude.io, and Other Key Players Customization Scope Customization for segments, region/country-level will be provided. Moreover, additional customization can be done based on the requirements. Purchase Options We have three licenses to opt for Single User License, Multi-User License (Up to 5 Users), Corporate Use License (Unlimited User and Printable PDF) Frequently Asked Questions (FAQ)
What is the estimated CAGR of the generative AI in the gaming market between 2023 and 2032?The estimated CAGR of the generative AI in the gaming market between 2023 and 2032 is 23.3%.
What is the predicted valuation of the generative AI in the gaming market by 2032?The generative AI in the gaming market is predicted to reach a valuation of USD 7,105 Mn by 2032.
What are some of the drivers of the generative AI in gaming market?The drivers of the generative AI in gaming market include the machine learning algorithm of AI to boost the market, game asset generation, and procedural content generation application to boost the market growth.
What are some of the restraints of the generative AI in gaming market?Some of the restraints of the generative AI in gaming market include the threat of job loss for game developers and potential privacy issues.
What are the key market segments of Generative AI in Gaming Market?The key market segments of Generative AI in Gaming Market include technique (deterministic and non-deterministic), function (image enhancement, level generation, scenarios & stories, balancing in-game complexity, and non-player characters), and end-users (game studios, developers, designers, artists, and other end-users).
Who are the key players in Generative AI in Gaming Market?The key players in Generative AI in Gaming Market include ChatGPT, Electronic Arts (EA), Apex Game Tools, Procedural Arts, AI Dungeon, IBM, Kata.ai, Pyka, Baidu, Charisma.ai, Latitude.io, and other key players.
Generative AI in Gaming MarketPublished date: March 2024add_shopping_cartBuy Now get_appDownload Sample - ChatGPT
- Electronic Arts (EA)
- NVIDIA Corporation
- Apex Game Tools
- Procedural Arts
- AI Dungeon
- International Business Machines Corporation Company Profile
- Kata.ai
- Pyka
- Baidu
- Charisma.ai
- Latitude.io
- Other Key Players
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