VR, NFT and Metaverse didn’t take over video games, nor will AI

Stop me if you’ve heard this before. A new technology has come out that secures billions in funding, and is set to disrupt the entire video game industry.

The latest technology to make this case is AI, the buzzword of 2023, originally rooted in projects like ChatGPT and Midjourney, but now extended to…literally every company that says they’re going to use AI in some way, no matter how frivolous it is.

And yet I’ve been too long and been down this road too many times to believe the hype this time. Sure, AI can do some cool things, but the exact same language I’m hearing here is what we’ve heard about a wide variety of other technologies, which essentially didn’t deliver as promised.

VR

Yes, a VR market currently exists. No, it’s not huge compared to the wider industry, and no, we’re not about to switch to VR as the main way to play games. Once heralding the future of gaming when the Oculus Rift first came out in 2016, it was predicted that the VR market would scale to hundreds of billions of dollars and be the primary way we played games within 5, 10 years. We’re approaching year 10 here, and now we’re debating whether the Meta is just going to live up to its VR ambitions and whether PSVR 2 is actually going to outsell PSVR 1.

Sure, there are VR enthusiasts, and tens of millions of VR headsets have been sold. I own two of them, and yet they’ve been sitting in my closet for years now after maybe a few dozen hours of play, compared to the few thousand hours I’ve sunk into the PC and consoles. VR didn’t “fail” per se, but it didn’t live up to its extraordinary hype, and won’t anytime soon.

NFTs/web3

There was once a bunch of crypto bros and VCs who know very little about video games the idea that NFTs, unique digital items that can be sold in a game, would be the next big form of microtransaction and be a huge source of revenue for the gaming industry forwards.

And then they kept talking, saying things like you’d have the ability to transfer these items between games, which every developer said was extremely stupid. The industry still went ahead and dipped their toe into this concept with things like the Ubisoft Ghost Recon NFTs and were immediately zapped. Square Enix’s president is routinely mocked for being the only major gaming figure besides Dr. Disrespect still pitching NFTs and blockchain games. Everyone else has abandoned the concept.

Actual blockchain games do exist, but they are scandalously terrible, just deeply terrible games that sure could have generated some money at the height of this gamer craze, but disappeared quickly (hello Axie Infinity) and all that’s left is relative garbage like the Bored Ape game that fleeces players into and flushes out thousands of dollars for “sewer passes” and other nonsense. All others in actual the gaming industry has fled the blockchain.

The Metaverse

I don’t really even need to write this part because Ed Zitron wrote it for me with an awesome Business Insider article you need to read. The collapse of the Metaverse is profoundly obvious given that no one even wants it say the word in 2023 that everyone in technology was screaming about in recent years.

There were really only two ideas about the Metaverse. First was Mark Zuckerberg’s, who he heralded as the future of humanity to the point where he renamed his entire company (which I guess he now regrets). But his idea was married to VR, which, as we’ve established, is far from mainstream adoption. He also decided to spend worst VR experience on the planet, Horizon Worlds, as the flagship of the concept, a product so bad that even Meta employees had to be forced to log on to it by their bosses. Now the users plunge and guess what he resorts to? AI.

The other Metaverse was surprisingly related to the other thing, web3, NFTs and the blockchain. This was the version where you read about Macy’s and Disney and the one that bought up virtual real estate in extremely empty meta-dysoptics like Decentraland or The Sandbox, “games” that had lower concurrent player counts than the first 300 or so titles on Steam. This was nothing. There was always nothing, and actual video games did this better, creating virtual worlds and communities of millions of players long before anyone in tech thought they had invented this idea and given it a name they stole from Neal Stephenson.

AI

So yeah, you’ll forgive me if I’m skeptical of this idea that AI is going to come in and hit the gaming industry like a meteor. Yes I is actually more impressed with the technology than I was with the last three things on this list. And yet these largely predictive, far from “intelligent” AIs are clearly being overhyped. No, I don’t think game concept artists will be replaced by Midjourney. No, I don’t think narrative teams will be replaced by ChatGPT. No, I don’t think a company called “ChatGPT of AAA games” is going to let you design your own Fortnite in seconds.

Are there aspects of AI that can be used in game development? Sure, and it’s probably more useful than the other technology on this list. But this idea that AI is going to completely rewrite the rules of game development and how we interact with games is simply not going to happen, and anyone who thinks the next GTA is going to come out of a predictive text or (stolen) art generator is deeply out of touch with reality in the industry. But of course it is nothing new.

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