[STEAM] Google's Project Genie Seemingly Causes Some Investors to Lose Faith in Roblox, Unity and...GTA 6

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Just one day after the announcement of Genie,

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's generative AI-powered virtual world creator, a number of major video game companies are seeing their stock prices tumble, seemingly because some investors think you can just generate an entire video game with AI now.

Of course, that's not what Genie is. Genie essentially lets you create a virtual "world" by offering prompts to describe the environment, a main character, and first or third-person view. Once it's created, you can control the described character and wander around the world you've made.

And that's...kind of it? While you can walk around these virtual spaces with your keyboard, critically, there's nothing else you can really do. There are no game mechanics, there's no one to talk to, no goals, no scores or meaningful interactions. Additionally, each generation is limited to just 60 seconds. And while you could maybe argue that this is just the first step on a road to eventually getting AI to generate playable 3D video games, there's no real evidence yet that such a thing is possible, or that the games would be good or even coherent.

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, for instance, tried to basically copy Breath of the Wild using Genie, and while they got something that essentially looks identical, that's just it. It's not playable, the "Link" looks kind of frightening actually, and Genie had to copy something that already existed to make this. It didn't come up with this on its own.

But that hasn't really stopped a lot of investors from suddenly jumping off the video game train, a conclusion first posed by

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and shared by others, including

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. Perhaps the most notable decline is Take-Two Interactive, which reached a six-month low this morning and, while it rallied somewhat by the closing bell, still ended down 8%. Engine maker Unity is in a similar spot, dropping 24% today also to a six-month low. Roblox stock also cratered today by 13% by close today, though notably Roblox has been on a downward trend since November. Still, it's a six-month low for Roblox, too.

Not every gaming company is seeing a massive nosedive. Ubisoft is technically down 7% today, but with its stock down to just $1/share, any small movement in either direction will seem significant. The company has been in pretty dire straits for months, even years now, and its announcement of more layoffs, closures, and cancelations earlier this month already had stock even further in a downward spiral. EA stock hasn't changed much today at all, but that's understandable, given EA announced last fall that

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to an investor group headed up by the Saudi Arabian government and will soon exit the public trading market. Meanwhile, Nintendo stock, down just under 5% today at the time this piece was written, has been all over the place all month, following a steady downward trend since November.

The pattern I'm seeing here between Take-Two, Roblox, and Unity is a sudden distrust not in games as an idea, but rather concerns about "platforms". Unity is a game engine. People use it to make games. If Genie can also make games, who needs Unity? In Roblox's case, Roblox is a pure user-generated content (UGC) factory - something that would likely become obsolete quickly if Genie took over. And for Take-Two, the publisher is about to release Grand Theft Auto VI later this year (we hope), which would very likely be accompanied at launch or not long after with some new version of GTA Online. While the current GTA Online doesn't rely on UGC, there have been

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. Again, the thinking here is seemingly that if people can just make their own little games in Genie, why would they bother doing it in Roblox or GTA or Minecraft or Fortnite or Unreal or anywhere else (

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, for its part is too big to see any stock impact from Genie today and Epic Games is not publicly traded).

Is selling shares of major game publishers going to pay off for these investors? I'm not a stock expert, but if nothing else, it doesn't seem to be like a good idea to bet against GTA 6 right now (though Take-Two's earnings are next week, so we'll see I guess). And while Genie doesn't seem up to the task of making a whole video game out of nothing,

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of other

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are

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on

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or the other on using generative AI of any kind in their work. It seems that one way or another, the folks betting big money on generative AI will reap whatever harvest of that investment there is sooner rather than later.

Rebekah Valentine is a senior reporter for IGN. Got a story tip? Send it to [email protected].

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