Can AI Make Video Games More Immersive? Some Studios Turn to AI-Fueled NPCs for More Interaction

The AI (Artificial Intelligence) letters and robot hand are placed on computer motherboard in this illustration taken, June 23, 2023. (Reuters)
The AI (Artificial Intelligence) letters and robot hand are placed on computer motherboard in this illustration taken, June 23, 2023. (Reuters)
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Can AI Make Video Games More Immersive? Some Studios Turn to AI-Fueled NPCs for More Interaction

The AI (Artificial Intelligence) letters and robot hand are placed on computer motherboard in this illustration taken, June 23, 2023. (Reuters)
The AI (Artificial Intelligence) letters and robot hand are placed on computer motherboard in this illustration taken, June 23, 2023. (Reuters)

For decades, video games have relied on scripted, stilted interactions with non-player characters to help shepherd gamers in their journeys. But as artificial intelligence technology improves, game studios are experimenting with generative AI to help build environments, assist game writers in crafting NPC dialogue and lend video games the improvisational spontaneity once reserved for table-top role-playing games.

In the multiplayer game “Retail Mage,” players help run a magical furniture store and assist customers in hopes of earning a five-star review. As a salesperson — and wizard — they can pick up and examine items or tell the system what they'd like to do with a product, such as deconstruct chairs for parts or tear a page from a book to write a note to a shopper.

A player’s interactions with the shop and NPCs around them — from gameplay mechanics to content and dialogue creation — are fueled by AI rather than a predetermined script to create more options for chatting and using objects in the shop.

“We believe generative AI can unlock a new kind of gameplay where the world is more responsive and more able to meet players at their creativity and the things that they come up with and the stories they want to tell inside a fantasy setting that we create for them,” said Michael Yichao, cofounder of Jam & Tea Studios, which created “Retail Mage.”

The typical NPC experience often leaves something to be desired. Pre-scripted interactions with someone meant to pass along a quest typically come with a handful of chatting options that lead to the same conclusion: players get the information they need and continue on. Game developers and AI companies say that by using generative AI tech, they aim to create a richer experience that allows for more nuanced relationships with the people and worlds that designers build.

Generative AI could also provide more opportunities for players to go off-script and create their own stories if designers can craft environments that feel more alive and can react to players' choices in real-time.

Tech companies continue to develop AI for games, even as developers debate how, and whether, they’ll use AI in their products. Nvidia created its ACE technologies to bring so-called “digital humans” to life with generative AI. Inworld AI provides developers with a platform for generative NPC behavior and dialogue. Gaming company Ubisoft said last year that it uses Ghostwriter, an in-house AI tool, to help write some NPC dialogue without replacing the video game writer.

A report released by the Game Developers Conference in January found that nearly half of developers surveyed said generative AI tools are currently being used in their workplace, with 31% saying they personally use those tools. Developers at indie studios were most likely to use generative AI, with 37% reporting using the tech.

Still, roughly four out of five developers said they worry about the ethical use of AI. Carl Kwoh, Jam & Tea's CEO, said AI should be used responsibly alongside creators to elevate stories — not to replace them.

“That’s always been the goal: How can we use this tool to create an experience that makes players more connected to each other?” said Kwoh, who is also one of the company’s founders. “They can tell stories that they couldn’t tell before.”

Using AI to provide NPCs with endless things to say is “definitely a perk,” Yichao said, but "content without meaning is just endless noise." That's why Jam & Tea uses AI — through Google's Gemma 2 and their own servers in Amazon — to give NPCs the ability to do more than respond, he said. They can look for objects as they’re shopping or respond to other NPCs to add “more life and reactivity than a typically scripted encounter.”

“I’ve watched players turn our shopping experience into a bit of a dating sim as they flirt with customers and then NPCs come up with very realistic responses,” he said. “It’s been really fun to see the game react dynamically to what players bring to the table.”

Demonstrating a conversation with an NPC in the game “Mecha BREAK,” in which players battle war machines, Ike Nnole said that Nvidia has made its AI “humans” respond faster than they previously could by using small language models. Using Nvidia's AI, players can interact with the mechanic, Martel, by asking her to do things like customize the color of a mech machine.

“Typically, a gamer would go through menus to do all this,” Nnole, a senior product marketing manager at Nvidia said. “Now it could be a much more interactive, much quicker experience.”

Artificial Agency, a Canadian AI company, built an engine that allows developers to bring AI into any part of their game — not only NPCs, but also companions and “overseer agents” that can steer a player towards content they’re missing. The AI can also create tutorials to teach players a skill that they are missing so they can have more fun in-game, the company said.

“One way we like to put it is putting a game designer on the shoulder of everyone as they’re playing the game,” said Alex Kearney, cofounder of Artificial Agency. The company’s AI engine can be integrated at any stage of the game development cycle, she said.

Brian Tanner, Artificial Agency's CEO, said scripting every possible outcome of a game can be tedious and difficult to test. Their system allows designers to act more like directors, he said, by telling characters more about their motivation and background.

"These characters can improvise on the spot depending on what’s actually happening in the game,” Tanner said.

It's easy to run into a game's guardrails, Tanner said, where NPCs keep repeating the same phrase regardless of how players interact with them. But as AI continues to evolve, that will change, he added.

“It is truly going to feel like the world’s alive and like everything really reacts to exactly what’s happening," he said. “That’s going to add tremendous realism.”



France's Top Court Blocks Social Media Ban for under-15s

(FILES) This photograph shows a set up smart-phone screen displaying the logo of main social media platforms including Instagram, Facebook, LinkedIn, Reddit, Telegram, X, Bluesky, Tiktok and Whatsapp in Saint-Mande, east of Paris, on April 29, 2026. On August 14, 2026, the French Constitutional Council struck down the ban on social media for under-15s, ruling that this measure constitutes "a disproportionate infringement" of their freedom of expression. (Photo by Martin LELIEVRE / AFP)
(FILES) This photograph shows a set up smart-phone screen displaying the logo of main social media platforms including Instagram, Facebook, LinkedIn, Reddit, Telegram, X, Bluesky, Tiktok and Whatsapp in Saint-Mande, east of Paris, on April 29, 2026. On August 14, 2026, the French Constitutional Council struck down the ban on social media for under-15s, ruling that this measure constitutes "a disproportionate infringement" of their freedom of expression. (Photo by Martin LELIEVRE / AFP)
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France's Top Court Blocks Social Media Ban for under-15s

(FILES) This photograph shows a set up smart-phone screen displaying the logo of main social media platforms including Instagram, Facebook, LinkedIn, Reddit, Telegram, X, Bluesky, Tiktok and Whatsapp in Saint-Mande, east of Paris, on April 29, 2026. On August 14, 2026, the French Constitutional Council struck down the ban on social media for under-15s, ruling that this measure constitutes "a disproportionate infringement" of their freedom of expression. (Photo by Martin LELIEVRE / AFP)
(FILES) This photograph shows a set up smart-phone screen displaying the logo of main social media platforms including Instagram, Facebook, LinkedIn, Reddit, Telegram, X, Bluesky, Tiktok and Whatsapp in Saint-Mande, east of Paris, on April 29, 2026. On August 14, 2026, the French Constitutional Council struck down the ban on social media for under-15s, ruling that this measure constitutes "a disproportionate infringement" of their freedom of expression. (Photo by Martin LELIEVRE / AFP)

France's top court on Friday blocked a bill banning social media access for under-15s, saying it infringed upon freedom of expression, a setback for President Emmanuel Macron who asked his government to rewrite the legislation.

"By prohibiting minors under the age of fifteen from accessing certain online services, the law inherently requires every person, even an adult, to prove their age before accessing them," the Constitutional Council said in its decision.

"However, by failing to specify the conditions and limits under which such proof must be provided, the legislature has not established the legal safeguards necessary to ensure compliance with these requirements," it added. French lawmakers had approved a ban on social media access for children under age 15, becoming the first in Europe to follow Australia, whose world-first ban barred access to platforms including Facebook, TikTok and YouTube for under-16s in December.

Macron has ordered Prime Minister Sebastien Lecornu to re-work the draft legislation to take the Constitutional Council's concerns into account, the Elysee said in a statement.

The Elysee said Macron was determined the reform take effect before spring 2027, when France holds a presidential election. Macron cannot run for a third term.


China’s Lenovo Posts 43% Jump in Q1 Revenue, Highest in Five Years

The Lenovo logo is seen in this illustration photo January 22, 2018. (Reuters)
The Lenovo logo is seen in this illustration photo January 22, 2018. (Reuters)
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China’s Lenovo Posts 43% Jump in Q1 Revenue, Highest in Five Years

The Lenovo logo is seen in this illustration photo January 22, 2018. (Reuters)
The Lenovo logo is seen in this illustration photo January 22, 2018. (Reuters)

China's Lenovo Group reported a 43% jump in quarterly revenue on Thursday, beating forecasts and sending shares of the world's largest computer maker surging, as it rides an AI hardware boom and reaps the benefits of a global memory chip shortage.

Lenovo's revenue rose to $26.94 billion in the three months ended June 30, beating analyst expectations of $22.3 billion, as the consumer electronics hardware giant benefited from artificial intelligence-driven demand and solid PC sales.

It was ‌the group's highest ‌quarterly revenue growth in the last five years, as ‌AI-related ⁠revenue grew 60% ⁠year-on-year to $9.3 billion, accounting for 35% of total revenue in its fiscal first quarter.

The company swung to a net loss attributable to shareholders of $609 million from a profit of $505 million last year, compared to the average analyst estimate of $589 million profit, according to data compiled by LSEG.

The company said the loss was primarily due to a non-cash fair value loss of US$1.7 billion arising ⁠from the revaluation of warrants issued in 2025.

Lenovo's shares hit ‌an all-time high on Thursday before ‌the results announcement, bringing its year-to-date gains to 225%. The shares surged as much as ‌17% after the results announcement.

Its US competitors Dell, Hewlett Packard and Super ‌Micro have been some of Wall Street's best performers this year but have raised prices by 10% to 30% due to soaring NAND and DRAM memory chip costs.

Lenovo's PC, tablet and smartphone division, which accounted for about 64% of total revenue, ‌reported a 27% year-on-year increase in revenue during the period. Adjusted net income, which excludes one-off items and non-cash charges, ⁠more than doubled ⁠to $1.075 billion.

R&D expenses jumped 30% year-on-year, the company said.

Global PC shipments declined by 2% year-on-year in the second quarter of 2026 to 16.6 million units for the first time since Q1 2025 due to memory-driven cost pressures, according to Counterpoint Research.

Lenovo retained its market lead in the second quarter, giving it a market share of 25.6%. Its AI server pipeline reached $54.0 billion, up 157% quarter-over-quarter, reflecting demand from hyperscalers, AI cloud and enterprise AI clients, its earnings report said.

Lenovo's strong performance comes after the company warned earlier this year of pressure on PC shipments as the industry grapples with a memory chip shortage that is getting more severe.

It has also raised PC prices to mitigate the impact of soaring memory costs.


Brazil Demands Safety Controls on Discord After Livestreamed Suicide

The Discord logo is seen in this illustration taken November 7, 2022. (Reuters)
The Discord logo is seen in this illustration taken November 7, 2022. (Reuters)
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Brazil Demands Safety Controls on Discord After Livestreamed Suicide

The Discord logo is seen in this illustration taken November 7, 2022. (Reuters)
The Discord logo is seen in this illustration taken November 7, 2022. (Reuters)

Brazilian authorities are calling on US-based messaging platform Discord, popular among teens, to take action after a suicide case sparked outcry and the first lady called for its shutdown.

Investigators say a 13-year-old girl was encouraged to self-harm and take her own life during a Discord livestream, and five teenagers have been arrested in connection to the death.

The office of the Attorney General of the Union (AGU), a public body that defends the legal interests of the Brazilian state, told AFP on Tuesday it requested and has received a proposal from Discord to "adopt measures aimed at strengthening the safety of its users, particularly children and adolescents."

In a statement sent to AFP, Discord said it was "cooperating with authorities in the investigation into this serious case."

Discord said it had additionally "deactivated, before the teenager's death," a "private server" suspected of being used by "individuals involved in criminal activities encouraging self-harm."

The AGU has demanded concrete measures, like age verification of users.

In Brazil, a law that came into effect earlier this year obliges platforms to link the accounts of users under age 16 to their parents' accounts, and requires platforms to verify user age.

Following the recent death, Rosangela da Silva, wife of left-wing President Luiz Inacio Lula da Silva, called for Discord to be shut down and urged "the judiciary to remove this horrible network from the Internet."

Discord claims more than 90 million active daily users worldwide.

In 2024, the platform X was blocked for 40 days in Brazil, until the social media network owned by the world's richest man Elon Musk complied with the Supreme Court's orders to remove accounts spreading disinformation.