What You Missed This Week in Video Games

Square Enix to actively push into generative AI in 2024

“Game On” is The Fly’s weekly recap of the stories powering up or beating down video game stocks.

SQUARE ENIX AI: 

Square Enix (SQNXF) president Takashi Kiryu said that the game maker will be actively pushing into the generative AI field in 2024 and looking into ways it can be used in the company’s internal games development, Gamesindustry.biz’s James Batchelor reported. In the “Final Fantasy” maker’s annual New Year’s Letter, Kiryu said that the rise of ChatGPT in 2023 “made it apparent that the applicability of generative AI was by no means limited to text,” the author noted.

“I believe that generative AI has the potential not only to reshape what we create, but also to fundamentally change the processes by which we create, including programming,” he added. “In the short term, our goal will be to enhance our development productivity and achieve greater sophistication in our marketing efforts,” he continued. “In the longer term, we hope to leverage those technologies to create new forms of content for consumers, as we believe that technological innovation represents business opportunities.”

MICROSOFT/CMA: 

Microsoft (MSFT) president Brad Smith said on a radio interview that the U.K.’s Competition and Markets Authority was “tough and fair” when it came to the Xbox maker’s takeover of Activision Blizzard last year, The Verge’s Tom Warren reported. Smith had previously expressed frustration over the CMA initially blocking the transaction, forcing Microsoft to restructure the deal.

“I certainly learned a lot personally,” Smith said on BBC Radio 4. “I wouldn’t step back necessarily from all of the concerns I raised when I talked way back in April, but I might choose slightly different words to make my point.”

JEFFERIES ON CHINA GAMING: 

Jefferies said in a note last week that it believes market concerns over a crackdown of China’s gaming sector are overdone. The National Press and Publication Administration provided more updates on the rationale for the draft proposals, which include fostering prosperous and healthy sector development, encouraging development of original quality games, international co-operations and rewards for those with significant contributions, details on the requirements for those entering the gaming sector, and minor and gamer protections, the analyst tells investors in a research note. The firm believes the further comments from NPPA together with the ongoing game approvals address market concerns of a sector crackdown. Meanwhile, Jefferies particularly noted that the share price correction in Tencent (TCEHY) last week was an “overreaction.”

NINTENDO ONLINE PLAY: 

Nintendo (NTDOY) has started the curtailment of the Wii U and 3DS’s ability to play online, earlier than the April time period it originally estimated, Lawrence Bonk wrote for Engadget. The process, according to Engadget, began prior to Christmas Eve, and follows the console maker’s termination of “its 3DS and Wii U eShops back in March.”

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Originally Posted January 2, 2024 – What You Missed This Week in Video Games