I'm very much in favor of using generative chat to provide the kind of background hum a virtual world needs to feel convincing. I used to really like the ambient chatter in the original Baldur's Gate and Guild Wars 2 but if you spend too long in one area, as happens with cities and hubs that provide services, after a while the speech samples became very repetitive. It would be far better to have them spontaneously generated by AI.

The whole "who gets paid" aspect is inevitably going to get ironed out over time as it has with every previous technological invention since at least the first industrial revolution so it's not a matter of "if" but "when". The only thing that would stop it would be the kind of mass public aversion such as we saw with both Google Glass and NFT/P2E but the reactions to AI are much more on the "some people love it, some people hate it" end of the scale and when public opinion splits like that, companies will always go for the most profitable option, which is defnitely going to be using AI not standing out against it.
 

I dont see this being feasible for background NPCs in the way you describe it. I could see LLM being used to create more pieces of non essential dialogue that are then used for NPCs but actually running some sort of chat bot in game wouldn't be worth the resource cost. Not to mention it would need an always online connection which is still an issues for many people.

Personally I'd rather see generative AI used to improve procedurally created content. Games are still very far away from having procedurally created content that rivals hand-built content and it really shows. Generative AI tools could be a game changer for developers.
 

You might be able to make a compressed set of weights that doesn't know much about anything except in-game stuff, and small enough to run locally at conversation speed (if it's tight, show a chat screen and borrow the GPU for the duration). I don't know enough about the tech to be certain that is feasible, but it seems like it might be.
 

We have seen studios attempting this since at least Skyrim. However, I suspect we are almost to the point where it really could be done in a compelling way. That said, we aren't there yet if AI can't even be relied upon to write a simple obituary yet . . .

https://futurism.com/msn-ai-brandon-hunter-useless
 

But that wasn’t a large language model AI like ChatGPT, but a much simpler software that steals articles from other websites and then runs them through a much simpler algorithm that uses a Thesaurus and rearangement to hide the theft. Teachers were reporting pupils using similar software for essays long before ChatGPT was released, leading to pearls like “Unused York City”.
 

I think this is inevitable, and we're on the verge of it becoming viable. It's gonna take another generation or two of open source LLM improvements and consumer hardware upgrades to make this possible on an average gaming PC at a reasonable generation speed. Current local LLM response times are still far too slow for most gaming conversations.

We should start seeing commercialized experiments appear in this area in the next couple of years. Whether this will become widespread in the gaming industry is debatable. AI has never been a strong area for game developers to invest in. Many techniques exist that strategy games and such would benefit from, but very few ever get used. I never cease to be disappointed by the state of AI in the vast majority of even AAA games.
 

How much cooler would it be if you couldn’t find out about the murdered traveller unless you actually asked about him?

Are you looking for Mankrik's wife?