The push to utilize generative AI across entertainment isn’t sparing the ever-complex video games industry by any means.

With the Game Developers Conference underway this week, Griffin Gaming Partners managing director and co-founder Peter Levin joined Variety Intelligence Platform president Andrew Wallenstein and media analyst Kaare Eriksen on Variety’s “Strictly Business” podcast and wasted no breath expressing the urgency with which AI tech is top of mind for the business and development sides of gaming alike.

“I think we’re gonna continue to see a bunch of conversations around AI, its impact on games development, its impact on the picks-and-shovels businesses in and around games development,” said Levin.

Extensive layoffs throughout the global gaming industry are ongoing for more than a year now as major publishers and gaming divisions within larger entertainment companies have gotten aggressive with cost-cutting measures. Concern over AI is mounting among game developers hoping for job prospects to lighten and for stability to come, but Levin sees the embrace of AI as integral to gaming’s future.

“It’s an optimal time to be a developer or publisher and bake in the AI functionality within your product roadmap,” said Levin. “If they’re not crazy about it, that’s going to happen with or without their sentiment.”

“I say this gently and lightly and [am] certainly not celebrating the eradication of anyone’s jobs,” Levin added. “But gaming, traditionally, has been much more akin to enterprise software with respect to recognizing when they need to trim the fat.”

AI tech has long been part of the development process and gaming experience across traditional titles, whether for programming enemy NPCs or aiding in procedural generation of player environments, but newer interest in AI in the gaming space has lately revolved around generating content entirely from scratch, utilizing existing assets for UGC purposes and plotting more efficient release strategies.

“Some of the ways we’re very excited about the practical application of AI are manifesting in things like customer acquisition, the ability to lever which social media platforms, for example, are the best environments within which to market to a certain customer,” said Levin.

Despite the industry’s headwinds, the oncoming launches of Nintendo Switch 2 and “Grand Theft Auto 6” in 2025 have Levin excited, as do emerging markets for games outside of North America and Europe, where smartphone proliferation continues to power the mobile games sector.

“You’ve got the telco players, whether that’s the Mittals [Bharti Airtel] or the MTNs or the Vodafones,” said Levin. “They’re looking at what some of the other carriers have done in markets like North America, where they’ve left a lot of money on the table… These carriers really don’t participate in these markets, in the economics, you’ve got Google gobbling up and you’ve got, obviously, Apple and iOS gobbling up their share.”

“At some point, these [U.S.] carriers become self-commoditizing big fat pipes, and that’s a mistake that I think in a lot of emerging markets they would like to fix,” Levin said. “So they’re going to invest directly into content. They want more skin in the game. They want a more intimate relationship with that consuming demographic.”

Levin continued: “You see a lot of expats in emerging markets, and I think that’s one way to address the opportunity. But at some point you have to have local talent. It’s less expensive. They understand not just the localization of content, but the culturalization of content, which is a much harder needle to thread.”

As for Hollywood’s involvement in gaming, Levin praised Remedy Entertainment’s deal with Annapurna Pictures to fund development for “Control 2” in exchange for exclusive film and TV rights to “Control” and “Alan Wake” as a “great example of thinking outside of the box.”

Levin is also excited for the prospects of games at Skydance, should its deal to acquire Paramount Global go through. “Hopefully when David Ellison and [Skydance] close on Paramount… I think they’re gonna have a much different orientation towards gaming,” said Levin. “They’re gonna have a longer runway to play with.”

“Strictly Business” is Variety’s weekly podcast featuring conversations with industry leaders about the business of media and entertainment. (Click here to subscribe to our free newsletter.) New episodes debut every Wednesday and can be downloaded at Apple Podcasts, Amazon Music, Spotify, Google Play, SoundCloud, more.