Tim Sweeney on UE6, AI, and Game Industry Struggles — Full T

[00:00] IGN caught up with founder and CEO of

[00:02] Epic Games, Tim Sweeney, and EVP of

[00:04] development, Marcus Wasmer, at Unreal

[00:06] Fest 2026. We talked about performance

[00:08] optimization with the upcoming UE6 and

[00:10] how it could change game development, as

[00:12] well as the increasing cost of hardware

[00:13] and the current struggles across the

[00:15] games industry with studio closures and

[00:17] game shuttering. We also discussed the

[00:19] controversial use of AI in game

[00:21] development when it comes to artistic

[00:22] value and its real world impact in light

[00:24] of Unreal Engine's updated AI tools. So

[00:27] many of the biggest games are built on

[00:29] Unreal, so check out our recaps of the

[00:31] state of Unreal keynote to see where

[00:32] games are going in the future as you

[00:34] stick with IGN. Now, here's our

[00:36] interview.

[00:46] I think it's two things like one as you

[00:48] say just like efficiency of of

[00:50] development like games are getting

[00:52] bigger, games are you know getting more

[00:54] difficult. So like all the architectural

[00:56] work we're doing on the engine should

[00:58] just smooth things out. Not to mention

[01:01] um you know like AI creation flows. We

[01:03] showed some demos today. Uh you know

[01:06] really should take a lot of the tedium

[01:07] out of of game creation. Let people just

[01:09] actually focus on the creative part

[01:11] which which would be really nice. Uh,

[01:13] and then the really cool thing will be

[01:14] the uh I think we're kind of inventing a

[01:16] new kind of economy here hopefully with

[01:18] the interconnected interoperable assets

[01:21] like between games which I think is uh I

[01:24] don't know if it's never been done but I

[01:26] haven't I haven't seen it done at scale

[01:27] at least anyway but

[01:29] yeah I'm really looking forward to the

[01:31] increased simplicity. Yeah, I wrote the

[01:33] first generation Unreal Engine and with

[01:34] every generation out of necessity of

[01:37] taking advantage of new features of

[01:39] hardware and um expanding the engine's

[01:42] capabilities, we we've made the engine

[01:44] progressively more and more complicated

[01:46] with every generation to the point where

[01:48] it's like somewhat daunting to open up

[01:49] Unreal Engine 5 and look at the you know

[01:52] five level manested uh menus in some

[01:55] cases. Um, and the C++ programming model

[01:58] really requires expert level programming

[02:01] that the great cleanup in Unreal Engine

[02:04] 6 is to adopt diverse scripting language

[02:07] that we've been pioneering in Fortnite

[02:09] um with the Fortnite creator community

[02:11] and bring that into UE6 as the primary

[02:13] way to develop game gameplay code. So it

[02:16] brings the ease of uh development of you

[02:19] know an ease of programming that you

[02:20] have in an engine like Unity or God um

[02:24] together with the full power of of UE6

[02:27] um you know all the high-end AAA feature

[02:30] sets and to tame um you know complexity

[02:32] of the engine the ability to prompt a

[02:35] lot of different systems and you know

[02:37] have it help you create a particle

[02:39] system and tweak it um enable you to

[02:41] focus on on the the details that really

[02:43] matter rather than the boiler plate of

[02:45] creating and you know you redoing the

[02:48] same road actions over and over is going

[02:50] to be really freeing. Um yeah, I think

[02:53] it'll bring back some of the magic that

[02:54] we had in earlier days and some of the

[02:56] magic that each engine had in its like

[02:58] first few years before each engine grew

[03:00] more complex is that it just of making

[03:03] it really easy to create stuff and you

[03:04] know giving the the user an immense

[03:06] amount of creative freedom and the

[03:07] feeling that they can exercise it pretty

[03:10] easily without going off and spending

[03:12] you know hours or or days on tutorials

[03:15] and learning.

[03:21] I mean, I think we've I think we've

[03:23] actually been addressing it through 57

[03:25] and 5'8 even. Uh, and I think the trend

[03:27] will continue through six, you know,

[03:29] like we're a game developer, too. Um,

[03:31] you know, Fortnite players have the same

[03:32] issues as anyone else. And, you know, we

[03:35] try to scale uh, you know, from mobile

[03:37] all the way into high-end PC. So you see

[03:38] initiatives we have like uh you saw

[03:40] lumen light on stage uh you know as an

[03:42] effort to like kind of bring the cost of

[03:44] of of lumen down to be accessible to

[03:46] more people for global dynamic

[03:48] illumination. Uh we were showing off you

[03:50] know mesh terrain where you can see

[03:52] where new features we're building. Uh

[03:54] you know that thing is built inherently

[03:56] to scale from nanite to non-nanite

[03:58] platform. So like when it when it cooks

[04:00] down for a non-an platform, it it just

[04:02] cooks down to regular meshes uh that

[04:04] should run, you know, really efficiently

[04:05] and more efficiently than the old uh

[04:07] landscape system in in most cases. Uh so

[04:09] it's really on our mind. I think you can

[04:11] see, you know, games lag a little bit in

[04:13] in shipping on engine releases, but as

[04:16] more games kind of hit that 57 and 58

[04:18] mark, I think you'll already see a trend

[04:20] uh toward toward um efficiency and then

[04:24] just like I don't know, we have a ton of

[04:26] stuff in the pipe uh as we progress

[04:28] towards UE6 and that's going to land in

[04:30] the engine as well.

[04:31] >> Yeah, it's the cumulative set of

[04:32] optimizations that have been done. Um,

[04:34] we've, you know, Fortnite back on

[04:36] mobile, we're putting a lot of effort

[04:38] into optimizing, um, the engine for, you

[04:40] know, so that a developer can ship a

[04:42] game and run on everything from the

[04:44] highest end hardware all the way down

[04:45] to, you know, low-end Android and

[04:48] several year old iPhones. And we we've

[04:50] also come to an increasing appreciation

[04:52] over time of the need to make the engine

[04:54] automatically scale uh much more of the

[04:56] content in the game. Um, you know, it's

[04:58] always been the case that with enough

[05:00] effort and um, you know, trickery a

[05:02] developer could make their game run well

[05:03] on on low-end devices, um, but the more

[05:06] our systems like Nanite can

[05:07] automatically scale, the better. Um, and

[05:09] that's going to be a source of ongoing

[05:10] attention.

[05:12] >> Yeah. And I think on top of that, just

[05:13] even more directly, like I think we're

[05:15] going to continue to see um, just like

[05:18] small teams being able to punch above

[05:19] their weight. you take a look at like,

[05:21] you know, Clare Obscure and and just a

[05:23] day um you know, no law getting shown

[05:26] off like really small teams doing really

[05:27] really impressive stuff. I I think

[05:29] you're only going to see that that trend

[05:31] kind of accelerate as we go towards the

[05:32] the U6 era.

[05:40] Well, it's an unfortunate and completely

[05:42] unexpected event um that AI would surge

[05:46] so much and to uh place so much

[05:49] competitive pressure on memory prices

[05:50] and everything. Um to the point where

[05:52] it's you know affecting significantly

[05:54] affecting cost of gaming hardware. Um I

[05:57] think it's a temporary effect but it is

[05:59] like temporary over the next 2 or 3

[06:01] years. Um, I'm sure throughout Asia

[06:04] there are massive fabs being built to

[06:06] manufacture memory at scales that will

[06:08] eventually relieve the supply pressure.

[06:10] In the meantime, we're going to have to

[06:12] be judicious um, and, you know, spend

[06:15] more time optimizing and less uh,

[06:18] knowing that we can count less on

[06:19] Moore's law to uh, solve our problems

[06:21] for us as, uh, the game industry uh,

[06:24] like has always done um, with or without

[06:27] an intention.

[06:33] I I think its role is as as a helper

[06:35] where it's useful, right? Like you go

[06:39] look back at codegen tools back in last

[06:40] November, they kind of weren't that

[06:42] great. Like now they're pretty good,

[06:44] right? So you can you can pretty easily

[06:46] um put them into engineering pipelines,

[06:49] right? I I think the main thing is uh

[06:51] you know you want to make sure to

[06:54] use AI to reduce all of the tedium all

[06:57] the tedious tasks like I I don't know

[06:59] like you don't need an engineer to go

[07:02] and spend half a day doing root cause

[07:04] analysis on a crash if you can you know

[07:06] h have a thing do that for you for 20

[07:09] minutes uh and then tell them what's

[07:10] going on and they can spend that time

[07:12] optimizing the engine instead or like

[07:14] helping a content creator or whatever.

[07:16] So I think it's it's horses for courses

[07:19] and um there'll be places where it's not

[07:22] useful, there'll be places where it

[07:23] won't.

[07:24] >> Yeah. You know, the whole space is

[07:25] moving so fast. Uh we early on

[07:27] recognized that like Epic should just

[07:30] broadly enable everybody to use the

[07:32] tools they prefer and to plug them into

[07:34] Unreal Engine in any way they want. Um

[07:37] and so we didn't go out to build like

[07:40] the Unreal Engine coding model. or

[07:41] rather we uh we built an MCP server so

[07:44] that people could run Claude code or

[07:46] Gemini or whatever tool they prefer

[07:48] connected in and um you know every week

[07:51] or two there's going to be new new

[07:53] capabilities coming out lots of

[07:54] different companies competing and we

[07:56] want to you know be able to support them

[07:58] all um and really put the put each game

[08:02] developer in charge of how they how they

[08:03] want to integrate um you know the AI

[08:06] tools into their pipelines um to get

[08:08] maximum usefulness out of it and figure

[08:10] out Um, you know, what what really does

[08:13] it what really gets acceleration, you

[08:16] know maximized?

[08:24] >> Sure. I mean, we're building all the

[08:25] pipelines in Unreal to maximally

[08:28] preserve artistic intent. You can see, I

[08:30] mean, we gave the demos. There was like

[08:31] a video we did this morning. Like you

[08:33] can see every step of the way, our

[08:34] intention is um whatever gets built is

[08:38] is a real Unreal scene that people can

[08:41] tweak and make exactly the way they

[08:43] wanted it to be. Uh rather than just

[08:45] like, you know, typing into the prompt

[08:46] and trying a million times to to get a,

[08:48] you know, like whatever pops out, right?

[08:50] It's, you know, it's really meant to

[08:51] help people explore creatively more

[08:54] quickly and then settle in on the

[08:56] details of what they actually want and

[08:57] then do the tweaks they need by hand,

[08:59] like right in the in the engine. So uh

[09:02] for us it's it's it's human control all

[09:05] the way through the pipeline.

[09:08] >> Yeah. Yeah. Exactly that. And you know

[09:12] the gaming has always been driven by

[09:14] great games built by great development

[09:16] teams and that will continue to be the

[09:18] case. You know every every generation

[09:19] has had its way. You know it's

[09:22] stereotypical lowquality games. um you

[09:26] know from like just plain old bad games

[09:29] to asset flips and now you know we'll

[09:31] have AI slap but like you know the in

[09:33] the hands of awesome you know

[09:36] professional creators and you serious

[09:38] indies

[09:40] uh building a game uh these tools are

[09:42] just an accelerant and uh you know just

[09:45] as the industry moved from pixel art um

[09:47] to Photoshop and then from 2D to 3D

[09:50] these are just going to be ways of

[09:51] making content more efficiently and um

[09:53] avoiding the drudgery of, you know,

[09:56] handwiring a giant blueprint um and

[09:58] debugging really complicated problems in

[10:00] a program.

[10:07] I think that's for the you know model

[10:08] providers to to sort out. Um a lot of

[10:12] some of them are operating a loss such

[10:14] that there's actually a higher cost than

[10:16] they're charging um you know to try to

[10:18] grow their businesses. Um then there are

[10:20] trade-offs between local AI um and um

[10:23] you know server based hosted AI. Um you

[10:26] know I think the whole industry is going

[10:28] to have to sort that out as a whole and

[10:31] um you know our project Epic doesn't

[10:33] have billions of dollars to invest in

[10:35] building a leading edge model um to

[10:36] compete with these things. So what we

[10:38] what we can do is build you know an

[10:40] awesome MCP interface so that uh every

[10:43] one of them can talk to our engine and

[10:45] uh so on and you know I think developers

[10:47] and you know the market and um you know

[10:52] are going to ultimately sort that out.

[10:53] Um and that I think there's plenty of

[10:55] incentive for everybody to do these

[10:57] things efficiently. Um co cost is is

[11:00] going to be formidable when you're using

[11:02] a leading edge model at its maximum

[11:04] capability. Um and you know optimizing

[11:07] that is going to be a first class

[11:09] objective for everybody.

[11:16] You can't say that this is the first uh

[11:18] time the industry has gone through a

[11:19] shakeout because there have been many

[11:20] before. I was a young gamer in the 1980s

[11:23] when you know the Atari crash happened

[11:25] and then uh I was a game developer and

[11:29] um

[11:30] uh you know in the transition from 2D

[11:32] gaming to 3D um when suddenly a lot of

[11:35] the games at the time that were being

[11:37] built you know ended up not finding a

[11:39] market for them and then um you know Bit

[11:42] Torrent hit the industry pretty hard

[11:43] too. Um there was a time when uh you

[11:46] know the rumor industry rumor was that

[11:48] crisis had sold 100,000 copies and that

[11:51] 10 million people had played it. Um uh

[11:54] yeah and the solution to that was you

[11:56] know was multifaceted. um every you know

[11:59] technology generation whether it's seven

[12:02] or 10 years um you know changes

[12:05] accumulate um such so much that um the

[12:07] way people build games and play games

[12:09] changes um and the answer can't be that

[12:12] every generation we just spend you know

[12:14] exponentially more on game development

[12:17] um uh because you know the the market

[12:19] doesn't always support that um and you

[12:22] know I I think we've seen some very

[12:24] specific problems with specific games

[12:26] you know sometimes was a really big

[12:27] budget game. Shiftton wasn't very good

[12:30] um and didn't sell but much much more

[12:32] often and we've seen here with a bunch

[12:34] of the big multiplayer games um and

[12:36] about a good game um uh but the market

[12:39] dynamics prevented players from coming

[12:43] in simultaneously with enough scale um

[12:46] to make it viable you know and that

[12:48] that's why I was really talking about in

[12:50] you know Unreal fastest talks we we

[12:52] should set aside like flukes where you

[12:54] know a game didn't meet expectations of

[12:56] gamers and just look at the more of the

[12:58] structural changes and those are really

[12:59] appreciable. The fact that games are

[13:02] becoming increasingly multiplayer uh and

[13:04] not just multiplayer but social where

[13:06] you're getting together with your

[13:07] friends and then you're deciding what to

[13:09] do, what to play, h how to play it. Um

[13:12] and you know the trend of you know the

[13:14] gaming economy shifting more and more

[13:16] like some people like it and some don't

[13:18] but more and more towards um buying

[13:20] things in games rather than buying in

[13:22] buying games and in-game economy is

[13:24] driving driving gaming especially at

[13:26] scale and especially over long

[13:28] durations. You know as you see with

[13:29] these longlasting multiplayer games you

[13:31] have much more of a winner take all

[13:33] phenomena. It's really really hard for

[13:35] any new entrant to compete with an

[13:36] established game. um even if it is

[13:38] incrementally better and then you know

[13:40] after years of established games

[13:42] continually reinvesting and making you

[13:44] know their games better and better. It's

[13:45] hard for a new entrant to compete with a

[13:47] game that's had you know many years of

[13:49] development and potentially billions of

[13:51] dollars of development investment going

[13:53] into it over time um you know with a

[13:55] small team building a small game. Those

[13:57] are the huge challenges and those are

[13:58] generational and they're in a different

[14:00] sort of challenges than we've seen in

[14:02] the past. Each of them was kind of an

[14:03] isolated problem that had a solution.

[14:05] Um, and here the answer has got to be

[14:07] pretty broad change in the way that

[14:09] everybody goes about developing games.

[14:11] We've got to develop, you know, better

[14:12] games more consistently and we've got to

[14:14] develop them a lot more efficiently. You

[14:15] know, the only way that we can hope for

[14:17] new games coming onto the market um to

[14:19] be able to succeed when there's so much

[14:22] metastases

[14:26] and the really big games, you know,

[14:27] Fortnite and Roblox and PUBG Mobile and

[14:30] um, you know, a few other really huge

[14:32] ones. Um, it's got to be that those

[14:34] games get momentum by connecting to the

[14:36] economies and other games. Um, I think

[14:39] that can really reinvigorate the market

[14:40] if people are constantly um looking to

[14:43] new games as sources of new items that

[14:45] they can own everywhere um and able to

[14:48] really easily move together with their

[14:50] friends. And you know, I I think we we

[14:52] it shouldn't be understated how badly

[14:54] broken the social ecosystem is in gaming

[14:57] as a whole. Most games now are broadly

[15:00] multiplatform.

[15:02] uh you have a lot of games that are

[15:03] across mobile, you have a lot of games

[15:05] that are across PC and console, and then

[15:07] you have games that are across all

[15:08] platforms like Fortnite is um and Roblox

[15:11] is where literally the game is on every

[15:13] platform everywhere in the world for

[15:16] those to compete against that sort of uh

[15:19] sort of thing. You've got to build games

[15:20] that run everywhere and you've got to be

[15:22] able to um have social connections that

[15:25] work everywhere. You know, like if you

[15:27] look at Epic and a number of other

[15:28] independent multiplatform game

[15:30] developers, we built social ecosystems

[15:32] for that. Your Fortnite friends, your

[15:34] friends across all platforms. You can

[15:36] connect with them. Uh, you know, an iOS

[15:38] player, an Android player, an Xbox,

[15:40] PlayStation, and Switch player, and a PC

[15:42] player. We bled for that. We had a

[15:44] pretty big confrontation with Sony and

[15:46] which we ultimately got crossplatform

[15:48] play across consoles sorted out um in

[15:51] 2018 and we're grateful for that and the

[15:53] industry is better off for it. But still

[15:56] most game developers are you know locked

[15:59] into these single platform ecosystems.

[16:02] Xbox voice chat doesn't chat with

[16:04] PlayStation voice chat and Nintendo is a

[16:06] separate thing still. All these players

[16:08] in Steam can't talk to their friends on

[16:10] Xbox and PlayStation unless they're

[16:12] playing a big game that's developed at

[16:13] Bespoke uh as a custom system. And so,

[16:16] you know, one of the one of the

[16:18] solutions to this has to be making

[16:19] social work across all platforms

[16:21] natively and naturally and getting all

[16:23] the platform makers uh and all the big

[16:25] game makerers to work together to make

[16:27] that happen. Um, let's talk about an

[16:28] unreal fest. I think it's in everybody's

[16:31] interest to do so and like massively so.

[16:34] I think every platform would have a lot

[16:37] more engagement um and every game acting

[16:39] ecosystem would have a lot more

[16:40] engagement um if we connected things

[16:42] like literally I think Xbox not not just

[16:45] Epic and you name all the top game

[16:46] developers uh Epic and Roblox um you

[16:50] know and Riot um Tencent and uh EA um

[16:54] you know all the different studios

[16:56] within Microsoft we'd all be better off

[16:58] if we connected our stuff um and we'd

[17:00] all be making more money and our gamers

[17:01] would be happier so it'll be just a

[17:03] great outcome for the