Pixel P&L: Larian Studios Defends AI Use in Game Development Amid Industry Pushback

Welcome to another Pixel P&L edition. This issue takes 6 minutes to read. If you only have one, here are the 5 most important things:

• Larian Studios faces backlash after revealing AI use in prototyping, despite maintaining a 72-person art team.

• Tencent invests in Drama Studios, the French developer behind viral bodycam shooter Unrecord that generated 40 million views in 20 hours.

• Bethesda confirms The Elder Scrolls VI development is advancing, with majority studio resources now focused on the long-awaited title.

• Shift Up CEO receives Presidential Commendation as Stellar Blade surpasses 3 million sales.

• TikTok's $14 billion US sale stalls despite securing financing and Supreme Court upholding divestment mandate.

Let's get into it.

Larian Studios Defends AI Use Amid Fan Backlash

Larian Studios faced industry criticism after CEO Swen Vincke disclosed the company uses generative AI for early-stage prototyping in its upcoming Divinity title. The Baldur's Gate 3 studio employs AI for ideation and placeholder content, which designers replace with handcrafted assets before release.

Vincke rejected characterizations that Larian is "pushing hard" on AI adoption, emphasizing the studio's 72-person art team (including 23 concept artists) continues expanding. Publishing director Michael Douse distinguished Larian's workflow tools from competitors shipping AI-generated content directly in games.

The disclosure prompted backlash from former junior environment artist Selena Tobin, who urged reconsideration. However, Vincke maintained AI serves reference purposes similar to Google searches, not content creation. The controversy surfaces as gaming industry AI adoption accelerates, with several 2024 releases inadvertently shipping AI-generated placeholders.

Larian has hired additional staff rather than pursuing AI-driven workforce reductions common across the gaming sector.

Tencent Invests in French Bodycam Shooter Developer Drama Studios

Chinese gaming conglomerate Tencent has acquired a stake in Drama Studios, the French independent developer behind viral first-person shooter Unrecord, to fund expanded development and staffing.

The investment follows Drama's 2023 breakthrough when a two-minute Unrecord trailer generated 40 million views within 20 hours, showcasing photorealistic bodycam-style gameplay depicting police shootouts. The footage sparked industry debate over visual authenticity and content sensitivity.

Drama CEO Theo Hiribarne said Tencent provided support while respecting the studio's creative direction, enabling transition to full production. The company plans project updates for 2025.

Tencent VP Mark Maslowicz cited Drama's progress despite limited resources as justification for the partnership, positioning Unrecord as the first of multiple anticipated titles.

The deal extends Tencent's Western indie studio investment strategy, which includes stakes in developers across Europe and North America. Drama joins a portfolio targeting premium single-player experiences alongside Tencent's mobile and live-service properties.

⚡️Quick Bytes

Bethesda Reports Progress on Elder Scrolls VI

Bethesda Game Studios confirmed that The Elder Scrolls VI development is advancing, with studio director Angela Browder citing hardware improvements since Skyrim's 2011 release as enabling expanded creative possibilities. Executive producer Todd Howard said majority studio resources now focus on the title, first announced in 2018. Design director Emil Pagliarulo defended extended timelines, comparing development to Rockstar's recent Grand Theft Auto VI delay, emphasizing quality over release pressure.

South Korean President Honors Stellar Blade Developer

Shift Up CEO Hyung-tae Kim received a Presidential Commendation recognizing contributions to South Korea's gaming industry through Stellar Blade and mobile title Goddess of Victory: Nikke. The 2024 action game sold three million copies across PlayStation 5 and PC by mid-2025. Former PlayStation executive Shuhei Yoshida credited Stellar Blade with boosting Korean developer confidence internationally. Shift Up is developing a Stellar Blade sequel addressing narrative weaknesses, plus Project Spirit published by Tencent.

TikTok's US Sale Stalls Despite Investor Readiness

Billionaire Frank McCourt's Project Liberty consortium has secured financing to acquire TikTok's US operations but remains sidelined as the Trump administration delays mandated divestment proceedings. Congress ordered ByteDance to sell TikTok's American business over national security concerns, a requirement upheld by the Supreme Court. Trump claimed international investors reached agreement with Chinese approval, though no transaction has materialized. McCourt's bid values the platform around $14 billion under enhanced data security protocols.

⚔️Side Quest

🤣Laugh:

📺 Watch: Lumikai's Salone Sehgal breaks down the reset seed funding landscape in gaming and interactive media, detailing five non-negotiable pitch requirements: team competence, vision clarity, competitive understanding, commitment, and early proof points. Essential viewing on distinguishing vanity metrics from retention and engagement signals, mastering guerrilla distribution tactics, and navigating the shift from speed-focused to hypothesis-driven venture capital expectations.

🎮 Play: Great God Grove delivers charming puzzle gameplay through quirky dialogue-slinging mechanics, vibrant mixed-media visuals, and delightful queer-coded characters. This compact adventure from LimboLane offers clever puzzles that scale perfectly with its runtime, laugh-out-loud humor, and thoroughly odd vibes that create a cozy comfort game experience.

📚 Read: Supergiant creative director Greg Kasavin reveals how Hades 2's 18-month Early Access shaped its expanded mythology, massive 400,000-word script, and divisive ending rewrite. This GamesRadar interview explores how player feedback drove mechanical iterations, boon rebalancing, and the collaborative chaos that produced Scylla's glam rock boss fight in a roguelike designed to evolve perpetually through community input.

💡Did You Know

In 2015, a sharp-eyed shopper spotted a copy of Stadium Events (one of the rarest NES games ever released) at a North Carolina Goodwill store. Despite having just $30 in her bank account, she bought it for $8. When she brought it to a local game store, the owner offered her every dollar in his register. She declined and listed it on eBay instead, where it sold for $25,000. Stadium Events is exceptionally rare because Nintendo recalled most copies after acquiring the rights, making surviving cartridges highly sought after by collectors. Her gamble turned an $8 thrift store find into a life-changing windfall.

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