Xbox creates Xbox Labs and connects games with AI agents

Xbox, Microsoft's gaming division, has set up Xbox Labs, a small group made up of game creators, engineers and scientists tasked with turning new ideas into things players and developers can try. CEO Asha Sharma announces it in a memo sent on Tuesday, October 13 to all Xbox staff and published on the brand's news site. Sharma says she has asked Scott, whom the text identifies only by first name, to get it up and running.

The memo ties that work to agents, the AI systems that carry out tasks on their own. According to Sharma, programming was their first big workload since they are able to write software, run it and test it, and video games have many of the same traits. She adds a figure for scale: players put in more than 72 billion hours a year on Xbox games, roughly five times what is estimated to go into writing code around the world. Before running Xbox, Sharma headed product for the AI tools and application infrastructure at Microsoft, according to her profile on the Xbox site.

As a starting point, Sharma cites what has happened in recent weeks: games quickly decompiled and rebuilt to work on machines they were not made for. Windows versions have been translated for Apple Silicon chips or moved into the browser with WebAssembly and WebGPU, the second of which is now close to 90% support across the world's browsers. She also writes that many of the world's biggest games have ended up remixed inside another game's source code. In her view, these experiments call into question old assumptions in the industry, such as the tie between software and hardware or the line between making and playing, and open the way to making good games more accessible, giving old ones a new life and letting more players become creators. She regards them as good for players even when they collide with current business models.

Xbox Labs will work in the open, learn from how people use what it makes and judge its success by whether the number of people playing and creating grows. As it learns, Xbox will share the tools it builds with developers across the industry. Sharma stresses that Xbox's priorities are not changing: the commitments to making great games, to its hardware and to looking after its intellectual property and the communities around it remain, and Labs will let it explore new technology without dropping the work already under way. The memo gives no project names, deadlines, budget or headcount for the group.