Speaking at a Los Angeles event showcasing upcoming releases, Yves Guillemot said generative AI, or Gen AI, could make open-world games like Ubisoft's blockbuster "Assassin's Creed" franchise feel even "more alive."

Among the games previewed at the event were hotly anticipated "Star Wars Outlaws," based in the universe of the iconic film series, and "Assassin's Creed Shadows," which transports the historical fiction franchise to feudal Japan.

"What we see with Gen AI is the possibility for those worlds -- those action adventure open worlds -- to be a lot more interactive and more alive," he said.

"When I say alive... if you meet a non-playing character, you can speak with that person and you can have a relationship with that person."

He described generative AI, in which trained computer programs create everything from text to videos in seconds on simple prompts, as "something that will transform our games."

But with a heavy demand on computer processing and resources to train the models, "the only problem is how much it will cost," Guillemot said.

Ever since the explosion of the generative frenzy with the release of ChatGPT in late 2022, eyes have been on the ways the technology could change the video game industry.

After a massive boom during the coronavirus pandemic, the video gaming industry has been on the back foot, with a wave of layoffs and cost-cuts at the biggest companies.

The sector has also been struggling with the dominance of franchise titles, such as "Call of Duty" or "Fortnite", which has made it harder for new titles to emerge.

"Star Wars Outlaws" will be released on August 30, while "Assassin's Creed Shadows" is slated for a November 12 debut.

- Shift to the cloud -

"What we miss in the industry at the moment is big innovations. We need genAI, we need cloud, to help us to bring really new experiences," Guillemot said.

Cloud gaming, which has rapidly gained traction in the industry, allows users to stream and play high-quality games without the need for expensive hardware or dedicated gaming consoles.

Proponents of cloud gaming say the shift could foster a more vibrant and connected gaming community as it breaks users away from relying on one console ecosystem, such as the Xbox or Sony's PlayStation.

Guillemot welcomed moves by Apple and other device makers to juice up their hardware with more powerful chips, which could take gaming's increasing computing needs out of the cloud and onto the device itself.

Adding AI chips to hardware such as the iPhone or laptop "will mean more intelligence in our games" and could also ease up on the needs and cost of cloud computing.

"AI is coming," Guillemot said. "We know it can be mass market. The problem is the adoption takes time and we still have the cost issue."