Lets use Watson (the jeopardy supercomputer) for example, do you think if you only gave it 10-15% of its current power that it would be able to compete or think at the level it is?
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The Watson supercomputer processes at a rate of 80 teraflops (trillion floating point operations per second).
The system and its data are self-contained in a space that could accommodate 10 refrigerators
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So youre telling me improved hardware doesn't correlate in someway to improved AI? The AI achievements of today could be replicated on 15, 30 year old GPU/CPU combos while keeping the same small household form factor?
And didn't Hello neighbor use some form of basic bottom level procedural AI that allowed the game to "learn" (and I put it in quotes cuz I'm sure its not real learning) your tactics and respond accordingly to them?
If power hasn't been the issue with AI for years what makes you think that improving power will help?
Devs have to choose to implement AI so complex and so heavy on computations that power would help. But they do not right now, so there's your answer.
Improved hardware does correlate to improved AI but only with generational leaps and I'm not talking a single console generation here.
Machine Learning for example was a thing in the 60ies, but machines weren't strong enough to train neural networks like we can today on a normal desktop PC.
If you wanted to train a neural network in more or less real time in a game, then GPGPU would help with that, but like I explained before that is not a useful scenario. It might be in the future when new techniques to model AI have been invented that help adress the issues that come with machine learning during play.
As for your Hello neighbor example, I don't know much about the game, but 'adaptive AI' per se is not new. The term 'Intelligence' in regards to AI and different algorithms is wery unclear among academics. A state machine, a common pattern used in AI, is not much more than a glorified series of if-else statements, yet it can produce 'AI' in games that appears to be smart, learning even. Changing parameters of AI depending on the game state is easy enough to do already, but we are talking about horsepower - and the kind of learning that horsepower could provide is not used in games due to unpredictability.
Game AI will not evolve unless devs chose to. That's the thing you should take away from this.