Tim Sweeney, CEO of Epic Games, criticised Valve’s PC game distribution platform, Steam, in an interview with PC Gamer during Unreal Fest Chicago 2026, over its AI disclosure requirements. While defending AI as a productivity tool, he argued that the policy unfairly stigmatises developers, discourages the adoption of legitimate development tools and hurts smaller studios that increasingly depend on AI to compete with larger publishers in an increasingly expensive games market. “I think it’s really irresponsible of Valve. They shouldn’t do it, because it makes it much, much, much harder for a game developer to have a chance of success,” he said.
Why Sweeney says AI disclosures hurt developers: Steam’s AI disclosure requirement unfairly penalises developers by attaching what he described as a “Scarlet Letter of AI” to games that use AI during development. According to him, developers seeking the widest possible audience have little choice but to release on Steam, only to have their games singled out by a disclosure that attracts hostility. “If you want to launch a game and get it as widely publicised as possible, you’ve got to put it on Steam,” he said. “If you want to play it on Steam, then you have to get this Scarlet Letter of AI attached to your product, and now there is a hater community trying to kill the game.”
He argued that the policy forces developers to choose between adopting tools that improve productivity and facing backlash from players. “You have to choose from either not using tools that can make you way more productive, and probably failing due to competition that does,” he said.
Worsening industry economics and AI as an equalizer: Sweeney tied his criticism to the industry’s worsening economics. He said development costs continue to rise while smaller studios struggle to compete against long-running games backed by billions of dollars in investment. AI, he argued, is “a great equalizer” because it allows developers to build games more efficiently. Without access to such tools, “all of those companies will die, because they just can’t compete.”
Steam’s AI disclosure policy: Valve introduced its AI disclosure policy for Steam developers in 2024, requiring studios to declare how they use generative AI in their games before publication. The framework distinguishes between pre-generated AI content, such as in-game assets created with AI tools, and live-generated AI content, in which AI generates content while a game is running. Steam evaluates pre-generated content under its existing review standards, but developers using live AI systems must also explain the safeguards they have implemented to prevent illegal or harmful outputs.
In January 2026, Valve narrowed the scope of its disclosure form, clarifying that developers only need to disclose pre-generated AI content that appears in marketing materials or ships with the game for players to consume. Consequently,…
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