Epic Games chief Tim Sweeney has taken another shot at Valve, this time calling Steam’s requirement that developers reveal their use of generative AI “really irresponsible.” He argues the label scares off shoppers and gives an organized “hater community” a reason to pile on a game before it even launches. The dispute is less about one tag and more about how openly studios should admit that machines helped build their games.
Quick answer: Valve requires Steam developers to disclose generative AI used to create in-game content, or AI content generated live during gameplay. AI-powered coding helpers no longer need a disclosure. Sweeney wants the requirement gone entirely; Valve still enforces it.
What Steam’s AI Generated Content Disclosure requires
Valve put a formal generative AI policy in place in early 2024. Since then, studios that use AI in their games have to say so, and that statement shows up on the store page in a section labeled “AI Generated Content Disclosure.” Shoppers can read it before they buy or wishlist, the same way they check system requirements or supported languages.
The disclosure is meant to flag generative content rather than every piece of software in the pipeline. It exists in large part because of unresolved questions around training data and copyright, so the tag works as a transparency note for anyone who cares how a game’s assets were produced.
The January 2026 rewrite narrowed what counts
Valve reworked the wording in January 2026 to make the line clearer. Two things still trigger a disclosure: using AI to generate content for the game, and AI content that is generated while you play. Routine “AI-powered tools,” such as code assistants, no longer require disclosure.
| Use of AI | Disclosure required? |
|---|---|
| AI generates art, textures, music, or sound assets | Yes |
| AI generates content live during gameplay | Yes |
| AI-powered coding helpers and similar tools | No |
That distinction matters to Sweeney’s complaint. The requirement that he objects to now applies to studios using AI to produce whole assets, not to those who lean on a model for low-level coding work.
What Tim Sweeney said about the “Scarlet Letter of AI”
Speaking in an interview following his appearance at the State of Unreal event, Sweeney framed the rule as a trap for developers. To get a game seen, you have to put it on Steam so people can wishlist it, he said, and at that point the disclosure becomes a mark against the product.
If you want to launch a game, and get it as widely publicized as possible, you’ve got to put it on Steam so people can wish list it, and 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 went further, saying the policy is “really irresponsible of Valve” and that the company “shouldn’t do it” because it makes a developer’s odds of success much harder. In his framing, studios are left to either skip productive tools or risk losing to competitors who use them.
Why Epic has a stake in this fight
Sweeney’s position lines up with where Epic is steering Unreal Engine. The company has spent recent months promoting how Unreal Engine 6 builds in AI, and it has shown the tech off rather than hidden it. At a State of Unreal showcase in Chicago, Epic demonstrated large language models working directly inside the engine.
In one demo, a Claude prompt window furnished a virtual apartment by pulling requested items from the asset library. Another showed the lighting in a city scene changing simply by asking Claude to shift the time of day, or by feeding it a still photo as a reference. Epic stressed that developers keep final control and can adjust any result by hand. Steam is also Epic’s main rival in PC game sales, which colors how its criticism lands.
This isn’t Sweeney’s first complaint about AI labels
The position is a continuation of an argument he made publicly in late 2025. On X, he agreed that game stores should drop the AI tag, calling it relevant to art exhibits and content licensing marketplaces but pointless for games “where AI will be involved in nearly all future production.”
He capped that thread with a jab, suggesting that if AI use needs a label, stores could just as easily demand “mandatory disclosures for what shampoo brand the developer uses.” The reasoning is consistent: once a tool is everywhere, he argues, singling it out on a store page stops meaning much.
How players are responding to AI disclosures
The friction Sweeney describes is real. Games that openly flag AI-generated assets have drawn sharp backlash from parts of the player base, and the disclosure tag is exactly where that scrutiny lands. Common objections center on the environmental cost of running these models and the worry that generated assets crowd out human creative work.
The volume is climbing fast. Nearly 20 percent of games released on Steam in 2025 disclosed using generative AI, an 800 percent jump over the year before. That trend cuts both ways for the debate. It supports Sweeney’s claim that AI is becoming standard, while also giving Valve and many players a reason to keep the label so buyers can decide for themselves. For now, Valve has not signaled any plan to drop the requirement, and the disclosure stays exactly where it is.
