Microsoft is actively expanding Copilot to more digital and physical because the future is now all about generative AI. One thing we still haven't seen Microsoft do is AI in video games and this will change soon.
Ubisoft has already tested AI to generate NPC character dialogue. They have also successfully done a demo where the player interacts with this AI NPC. With Microsoft starting to advertise a job opening for the position of Senior Director of Applied Science of Game AI, we may see a new contender for AI in video games.
The position Microsoft offers is to manage the data and applied science teams for learning the basic models that games require. This position will work with game studio teams and other various platforms, and develop AI and machine learning systems to spawn new generation platforms and other gaming experiences.
We will probably see Xbox AI NPCs or Copilots that can be assistants to players. When it will be introduced is not yet certain. It will definitely take a few years or who knows the next generation of Xbox consoles will be Xbox AI?