AI Emerges as a Potential Divide Between Gaming Operators and Regulators
Artificial intelligence is rapidly gaining traction across the global gaming industry. However, a new report suggests it may also become a growing point of tension between operators and regulators. The “State of AI in Gaming 2026,” published by the University of Nevada, Las Vegas (UNLV) International Gaming Institute in collaboration with KPMG, highlights a widening gap in how AI is understood, deployed, and governed across the sector.
The study, based on surveys of 83 companies and 113 regulators across multiple jurisdictions, suggests that while AI adoption is increasing, alignment between industry practice and regulatory oversight remains limited.
Gaming Industry Lags in AI Maturity Despite Widespread Adoption
According to the report, the gaming sector scores 45 out of 100 on an “AI Maturity Index.” This score places it behind broader industry benchmarks. The index evaluates strategy, infrastructure, expertise, and governance. Notably, governance scores the lowest at just 30.
While companies show relatively stronger performance in strategy, the report highlights that most organisations remain in early stages of AI development. This is particularly true in regulated and legacy-heavy segments of the industry.
Security and Product Development Dominate AI Use Cases
Among gaming companies, Artificial intelligence is primarily used in technology, cybersecurity, and product innovation, accounting for roughly half of all reported use cases. By contrast, risk and compliance functions remain among the least cited applications.
Researchers noted that this contrasts with more customer-facing industries, where AI is often used heavily for engagement and personalisation. In gaming, however, operators appear to prioritise system integrity, fraud prevention, and product development over direct user interaction. This is largely due to regulatory constraints and higher risk exposure.
Governance Gap Raises Industry Concerns
One of the most significant findings is the 27-point gap between Artificial intelligence strategy and governance maturity. While organisations are actively defining AI strategies, governance structures are lagging behind.
Only 22.9% of companies reported having dedicated roles focused on AI ethics, compliance, or responsible AI oversight. Researchers warned that this imbalance suggests the industry is advancing faster in deployment than in building safeguards.
Top concerns among companies include cybersecurity risks and data privacy vulnerabilities. Meanwhile, risks such as problem gambling and unfair player outcomes ranked lower in perceived importance.
Regulators Show Limited AI Preparedness
On the regulatory side, the report highlights notable inconsistencies in AI literacy and preparedness. While regulators expressed confidence in identifying ethical risks, many reported lower confidence in assessing how artificial intelligence is actually used by licensed operators.
The average AI literacy score among regulators was 8.6 out of 14. There was no strong correlation between AI training and practical understanding. Only 52% of regulatory bodies reported working on formal AI guidelines or review frameworks.
Researchers also found that regulators may be aware of governance challenges. However, they remain underprepared to address them due to limited internal expertise and the rapid pace of artificial intelligence development.
Misalignment Between Industry and Regulatory Perception
A key divergence highlighted in the report is the mismatch between how regulators perceive AI usage and how operators are actually deploying it. Although regulators believe AI is primarily used for customer-facing functions, companies report focusing more on security, infrastructure, and product development.
This disconnect raises concerns about the foundation for future regulatory frameworks. There are also questions about whether they accurately reflect real-world AI applications in the industry.
Limited ROI Despite Growing Investment
Despite increasing interest in AI, the report finds that measurable returns remain limited. The average score for AI-driven cost savings was just 2.43 out of 5. Nearly 60% of respondents reported minimal or no savings so far.
While expectations remain optimistic—particularly for returns within the next one to two years—many organisations acknowledge that it is still too early to fully assess ROI. Notably, 42% of companies reported no current AI-related hiring plans. This suggests a cautious approach to scaling artificial intelligence initiatives.
Collaboration Seen as Key to Future AI Oversight
Despite current gaps, both regulators and operators agree that cross-border collaboration will be essential to improving AI governance in gaming. However, differences in perception, capability, and implementation suggest that alignment may take time.
As AI continues to evolve, the report concludes that the industry is not just facing a technology shift. It is also facing a structural governance challenge that could define the next phase of regulatory development in global gaming markets.
