Tim Sweeney, the chief executive of Epic Games, has seen computers become 100,000 times faster during the 25 years he has been making games. And he’s one of the few people in the world who knows what to do with all of that computing power and can predict where we’re heading.

His company of game designers has created titles such as Unreal Tournament and Gears of War, and it’s working on the upcoming Fortnite title. Epic also creates the Unreal Engine 4, a tool that makes it easier for other developers to create beautiful games with amazing worlds and realistic human characters. Epic’s Unreal is the engine of the game industry, and Sweeney is the one of the brains that makes it happen.

Yet Sweeney is concerned that all of the indie game developers that the Unreal Engine is enabling could face hard times if the industry doesn’t change. Getting games discovered when there are a million competitors is a huge problem, particularly as gamer attention is focused on just the top hit titles. Sweeney has given thought to this potential “indiepocalypse” and how to make life easier for developers in the game engine wars.

I caught up with him at our GamesBeat 2015 event, where we also talked about augmented reality, virtual reality, and the potential to create believable simulated humans. Here’s an edited transcript of our talk.

Tim Sweeney, CEO of Epic Games, believes that perfect augmented reality will make screens obsolete.

Above: Tim Sweeney, the CEO of Epic Games, believes that perfect augmented reality will make screens obsolete.

Image Credit: Michael O'Donnell/VentureBeat

GamesBeat: You mentioned in one of your talks that computers have become 100,000 times more powerful over the time you’ve been making games.

Tim Sweeney: That’s right. It’s an amazing transition, to go from an Apple II as my first computer to what we have now. In my pocket here I have a device that’s 100,000 times faster than my first PC. But we’re still largely on the same paradigm as we were 25 years ago. We still have a screen. It’s gotten smaller. We still have a keyboard. It’s gotten crappier. We’re still in this old-fashioned computing paradigm.

Over the next decade I can see more progress in the human use of computers than we’ve seen so far in my lifetime prior.

GamesBeat: It would be interesting to see the console gamemakers continue to drive down on realism, making existing console games much more realistic — human faces and such. But you’ve also been very excited about VR and AR. It seems like a divergence from the world you’ve been driving. Why are you so excited?

Sweeney: Unlike previous advances, where Moore’s Law has driven incremental improvements, we’re seeing a complete revolution in the human-computer interface. To go from an experience where you’re look at a little monitor to one where you’re completely immersed in a realistic experience that combines objects in the real world and synthesized images—It’s going to enable entirely new kinds of applications.

It’s not just a revolution for gaming, but for all forms of human-computer interaction. Architects, industrial designers, social network users, we’re all going to be immersed in this in our daily lives in the future.

Fable Legends is being built in Unreal Engine 4

Above: Fable Legends is being built in Unreal Engine 4

Image Credit: Microsoft

GamesBeat: In Shanghai, you said that about 10 years from now, perfect AR lenses are going to replace tablets, televisions, screens of all kinds. Do you really believe that?

Sweeney: It can be hard to extrapolate through that sort of technological change. This is not Moore’s Law. This is not incremental improvement. Let’s imagine an 8K display. They’re being manufactured now in small quantities. Imagine an 8K display per eye that follows your motion as you look around. Imagine a 120-degree field of view, filling your entire field of view, and imagine this miniaturized to the form factor of sunglasses.

We’re not talking about a big helmet that fits over your head. We’re talking about a device that could easily reach a billion consumers, or five billion, over the course of the next decade. That’s going to be a freeing experience. It has applications for all forms of software. Any sort of 2D desktop application you’re using now will be reinvented around the capabilities of AR.

Games are the easy problem right now, because we already know how we’re going to take a 3D game and translate it into AR. All the other aspects of it, though—Imagine social networks and chat, talking person to person over large distances when it looks like you’re really there. It’s going to change the world in many different ways.

GamesBeat: What about traditional game development? You brought up your own feelings about the potential for the “indiepocalypse.” Others have written about this, saying there are too many indie game developers out there. We have a few million of them. Are those folks going to be able to thrive in this world that’s coming?

Sweeney: We’ve gone through several revolutions in the game industry. The most recent has been the indie revolution, where it’s become possible for a couple of people in a couple of months to create a stand-alone game. With the move to VR and AR, it’s going to be a much harder environment. Everyone’s going to need tools to be able to build photorealistic experiences, to scale them up to the interactions you’ll expect in a physically realistic simulation. It’s going to be a competitive market. It’s going to lead to very high-quality game experiences surfacing.

This doesn’t necessarily mean huge experiences. We have this bullet train demo that we showed at Oculus Connect. With 12 developers working for 10 weeks, we made an awesome small experience. The initial VR market, since there are only going to be a few million units in the market by the end of 2016, will have mostly small experiences. But they’ll be awesome. We’ll see a move away from the simple 2D games that have dominated mobile development for a long time, toward very rich experiences with fairly stringent technological requirements.

Samsung Gear VR

Above: Samsung Gear VR

GamesBeat: The app stores, over the last few years, have been dominated by just a few games. That doesn’t bode well for all those indies out there. What would you like to see this market evolve into?

Sweeney: The market needs more structure. It’s insane that there are more than a quarter million games being released in the app stores every year. They’re each bought by two or three people. The average project is very small and has essentially a one percent chance of providing a living wage to its developers. That’s an unfortunate situation.

What we need is a much more stratified ecosystem. We need more large teams producing large, high quality experiences, and we need indie developers to be able to build on top of that. Ark: Survival Evolved, a recent Unreal Engine 4 game that was released, sold more than two million copies on Steam in the first few months. It has a thriving mod community around it with mod developers building things on top of that.

The advantage in that is that you’re building on the shoulders of giants. Instead of 250,000 games competing for top-level visibility, you have a genre of games with a leading game in it and a mod ecosystem around it. It’s a lot more opportunity for developers to be bigger fish in a smaller pond.

GamesBeat: Maybe 100 thriving sub-markets, then.

Sweeney: It’s the only plausible way that a million developers can earn a living in the game industry. There’s a path to that, but there’s not a path to 250,000 games all somehow being recognized by users.