Google's Genie 3 turns a text prompt into a playable open world you can explore. It's rough now. Future of games, or a tech demo?

Google's Project Genie went global this week and I have not stopped thinking about it. You type a sentence, or upload an image, and it generates an open world you can actually walk around in, in real time. No code, no game engine. Someone made a GTA-style open world of Istanbul and just strolled through it, with pedestrians and traffic reacting around them. The reality check: it is rough. Low framerate, laggy response, visible bugs. Right now it is a tech demo, not a game you would sit down and play. But the trajectory is the whole conversation. I keep going back and forth. One side: this is the beginning of the end for the traditional pipeline. If a sentence can spin up an explorable world, the engine, the assets, the studio, all of that stops being the gate. Anyone gets to make a world. The other side: interactive world models hit a wall fast. Consistency, object permanence, holding a world together for more than a few minutes, framerate. It could stay an impressive demo that never becomes a real game for years. My honest guess is the "walk around a generated world" part is genuinely new, but the gap from explorable demo to a game you would actually play is huge and might not close as fast as the hype says. Where do you land, real threat to game engines in a year or two, or a plateau? And what is the first world you would generate?