They haven't. Probably one reason Adobe's AI will beat them out long term.
Also another thing that's been on my mind is I wonder if all this AI generation stuff could cause a Games Industry style crash where due to such a over saturation of highly advertised but meaningless/worthless AI content consumers lose interest and stop spending money in different respective industries (books, ganes, films, digital art, music, etc.) and then they crash.
If there's an AI crash it will be due to the vast number of AI companies with insufficiently differentiated products and subsequent race to the bottom, not due to the ubiquity of the output.
I am not aware of a games industry crash, it would appear that gaming is an industry larger than all other forms of art combined. But indeed niches that are saturated by enshitified content have almost crashed and I get your point. I suppose the average will turn even more average and indeed people will stop spending money on it. AI being a statistical machine it will excell at making whatever is common and plenty and as such those industries will suffer even more. Average music, content writing, drawings, etc, will drop to near zero value, that's guranteed.
The comment you're replying to is referring to the video game industry crash in North America in the early 1980s. Basically the market was flooded with games of poor quality due to a lot of factors, including Atari's complete lack of quality control on games they put on their 2600 console. Nintendo ended up redesigning their Famicom console as the Nintendo Entertainment System with an emphasis on it looking like a VCR as opposed to a cheap game console like NA audiences were used to (the Famicom itself is fairly small and plasticky with permanently attached controllers). Additionally they were strict about licensing development on the system with the goal of fostering a crop of family friendly, high quality games. It was a couple years after the fact (iirc) but Nintendo's efforts to differentiate themselves in the wake of the crash obviously payed off and led to a long period of Japanese ascendancy in the games markets. So the crash cleared out a lot of the market and led to a huge opportunity for Nintendo.
No, this has been directly confirmed by Nintendo developers at various points. For people to even be able to try SMB, they'd have to be convinced that the NES wouldn't suffer the fate of the Atari 2600 and the like. It wasn't just about the VCR-looking design - the marketing materials had very careful wording to avoid associations with the failed game consoles, and accessories like R.O.B. (that never even existed in Japan!) were mostly made to make the NES look like a complex electronic toy, and not a game console.
Also another thing that's been on my mind is I wonder if all this AI generation stuff could cause a Games Industry style crash where due to such a over saturation of highly advertised but meaningless/worthless AI content consumers lose interest and stop spending money in different respective industries (books, ganes, films, digital art, music, etc.) and then they crash.