Regardless, I can't see it generating instant frames in response to player input like that. It's just not effective. We have way better ways to do it already.
If SORA can be used to design 3D worlds that later get used in traditional game engines, that might accelerate development.
The larger possibility is that video has shown the AI has some capacity to preserve structure overtime. The objects in the video maintain their dimensions and appearance as we would expect. This suggests there's some representation of objects or an equivalent to it. If that could be controlled more then potentially you have the ability to hold something like a game in working memory and iterate on parts of it.
You know those clickbaity mobile game ads you see everywhere on FB, Youtube, etc? Things are about to get 100x worse with video AI like Sora.
You can spend days generating one frame of the video offline
Whereas realtime you need to generate a frame in the magnitude of 30-40ms
It's not as if the high end of modern generations aren't already capable of photorealism - or has everyone already forgotten the GTA 6 trailer?
The only reason to choose AI is to be able to fire artists, which is what the calculus will actually be. Not whether AI is a superior solution (it isn't) but simply adequate enough that studios can made up for the drop in quality by cutting employment and still make a profit.