I'll agree that it is not cheating but rather a handicap as long as the player knows beforehand that the AI gets massive bonuses the player does not.
To be fair, both players need to know the rules before the game starts.
How many of the players complaining on Steam knew that going in? None. How many of them were cheated? All of them.
Their expectation is that easy difficulty levels give the player a bonus, Normal is a fair fight, and hard difficulty levels give the AI a bonus.
This is a problem because it gives many players a bad experience right out of the gate. They need to know about the handicap when choosing a difficulty level. It should be in the description.
This is made worse by a second problem. The normal difficulty level is too hard. Their expectation is that the easy difficulty levels are for weak players, the normal difficulty level is for average players, and the hard difficulty levels are for elite players. No one wants to think of themselves as below average so they start on the normal difficulty level. Another reason to play on the normal difficulty level is because the player wants to experience the games content with an appropriate challenge; not spoil it with a cakewalk. This could be fixed by moving Normal up a slot or providing better guidance up-front so they can beat the game on Normal or by making the game less confusing so they don't need guidance because they can make intuitive choices (which is what the Super Nova mod does).
I was thinking of something like this for the Super Nova mod:
New Player - New players are encouraged to start here in a small galaxy with two opponents. AI Bonus 0%
Beginner - Beginners are encouraged to continue here in a medium galaxy with four opponents. AI Bonus 20%
Experienced - Experienced players are encouraged to play here in a large galaxy with six opponents. AI Bonus 30%
Veteran - Veterans are encouraged to play here in a huge galaxy with seven opponents. AI Bonus 40%
...
This provides better guidance, full disclosure of the handicap, and takes ego out of the choice.
In conclusion, it is not the players who are at fault, but the game that needs to be changed.
Depends on how you look at it. A.I. cheating? what else is new. This has been used by programmers since day 1 to compensate for various short commings. If you are getting stomped by the A.I., just play on an easier setting until you get a hand of it. If you are losing on the easiest setting, then look at some youtube LP series to see how others win.
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