The dream of gaming without dedicated hardware has never been more appealing with flashy new game consoles like the PS5 and Xbox Series X. Big tech companies showed that they agree at the largest annual showcase for tech.
There is only one problem with game streaming.
Microsoft, Amazon, Sony, and others have all tried, but they have yet to perfect cloud gaming. Streaming apps like Stadia have impressive tech, but they have not fully stuck the landing and are not mainstays in the gaming space. The majority of cloud gaming apps have left us scratching our heads because of technical troubles, lackluster libraries, and busted business models.
Big tech is not being stopped, though. Tech companies still believe in the promise of cloud gaming, even if it is not supported on smart TVs or on 5G service.
Will the concept be viable by the time the next Consumer Electronics Show comes around or will we be left scratching our heads?
The major players.
Right now, the best value in game streaming is the Xbox Game Pass. Credit: Beata Zawrzel/NurPhoto via
There are a few major cloud gaming services that you can use to play on phones, web browsers, and smart TVs. A roll call of the most relevant parties in cloud gaming looks like it.
Different game libraries, business models and audiences are what these services have in common. For example, if you want to stream PC games you already own to other devices for an hour at a time for free, you can do it with the help of GeForce Now, or if you want to pay a monthly fee, you can do it with Amazon Luna. Stadia gives away some games with a monthly membership, but users have to pay for individual games in order to get access to the whole library.
Microsoft's Xbox Game Pass Ultimate is the most unique offering in that group. The cloud feature is a bonus add-on for a monthly service that otherwise lets users download every game on the service and play them locally if they have an Xbox or PC. Game Pass isn't the main selling point, but streaming is a nice perk.
It is difficult to tell how successful any of these ventures have been due to a lack of self- reported numbers. Game Pass had surpassed 20 million subscribers at the same time as PS Now, which makes it sound good until you realize it had over 3 million subscribers last year. It is difficult to know how many Game Pass users play games in the cloud, if at all, because of scarce data. The cloud portion of PS Now is going to be merged into a new subscription service later this year.
And then there is Stadia. More than two years after launch, Stadia has yet to release any original titles, most likely because the studios tasked with making those games were closed. According to a report last year, Google missed internal projections for monthly users by hundreds of thousands.
Why does big tech still believe in game streaming?
Michael Futter, founder of the consulting firm F-Squared, said that the tech behind cloud gaming is useful to consumers even when not attached to a sustainable business model.
Futter said that it was easy to sell people on the idea that they didn't have to purchase hardware to play a game. There have been moderate successes in different places, but they have not been long-term.
Shadow, a PC cloud gaming service that had a burst of popularity in the late 2010s, went bankrupt last year before being sold off by its parent company. Shadow was well-liked by those who used it. There is no game-streaming-only service yet.
That could change with smarter business models.
They will come if you build it and bundle it.
Amazon Luna could do well.
Cloud gaming will have an easier time finding an audience if it doesn't have to find one at all. Cloud gaming can be attached to a service that already has a built-in user base and offer it as a bonus.
It is more likely that companies will give it a try if they can pair their cloud gaming services with something customers already like. Amazon Prime has 200 million subscribers and could be a perfect candidate for this. Amazon doesn't give away Luna with a Prime subscription, but there is a kid-focused tier for just $2.99 per month, and the base subscription is only $5.99 per month. Luna runs well on the latest Fire TV Stick streaming devices. Stadia charges up to $60 for individual games, but pricing out potential customers no matter how much they like the company.
The former co- founder of a gaming market research firm who now teaches at the NYU Stern School of Business said that Luna could potentially find an audience among those who are already in the Amazon ecosystem, even if it costs a little extra.
Van Dreunen said that a PC enthusiast wouldn't look at Amazon Luna and get excited. Someone who is already on Amazon Prime says, 'You know what?' I want my child to have a few things to play. It is a very different proposition.
Even if their cloud gaming services don't take off right away, massive companies like Amazon and Microsoft can still survive. Game Pass is the most likely current cloud service to thrive because it is popular among gaming enthusiasts. The fact that every first-party Microsoft game from here on out is free to play on Game Pass is helping this leader status. Microsoft already has an extensive cloud computing network of its own to work with. Why build a huge network and not get as much out of it?
You pay for Game Pass, you pay for Xbox Live as part of Game Pass. Futter said that you get cloud streaming at no additional cost. I might use that because it is part of something I already have.
Working out the issues.
There are a number of problems that need to be addressed before cloud gaming is widely adopted. Hot garbage is what broadband infrastructure in the U.S. is. Cloud games are not responsive to play because people can't get consistently high download speeds. It will take time for the Biden administration to alleviate this.
There are other game design problems when playing games for 4K TVs on smaller screens. Text can be too small to read, enemies can be hard to see, and so on. Phone users need to be accommodated if the appeal of cloud gaming is the ability to play anywhere on any device.
The founder of Hit Detection said that fixing this issue is more important than fixing bandwidth issues.
Croal wants to see Microsoft, Sony, and Google put money and resources into figuring out whether there are tools or filters that can help solve some of the experience.
There is no room for newcomers in the foreseeable future.
The example of 'Halo Infinite' is a good example of why game streaming is helpful. The credit is for the Xbox.
Tech companies are still interested in supporting cloud gaming via smart TV apps and subscription bundles, but where the business actually goes over the next 12 months is anyone's guess. The console hardware shortage has made it very difficult to find an Xbox Series X or PS5 in the cloud, which could help Game Pass grow its audience. It might not be a problem by the end of the year, but with the continued spread of COVID-19 and its effect on production, good luck predicting anything about supply chains.
I have a friend who played through the campaign on Game Pass because he didn't have an XBOX or PC, and it's a big deal in our social circle right now. If Microsoft or Sony wanted to give users a chance to play the hottest and newest games without setting up stock alert, it could pay off. This could be a main selling point for cloud gaming.
Croal thinks that the solution exists for a game like Halo. There are a lot of devices that can run Game Pass in the Cloud.
The elephant in the room is the rumored Game Pass competitor, Project Spartacus. If Microsoft and Sony both offer cloud-based gaming libraries with heavy-hitting exclusive games, that could make it harder for other services to stand out. Amazon has a lot of things going for it, such as its own cloud network with Amazon Web Services, but it doesn't have God of War: Ragnarok.
It felt like the streaming service was dead before it could ever live, but Futter didn't give up.
I don't think anything will save Stadia. Futter thinks that the consumer-facing side of Stadia will disappear in 2022. The business model of the tech is not good.
If Stadia, GeForce Now, and the like are unable to compete against Microsoft and Sony, the smart TV apps that were just announced at the show would be useless. The winners of the cloud gaming war will always have time for those TV makers to cut app deals.
The streaming tech is already good and it will only get better from here on out, which is why big tech still believes in cloud gaming. Consumers have a need for an easily accessible alternative to expensive console hardware. It will take the right combination of games, value, and infrastructure improvements to make that belief pay off.
Microsoft and Sony are in a race to lose.
