A recent report by Accenture stated that according to their studies, the gaming industry is valued at $300 Billion, and it will keep getting bigger. The study even went ahead and described gaming as the next ’Super-Platform’.
This makes the gaming industry attractive to firms looking to enter it. One such case was Google’s bet on a possible disruption in the form of Google launching ‘Stadia’. Stadia is a cloud based video gaming platform in which a customer needs no hardware in particular. Only an input device like a handheld controller is needed. The game is played on their existing devices, without any hardware/graphic limitations. This is done by doing all the graphic computations at google’s end, and then streaming those back to the users device.
This does away with the need of consumers having to invest in any gaming hardware be it a gaming PC or a console. This is disruptive as it brings down the floor price of Graphic intensive gaming through a subscription based pricing model. The specific model of disruption being unbundling, as it unbundles the gaming experience and a physical console/computing unit.
Google is not the only one to have ventured into this technology. Xbox and Nvidia launched their own version of it, called ‘Xbox Cloud Gaming’ and ‘GEForce Now’ , respectively.
However, like with any new technology, cloud gaming does have its own issues that it needs to overcome before it can witness wide scale adoption. One of these are the latency issues that refer to the mismatch/delay of timing between a user’s input and the server’s output based on that input. This can cause lags in the gaming experience. This issue can only be resolved by increasing the adoption of faster optic fibre based internet connections, making the success of Cloud Gaming dependent on it.
Reference- www.accenture.com. (April,2021). The new face of gaming. [online] Available at: https://www.accenture.com/us-en/insights/software-platforms/gaming-the-next-super-platform.
Cloud Game Streaming-The Future Of Gaming?
3
October
2021
Hi Utsav! Interesting post, especially as I (and probably many others) like to play video games in my free time. For a long time I have always bought my games, mostly via Steam, but in the past few months I have tried Cloud Gaming myself with GeForce NOW. My reason for this was that many new games have high minimum hardware requirements to play (with normal FPS and video quality) and hardware like graphics cards is very expensive at the moment, mostly due to the pandemic and crypto miners. I have a relatively good PC myself, but I still can’t play some games. Wtih just Cloud Gaming and a good internet connection, I and many others can play hardware-intensive games with high FPS and video quality. Because of this, I can see Cloud Gaming becoming a huge success.
The problem I see with this technology, however, is the fact that you are basically left without a way to play the games you bought when you lose your internet. This makes your ‘gaming experience’ very dependent on your internet service provider, something I do not like personally. If this gets improved, I think this technology could be a major step forward in the gaming industry, as even people with a ‘bad’ PC will be able to enjoy the best games.
Gerrit (Gert) Giezen
Thats an insightful problem you pointed out Gerrit. I do agree with you when you say that the loss of the offline playability component can be a major obstacle.
Interesting post Utsav! While it was inevitable that hardware disks were to be replaced with online purchasing and even streaming, I don’t think we can quite say that this market segment has truly been disruptive (yet). As you mentioned, a high quality and stable internet connection is required in order to play the games, which is of course an adoption bottleneck for those living in areas with no access to such an internet connection.
Moreover, if you look at this case from a platform-perspective, it is clear why cloud gaming is not widely adopted yet. The amount of complementary goods (here, the games which can be streamed from the library) is very limited and generally do not contain popular AAA titles.
However, we are merely at the beginning of this exciting new era of cloud gaming. I’m very interested in seeing how these cloud providers will find ways to increase the adoption rate of their services, or if people would rather buy physical disks regardless.
Hey Andrew! I agree with your comment that the adoption of complimentary goods is a major factor when it comes to this technology taking off. Thank you for your comment!
Hi Utsav, captivating post on a burning hot topic in the video game industry. If we recollect the takeaways from digital goods, one of the most important ones, profit wise, was the re-producibility at virtually 0 costs of digital goods. Cloud computing would make this even truer as the games’ algorithms would just be streamed rather than copied. There has always been a divide between consoles and pc in terms of demand and cloud computing might very well bridge that gap by making pc gaming less discriminatory with regards to the comparatively high upfront costs when buying a capable machine (from 800 all the way up to the 10ks). Cloud computing may drastically broaden the demand for pc games, making it the corner stone of profit increase for every pc games developers.
As you point out, this shift in gaming platform is highly dependent on the internet sector. One could say that, as G connections spread, cloud based gaming will be become less constrained by the need for internet connection.
Hey Hadtien, thank you for your comment! And yes, as you correctly pointed out, the adoption of cloud gaming might very well lead to a wider array of games as it brings the gaming experience to even more people,