Talk of console wars has
dominated video games for years. There are gamers who swear by the benefits
of gaming in front of a keyboard and mouse on a custom built P.C., while others prefer the convenience and
ubiquity of consoles like the Xbox and PlayStation. Those console brands in
particular have built a name for themselves as powerhouses in the
world of convenient at-home gaming. Microsoft sold 30 million units of the
Xbox One console between its release and November 2013 and the end of 2017. Sony sold 73 million units of the
PlayStation 4 console and that same time period. Video games are a
big business in 2018. Video games and EA
Sports generated about $24.4 billion in revenue about $2
dollars higher than 2017. The industry is expected to hit $31 billion
by 2023, but at the same time, console sales are falling. Console sales were forecast to decline by
12 percent in 2019 compared to the year before. But there’s a new player
in the game: streaming video game platforms. The reason that streaming is
appealing to consumers in a vacuum is that it obviates the
need to purchase a console. You could play from anywhere, on any device,
at any time and you don’t need to worry about your
hardware becoming obsolete. Google’s Stadia, Microsoft’s Project xCloud
and Nvidia’s GeForceNow make it easy to play top tier games without
the top tier console or p.c. The subscription -based services stream video
games from high -end gaming machines through the cloud, and that means
the future of video games may no longer need the console. Video games are a phenomenon that have
largely taken shape over the last 50 years. Arcades and at -home consoles launched
in the early 1970s and quickly flourished into a booming industry. Magnavox presents Odyssey The Electronic
Game of the Future. The Atari video computer system is
20 cartridges with 1300 game variations you play on your own TV set. But those really were the only options
for gaming in the beginning, at least until the personal
computer became popular. The p.c brought with it a new
way to play with friends too. As the advent of the internet meant
more and more people were hopping online, but consoles
weren’t there yet. It’s largely the famed release of the
PlayStation 2 in 2000 and the original Xbox in 2001 that brought console gaming
into the form we know today. Those consoles were praised at the time
for their breadth of content and specs and largely saw rave reviews. But the feature that was arguably the
most ambitious for these consoles was their internet connectivity. The original iteration of the PlayStation
2 didn’t come with Internet connectivity built in. It was sold as a separate accessory. But the original Xbox did, and
both Sony and Microsoft launched online services for these consoles about a
year after their release, Sony’s online connectivity was limited and largely relied
on individual game makers to facilitate the servers for those games,
much like how PC gaming works. But X-Box launched a whole new subscription
model as a way to manage online gaming. Xbox Live. Xbox’s subscription service facilitated online
gaming of legendary titles like Halo 2 and created a cultural
phenomenon of playing with anyone, at any time, around the world. There were a couple of
caveats to online play, though. The first was that you had to
have a fast enough Internet connection, and the second was the requirement that the
person you were playing with had the same console as you, regardless of
whether the game was available on multiple platforms. This lack of cross-platform play ability has
been a problem in the gaming industry for years. Even as the new generation of consoles
were released, the Xbox 360 and PlayStation 3 came with exclusive games that
would only be played on their platform and on their servers. It suddenly became important which console
you had in which your friends were playing on. The PlayStation 3 came
with the new PlayStation Network, a free platform that allowed users to
get online with an optional premium PlayStation Plus that gave users
special perks and discounts. And massively successful video games like
Grand Theft Auto Online had tens of millions of players around the world
who only saw fellow players on the same console. But fast forward to 2020
and the sentiment of the walled garden of online gaming
is starting to change. Games like Fortnight, Rocket League and
Call of Duty Modern Warfare have done away with this and allowed anyone
with any console to play each other. And these games have
been massively successful. As of March 2019, Fortnite has 250
million people logging in to play with others. Suddenly consoles are becoming
less and less important. Performance on both the Xbox and the
PlayStation is solid and more games are starting to allow you to game with
others regardless of what you’re playing on. So is there a
need for consoles anymore? They know consoles are going away. They know that streaming in 20 years
is going to be so ubiquitous that you’re just not going
to need a console. Gamers have been wanting to take their
video games with them for years and console makers are starting to provide
services like PlayStation Now and Xbox Play Anywhere, stream your consoles games
to a screen of your choice. But these have been imperfect solutions that
still rely on you to shell out the cash for a console to begin
with, OnLive and GeForce Now changed that. And they were the first real streaming
services for games that used offsite company, owned hardware to
deliver games to users. And now Google Stadia has entered the
mix and promised 4K gaming over the internet entirely on Google’s servers. All you need is an account,
a screen and a controller. Stadia even has a selection of games. It includes in its
paid subscription for $9.99 a month. If you go with the free
version, you’ll have to buy the games yourself. Microsoft has also started planning
its foray into the streaming game wars Project xCloud is meant
to take on Google’s directly, streaming games from Microsoft’s own
cloud computing infrastructure. And really, it makes sense that these
are the two big players in the streaming gaming industry right now. Google and Microsoft are responsible
for a combined 19.5 percent of cloud infrastructure
services in twenty eighteen. Microsoft Azure is 15.5 percent of that. Combine that with
Microsoft’s mastery of gaming with its Xbox platform, and the company stands a
real chance to take hold of the streaming video game industry. Delivering a seamless streaming experience really
is a function of data centers more than anything. I mean, the technology knowing that Gaikai
and OnLive, had the technology 10 years ago and it was
not perfect, but it worked. And here we are 10 years later. You know, E.A.’s doing
it on mobile phones. I mean, I’ve seen it and E.A. is, you know, a small T
tech company, unlike Amazon, Apple, Google, Microsoft, Sony are bigger
T tech companies. In short, these companies could drive people
to streaming instead of to the store to buy a console. So what does all of this new
tech mean for the future of consoles? Can Stadia really replace them? So Stadia has been a great idea. It’s been a lot of fun to play
at home, but I’ve noticed in the community, especially on Reddit, people are upset about
a bunch of things, whether it’s a lack of updates or a lack of games. Stadia is not necessarily a concern
for Microsoft or Sony, who’ve now announced Xbox Series X
and PlayStation 5. Xbox Series X seems like it’s going to be
more of a service in addition to a console, so might see xCloud
built out into that. Or maybe console owners get access to
streaming video games or just people can go out and buy
a streaming subscription from Microsoft. Microsoft is banking on the future
of streaming games with its project xCloud. But in this first iteration,
there are just too many opportunities for streaming to go wrong, particularly
when gaming on the go. At times, playing on 4G LTE meant
frozen screens, choppy audio and controls having a mind of their own and Stadia
itself isn’t ready to fully take on video game consoles. You need one of
Google’s latest smartphones to play on the go or a computer running Chrome
if you want to play at home. Some of these problems are growing pains
for any new service, but others are out of any one company’s hand. So what needs to change? 5G could be the linchpin in
making a service like this work. The increased speed and throughput could mean
even users in a crowded city could see lag -free gaming. In urban areas like cities, you
have wireless carriers launching what’s called millimeter wave 5G and that’s about
10 times faster than 4G LTE. There’s also this sub-six gigahertz 5G, which
isn’t much faster than 4G LTE. So what you really need is more areas
with the millimeter wave 5G so that people with Stadia can play games with
fast enough speeds to connect online and stream all these graphics. But 5G is only available in select
locations by most providers in the U.S., with them promising to expand in 2020. And that technology, too, is
in its early stages. Some early testing of 5G has found
that speeds are largely dependent on how close you are to the tower or if you
have a clear line of sight and more. The solution for 5G is put a
tower on every single streetlight, which means the real estate’s there, power supply is
there and it doesn’t go through the glass so we’re all going to have to
have some kind of router that has an external receiver and suddenly everybody’s
going to have internet everywhere and super high speed. That’s the best thing that could happen
to any content owners who wants to distribute their content. Then there’s the
service itself, which only has a handful of games to play. Google has announced that it will add 120
titles to its service in 2020, but until these games are available, there
could be little incentive for people to take the service seriously. And that really is what could make
or break a streaming service like this. The more people that join, the more
people there are for companies to cater to and more players to interact with. This is where a service like
Google Stadia could live or die. Google is known for how readily it
will kill a service if it’s unpopular. So one of my biggest fears with
Stadia still remains, and that’s that Google has canceled dozens of products in the
past that they don’t take off decides that just no longer
interested in the market. And I think Google could still potentially
do that with Stadia one day. People don’t buy it, they could just
say, ‘OK, we’re ending the service, it was a fun run’ and maybe licensed
the technology to other companies instead of fully supporting it itself. Plus, other companies have different solutions
for how to game anywhere. Take Nintendo’s Switch console. Which gives you the ability to take the
same console you play at home with you on the go. Or the growth of
the video game industry on mobile devices. A study from Activision-Blizzard and
Newzoo, you found that 2.4 billion people would play a
mobile game in 2019. That study found that one in two apps
open in the seven day period were games. This might not be enough to
end consoles altogether in the near future, but there are more and more
ways to get your gaming fix without buying one. There’s a portion of the
population who will just never buy a console, but it doesn’t
mean consoles go away. If Microsoft and Sony make that a
really good experience, they’re going to have a really faithful group of
consumers who will support their consoles. I just think each
console generation gets smaller. And what I can’t predict is what these
consoles will do for me other than play games.