Your favorite cloud gaming platform may not survive
Not all cloud gaming platforms will succeed. It’s a blunt statement, one that may draw the ire of some players in the cloud gaming community. It’s also an idea I’ve wrestled with personally, as I see my favorite platform deviate from the promises it had once made. Both as a method of catharsis and a need to drop a bit of truth,, here’s a quick look at why some cloud gaming platforms are doomed to fail.
The gaming industry in retrospect
For the last 20 years, many companies have tried their hand at building gaming platforms, but only a few survived. You might recall failed consoles like the Sega Dreamcast, Valve Steam Machine, Ouya, and Apple Pippin, while you have Onlive and Gaikai on the cloud end of this spectrum. In the end, the market was only able to sustain four platforms: PC, Nintendo, PlayStation, and Xbox.
Enter the age of cloud gaming. In addition to the big four platforms, a bunch of new companies have thrown their hats in the ring. Here’s a quick list of the top contenders, with more likely to emerge in the coming years:
Google Stadia
Amazon Luna
NVIDIA GeForce Now
Xbox Cloud Gaming
PlayStation Now
Shadow Blade
Facebook Cloud Games
Netflix
Three reasons why some cloud gaming platforms will fail
While cloud gaming is an exciting and emerging segment in the larger gaming industry, there are several reasons why many of these platforms will either fail, pivot, or merge with competitors to stay afloat.
Market oversaturation: Every healthy market needs a stable source of supply and demand. If either of these become unbalanced, things can go awry. The number of players willing to try cloud gaming — much less abandon their consoles for it — is already low today. Add in the fact that cloud gaming platforms are emerging at a rapid rate, and it’s clear to see what there simply aren’t enough players to go around. As even more platforms join the race, playerbases will be spread even thinner, at least until more gamers come around to the idea of playing games in the cloud, which could take up to a decade.
Developer apprehension: All emerging game platforms inevitably need games. Developers already have their hands pretty full with maintaining ports for established platforms, like PC, PlayStation, Xbox, and the Switch. As we’ve seen so far with Stadia and Luna, these same devs have been apprehensive to spend dollars and resources on porting their titles over to the unproven cloud, unless serious cash is involved. Even for developers who have taken the risk, the cloud version of their games often lack consistent updates, leaving these titles bugged or unplayable for many gamers. Add in a dozen more cloud gaming services, and developers will undoubtedly pick and choose which platforms to support while seemingly leaving others out to dry.
Long-term funding challenges: To put it bluntly, cloud gaming server farms equipped with high-end GPUs and other cutting-edge tech are expensive, both to build and maintain. Add this on top of the money paid out to devs to port their games, new player marketing, and player retention efforts (through means of discounted games and other incentives), and expenses can rack up quickly. The only way to recoup these costs is through a consistent, hungry userbase. If there aren’t enough paying players for any given platform, it will have no choice but to pivot, shut down, or merge with another group.
The path to (potential) success
It should be noted that massive companies like Google, Amazon, and Microsoft are aware of the costs and risks associated with the gaming market. They also recognize the multi-billion dollar industry gaming has become, as well as the opportunities it could unlock, if successful.
This is likely why only the companies with the deepest pockets are in the cloud gaming race right now. As to how they plan to overcome the hurdles along the path to potential success, it’s hard to say.