Google has a rapport for killing many of its products, we all know the big ones but the list really is endless. With the recent closure of all First Party Stadia game studios, many people hypothesize, this is beginning of the end for Stadia. The cloud gaming service from google is still riddled with problems and faces fierce competition from established competitors like Nvidia and Microsoft, but here I make a case for Stadia and why Google is extremely unlikely to give up on the platform anytime soon.
Does Gaming Have A Future On Cloud?
Games generally get better with every passing year, mostly with the combination of better hardware and relentless devs always looking to push the boundaries of what’s possible. The one constant however is that bulky box below your screen that powers it all, sure the box gets better with time but its still there and this is exactly what cloud gaming is aiming to disrupt. Yes, fundamental problems of the cloud like latency and picture quality still remain an issue, but I think some major cloud services are at a decent enough point where the average user won’t notice much of a difference (Obviously depending on the type of game and the user’s connection to the host server).
Cloud gaming is still at its nascent stage and there’s no knowing when or if at all a radicle shift is going to happen, but many big companies even the likes Sony and Microsoft (who are in the business of selling physical consoles) are dipping their toes in cloud and there’s some incentive to do so, selling physical hardware is not very profitable, both Sony and Microsoft barely make a profit on the consoles they sell, the only aim of that box is to get people invested in an ecosystem which is going to generate returns in the long term. This doesn’t mean they will be happy to ditch their consoles anytime soon, in-fact delivering their ecosystems through physical boxes is way more economical than creating the infrastructure needed for a good cloud gaming experience. I think for both Sony and Microsoft the need to make cloud gaming a core offering arises from a fear of getting caught off-guard if there’s a shift in how games are played. This ensures the Xbox and PlayStation brands are well prepared for a possible disruption.
For cloud to be a viable alternative to physical hardware a lot of problems will have to be solved and most of them are fundamental physical problems that are extremely resource intensive to fix. On a very basic level when you play games on the cloud you send inputs to the server hosting the game, this is then rendered there and sent to a video encoder and then that is streamed back to your display. This may sound simple but this has to happen real-time with the lowest amount of latency. So a provider not only has to optimize the rendering and encoding to reduce input lag, they will also have to take care of delivery. For all cloud gaming providers this is a very big challenge since the best solution is to have a server as close to the client as possible and this makes deployment even more expensive since you can’t have scale efficiency by stacking everything in a single location.
As things stand today, cloud gaming should be a very decent experience for most people provided their internet isn’t a bottleneck. Cyberpunk 2077 was a disaster on older generation consoles but if you play this game on Google’s Stadia platform, the experience is very comparable to a new Xbox Series X. The mileage will also vary on the game as input lag is way more noticeable on fast paced shooters than say a RPG game.
Google’s Edge On Cloud
When you game on the cloud the server hosting you has to use a lot more bandwidth to send the data back compared to say watching a video stream because the former doesn’t compress as well. This raises operational costs a lot and its harder for providers to come to a pricing model that can be profitable in the long run. Also if you factor in the significantly increased costs of renting servers with GPUs the situation gets trickier.
This is where Google’s edge comes to play, due to their size and scale they pay a significantly lower cost for bandwidth and instead of renting servers they can afford to build hyper-locale data centers in-house giving them more granular control over player experience. Google also owns massive optical fiber networks so that can enable superior routing for users.
Right now Stadia offers the best streaming quality out of all services provided other factors remain the same(Internet, Distance to server), and this mostly stems from the tech advantage they have over most players. Where they fail to compete is the ecosystem and pair that with the absurd pricing on launch you have a recipe for disaster, but in light of recent announcements I think Google has taken a step back to reconsider Stadia’s direction as a platform.
How Stadia Might Change For the Better
No doubt Google started on the wrong foot with Stadia, they assumed that a Play Store like model would work where users will buy games separately on the platform and Google gets to keep a percentage. Users also had to pay a monthly subscription which made things even worse. This approach made a lot of sense for Google because Stadia would have had the potential to become a big marketplace, which again is very profitable.
Obviously this didn’t work for a couple of reasons, Cloud Gaming is still a very unproven platform, nobody is going to shell out 60$ for a AAA game that is locked to Stadia, moreover consumers have other options too which are far more economical. Nvidia for example has a flat subscription fees and users can play almost any game they own on other platforms, unless the developer specifically opts out.
Google was hoping to mitigate this by creating exclusive games for Stadia from their own First-Party studios, games that could showcase the platform’s power. But again this wouldn’t work, creating games of that scope is a very costly affair and to create a catalog comparable to the likes on Sony and Microsoft would take years. Google obviously realized this from initial public reaction and closed all of its First Party Studios.
Some people also speculate that instead of keeping Stadia around, Google can directly offer the tech to other publishers and developers who can then use it to build their own cloud platform. This again is very unlikely as losing Stadia would mean a big opportunity loss for Google. For a company that owns a mobile OS powering over 85 percent smart phones, killing Stadia is a no brainer. With the rising prevalence of phones as a viable gaming device, Stadia’s eventual integration on Android can be a game changer.
Concluding, it is very unlikely that Google kills Stadia in the near future, for the opportunity cost would be far too great for Google to exit at this stage. We are already seeing corrections in Google’s approach and they are now more focused on expanding the game catalog on Stadia. There’s also more focus on bundling games with a Stadia subscription and the introduction of Ubisoft+ on the platform was a great first step.