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Google’s recent decision to close its dedicated game studios — opened to much fanfare just two years ago — has been seen by some as an admission of failure; another big tech brand that doesn’t quite “get” gaming.
It can’t have been an easy decision, and thoughts naturally turn to the 150 developers now looking for new jobs in a challenging market. But the existing strategy was trying to be all things to all people. This pivot could see Stadia become a proper games-as-a-service business, rather than a console that happens to be in the cloud.
Google may have only been aping the approach of platform holders by using exclusives as a way to tie gamers in for several years, but do we really need more of the same?
The quad-opoly of Sony, Microsoft, Nintendo, and PC games is already fragmented enough. One of the big benefits of cloud gaming is that the hardware becomes less of an issue, with the focus instead on consumer convenience and recurring subscription revenues for the providers. By closing its studios, Google can now focus on growing its subscriber base without the expensive distraction of making its own triple-A games.
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‘True’ cloud gaming vs console-in-the-cloud
Streaming games via the cloud is not as simple as merely uploading a game to a remote server. The amount of work needed to prepare a game to run from the cloud varies depending on the platform you are porting from and the game’s technical requirements.
In the case of Stadia, porting becomes even more expensive and complex if you want the game to make use of Google’s “exclusive” features like State Share, Crowd Choice and Screen Connect. If your objective is to launch a crossplay game on as many platforms as possible, platform-specific features are a problem that adds cost and complexity and narrows your potential audience.
But the whole point of cloud gaming is to broaden the audience. Clever features are fine if you want to offer something unique, but your customers need to be able to experience them in the first place, and publishers need to see the benefits to any extra cost and time to port their games.
If we look at some of the most successful games of the past couple of years, they are designed to allow owners of different gaming platforms to play together seamlessly. In short, they are designed to be played by as many people as possible, and depend on the scale of player numbers to generate revenues. That’s essentially the same games-as-a-service model as cloud gaming services.
So if game publishers are becoming less tied to specific hardware, and cloud gaming is about trying to be platform-agnostic, what does this mean for the games industry in the near future?
Cross-play games and services mean a change to traditional game licensing
Remember Sony trying to block console crossplay on Fortnite before a backlash forced it into a U-turn?
It’s a good job Sony did, considering the impact Fortnite and other games like it have had on a new generation of gamers. In 2018, Fortnite got credit for enormous revenue leaps seen for both Sony and Microsoft. And one of the hit games of 2020, Genshin Impact, offers the most comprehensive cross-play we’ve seen so far, with support PC, PS5, PS4, iOS, and Android. Crossplay helps everyone win.
Some, though, are still holding onto the traditional licensing model for dear life. Ubisoft’s Immortals: Fenyx Rising is a great example of where forward-looking ideas of cross-play meets old fashioned, backwards-looking restrictive licensing.
Fenyx Rising was promoted as being cross-platform video game on its launch thanks to its Ubisoft Connect system which uses the cloud to store progress. Players can save their progress on one device, and pick it up again on another. But If you want to replicate the above scenario yourself and continue playing on a different console when travelling, then you’ll still have to own another copy of Fenyx Rising for that particular platform.
Sure, gamers are being given the ability to keep their progression across different platforms as promised- but only if they want to buy multiple copies of the same game.
Ubisoft also highlights on its website that some content purchases can’t be shared cross-platform such as credits purchased, DLC, season passes and more. Many were quick to highlight this across social media, questioning whether Fenyx Rising could really be called a true crossplay experience.
Suddenly, cross-playing Fenyx Rising looks to be an expensive proposition for the average gamer. As Sony found with Fortnite, there are other ways to make money from cross-play that don’t rely on a very skewed view of the definition of cross-play.
I believe that for big-budget games in the future, true crossplay is essential for longevity and financial success. Bungie’s Destiny 2 has shifted to follow this cross-play model, with cross-play between PC, console and Google Stadia due soon, and GTA5 is another title where cross-play is expected to happen.
With triple-A games costing hundreds of millions to develop even without the cost of updates and ongoing support, a games-as-a-service approach makes financial sense. Although these games are not yet cross-playable on cloud gaming services, it’s just a matter of time.
The cloud brings crossplay without the caveats
This is why I believe that there will be benefits to Google closing Stadia’s development studios. By no longer competing with PlayStation, Xbox, and so on, Stadia can concentrate on licensing third-party games and attracting a broader audience, and it gives publishers like Epic, Rockstar, Bungie and many others an even more compelling reason to make their games playable on cloud services.
There is a huge mainstream audience of gamers out there who are hungry for new cross-play experiences; the type that a well-worked and affordable gaming streaming service can provide.
The data we have from Blacknut subscribers shows those playing across two devices spend almost five times more time more playing, while those playing across four or more devices (so for example across a TV, laptop, mobile and desktop PC) are spending eight times more playing games. Subscribers can access the full catalogue of games valued at over $6,000, for a monthly subscription fee of $16.
After a relatively slow start, we are now finding many more publishers interested in the opportunities offered by cloud gaming services. As cloud gaming subscriptions increase, it can only make the case for true crossplay gaming between console, PC and the cloud much stronger.
It also never hurts to have a company the size of Google endorsing the same business model as Blacknut and other cloud gaming platforms. After all, the more we can all raise awareness of cloud gaming services, the more new gamers we can get buying and playing games.
With over 20 years of experience in digital, data, and performance-based marketing, along with being a digital mum and gamer, Daphne Parot is the chief marketing officer (CMO) for cloud gaming company Blacknut.
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