Sony’s not enjoyed much financial success lately. The company has been bleeding money for years, primarily due to its diminished relevance in the consumer electronics sector. Where the Japanese giant was once considered the market leader, it’s been outmuscled by more versatile competitors such as Apple, Samsung, and even LG. The task has fallen upon former PlayStation president Kaz Hirai to turn the organisation’s fortunes around, and there are signs that things are gradually starting to improve, even if there is still a long road ahead.
But the firm’s financial predicament proves just how important Gaikai is to PlayStation’s plans. Despite being deep in the red, the organisation scraped together the resources required to acquire Earthworm Jim developer David Perry’s streaming company for $380 million in July last year. That’s not a trivial figure for any business, let alone one desperate to end a streak of straight losses. Clearly, the platform holder has high expectations for the purchase.
A report posted by the Wall Street Journal overnight suggested that the company will use Gaikai’s proprietary technology to stream PlayStation 3 games to its next console, a feature that will allow it to overcome the backward compatibility challenges that its upcoming system is almost certain to face. But in focusing on that one aspect of the initiative, it’s clear that pundits are overlooking the true value of the acquisition.
Prior to being purchased, Gaikai’s primary asset was as a marketing tool. It allowed publishers – Electronic Arts and Ubisoft were some of the earliest adopters – to embed working demos of their latest releases directly into websites and storefronts, allowing potential consumers to sample products from the confines of their web browser, before being encouraged to unlock the full experience. The true genius of the cloud technology is that it doesn’t require downloads, external accessories, or even particularly powerful hardware. All it demands is a decent Internet connection. Now imagine what that could mean for the future of PlayStation.
To the dismay of some, gaming is becoming less and less about consoles. More people are spending money and time on other devices. Facebook has seen an explosion in regards to player numbers over the past five years, while the impact of smartphones is a common talking point within the industry right now. The really exciting thing, though, is that Gaikai could give PlayStation easy access to these lucrative markets.
Sony may be planning to unlock PS3 streaming on its next system, but why would it stop there? The ability to unlock the entire brand’s back catalogue is not entirely out of the question – and what’s even better is that it would be available on-demand. Imagine being able to play Killzone 3 via Facebook on your netbook, or Journey in a cafe on your smartphone. It may read like a pipedream, but it’s a reality. Gaikai has already proven as an independent organisation that this is all possible, and now that it’s partnered with PlayStation, the service’s relevance is only going to grow.
None of this will occur overnight, of course, and it’s important to keep that in mind. As already reported, next week’s PlayStation Meeting will probably bring confirmation of the service’s integration into the PS4 and little more. There may be vague hints at the PlayStation Vita and other devices, but we doubt that there will be demos or any firm plans. The platform holder’s only had around six months to work with Gaikai, and these things take time.
Whatever is announced, though, it’s important to remember that the functionality won't be free. Those of you expecting cloud streaming as a replacement for backward compatibility will come away disappointed. While it’s possible that the technology will be billed as a solution for legacy support, you’ll almost certainly still have to pay for the privilege. The infrastructure costs associated with streaming are astronomical, and it’s unreasonable to expect free cloud access to a title just because you already own the disc.
Presumably you’ll be able to rent games for a set length of time, but we suspect that there may also be a subscription option, providing you with unlimited access to content in return for a monthly fee. Netflix has already had tremendous success in this area, so it’s not unreasonable to imagine the same model working with games. On-demand entry to a growing back catalogue of PlayStation content certainly sounds appealing from where we’re sitting.
However, it’s not until the feature is ubiquitous that it will truly start to shine. Its integration into the PS4 is all but guaranteed at this point, but it’s the prospect of being able to stream content to other devices that is truly tantalising. Soon you may not even need to own a PlayStation console to play titles such as Heavy Rain and LittleBigPlanet – and while that sounds dangerous in the short-term, you can bet that Sony’s forward-thinking will pay serious dividends in the future.
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