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.
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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.
Are you excited by the prospect of cloud gaming? (24 votes)
- Sign me up now
- I still need more information
- Urgh, it'll never work
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Comments 23
Eh, I think that if pulled off right, it could be a decent addition. But due to the fact that i prefer having a Retail disc, I don't see myself using it too often
I'm curious, though: do you guys use Netflix?
@get2sammyb I do. It shows some of the best strengths and biggest weaknesses of cloud gaming, from my perspective. It can be great and convenient when it works right, but if you've got a crappy connection or are watching at a time when many others are, then you've got a lower resolution, or even worse, buffering. I don't want that in my games.
I have Netflix and hulu plus as a replacement for cable. I actually enjoy those relatively cheap subscription models. I think I would prefer renting games individually however, instead of adding another monthly bill, unless the catalog is vast and the service is cheap, or if they simply include it with PS+.
PS + = The whole ps3 catalog to play for just 60 dollars a year ? I think this is going to be what they will announce. This will convince people to give sony their 60 dollars , play all their games right of the start.
@get2sammyb I don't use Netflix. Sony letting people Killzone on Facebook would destroy Playstation. People could easily think that getting a playstation console is useless if they do this. Then less people would buy playstations further messing things up and then I don't see Facebook getting too many players for Killzone. Plus this would kill off many PS3 sales and then if Sony exclusives are available on Facebook why not just get an X-box which will happen with a lot of people. Sony will cut their arm (maybe leg their leg too) off if they do this. Plus controllering a lot if games I a tablet would be a nightmare which would hurt the reputation of Sony even further.
@Jaz007 It's important to remember that this probably won't work for PS4 games at first, so it'd be specifically PS3, PS2, PSone games that would be streamable. It also wouldn't be free, so Sony would still be making money.
I can see where you're coming from, though. The question is: are consoles even going to be relevent after the next generation is over? Pushing cloud gaming now could give it a serious advantage over the competition.
Great idea in my opinion.
I think Sony will need to make crucial decisions now that they went all the way buying Gaikai to be the first to strike the market.
Here is how I would introduce it.
1) Introducing Gaikai as a mean to enjoy old Playstation successful titles, while slowly integrate with old PSP titles for the PSVita and Sony Xperia.
With more than thousands titles from the PSX all the way to PS3 latest addictions, this is surely something that will take years.
2) The one above is a very solid base, the next step could be something totally groundshaking, one of the first party Playstation games played on PC.
3) From that point, proceeding to other competitor devices, such as iOS, or Samsung, Ouya etc.
I also want to point that im sure they will keep consoles for the time being, the thing is, those consoles will probably be different from what we are used to see, probably more similar to clients with their own screen, something more independent and yeah I think everyone can still go and buy physical games for local play (as far as I know, you can't download the game itself over Gaikai, only pay the service and play on demand).
I think its a given that the Ps4 wont try to do emulation seen as its proved difficult with PS3 and it would help to reduce costs straight out of the gate. Personally I like the idea of cloud gaming for backwards compatibility. Bandwidth and speed isn't an issue for me being on a fibre-optic network so the only thing to ponder is catalogue, maybe cost. If at least half of the back catalogues were made available it'ddefinitely be worth it. Id prefer a monthly subscription based model myself, but I do think theyd be shooting themselves in the foot if they didn't offer singular rentals as well though.
cloud gaming can work, but it's not something I'm at all interested in
@get2sammyb I used netflix abit, but in Canada, Netflix is TERRBILE!!!!! I would prefer a more anime on-demand service if they ever made one, not Neon Alley that's more like a tv station on my tv
Genius! I am only worried about the internet speeds required. I am in the us and norm seems to b 15mbps.
@get2sammyb There are a few things that would still make consoles relevant after this gen I think. Not everyone will want to pay a large subscription fee for games, it would cost at $60 a month which I think could turn a lot of people off especially since you would lose every game If you didn't pay. The new innovations with the Wii U and the dualshock 4 (probably) will make it harder or impossible to put games on other devices since they would use and maybe even require the controller's new inputs (unless if course they sell streaming devices with controllers). It would require you to be always online which would be a large turn off for a lot of people. How would you divide the money to the people who make the games? That would be pretty complicated.
If they charge a reasonable fee with a couple different options I think it would work pretty well. Maybe give PS+ subscribers either free access or a nice discount so that having PS+ along side Gaikai is more affordable than a stand-alone package. They could also keep certain games (besides the current console) as Playstation exclusives like cable/satellite companies usually do with certain programs.
One of the big problems besides things like internet connections and server load would be licensing agreements. If Sony can't strike a deal with a certain developer/publisher or they just flat out decide to take a game down thats it. We've already seen it happen with Sega taking down PSP2.
If they do this properly it could be a massive selling point for ps4, I.e not a monthly charge, maybe have 2 levels of ps+, 1 as it is now with out streaming and a second level with unlimited streaming.
They need to offer decent levels of content from day 1,
Allow streaming to vita in the near future.
I'm not sure how I feel about something like this mainly because it doesn't exist. I'd be worried that it will rely too heavily on bandwidth and cause performance issues sometimes. For me, steaming a game and movie are two different things. If Netflix messes up, I can relaunch and manually pick up where I left off. Let's say I'm playing DmC and I just finished getting a SSS on Dante Must Die difficulty and the connection drops and I lose my place. I cannot simply go back to where I was (likely).
The whole idea of streaming games makes me a bit uncomfortable because it's just one more thing to go wrong (even if it's minor). If my internet goes down for some reason or if it's being unreasonably slow, I'd be out of luck. I'd rather spend an hour or so of my internet downloading the game than trying to stream.
Another issue that worries me is that even if they offer PS3 games for steaming with this service, it's likely I'd have to re-purchase those games. I'm not buying a PS4 to play my PS3 games, but if it's labeled as supporting PS3 games, I'd rather it be native rather than some streaming service.
@nathanuc1988 I understand where you're coming from completely, I really do. But, the dedicated gaming industry is moving in such a way that they've got to become profitable to continue growing in a forward direction - whether that's digital downloads or digital streaming - it's the future of gaming, at some point in time.
I think this is a great 'first step' on Sony's end. This upcoming generation will most likely stay relevant for another 6-8 years - giving Internet providers more time to improve their services. But, in my opinion, the following generation thereafter, you will most likely have to have a high-end Internet connection. If you don't, then well... sorry. At some point this industry will have to move forward, even if that alienates a certain demographic.
As for bandwidth issues with Gaikai. I'm not sure, as I haven't used the service, but I'd like to think that for gaming purposes it would buffer far more than your typical Internet movie service.
i'm not a big fan of cloud gaming but maybe if they used it right it may work
I don't get "cloud gaming'. I get rental services. I used GameTap a few years back. A monthly rental fee gave me access to plenty of old games and introduced me to Darkstalkers and Metalslug. Apparently it still exists.
http://retro-games.gametap.com/
But every game I played was DL to my PC. Gamefly has a similar - but much more catalog limited - service. And despite how Sony advertises PS+ it is a game rental service. And with the PS3 having 500GB HDD I expect 500 to be the base PS4 w/ maybe 1TB for the premium. So why do we need cloud streaming? Why can't we just rent stuff and DL it like we already do w/ PS+?
So that's why I voted "I still need more information".
15mbps is sooo fast compared to people I know. I have 5mb and others have like 768kb... I can't see it functioning well with anything under 10 or so, which is a no-go for me. After Vita's remote play never being able to even connect, I'm not optimistic yet. Netflix baaarely works for me, and I'd like for ps4 to be very diff from that experience
Maybe, for now, the streaming thing could simply works in such a way it will seemingly transfer data in your HDD, allowing you to play once 1/4 of it is stored, with the feature to save what you have already got, and resume if you connection drops or you turn off the console (by that I mean plugging it off completely).
Of course you need to subscribe and create an account.
This could work even if you can't get a decent connection, I watch satellite TV shows this way, and believe me I have a very bad connection, all you need is to plan it so you know you can play the next day.
I go over and say this might be how we will get the backward compatibility.
Cloud gaming in itself is, simply put, still to be throughly tested, and a fiber connection needs to become a common thing before we will see anything worthy.
When the majority of the world has 50-100 mb/s connections, it will change everything and the possibilities are endless. Traditional TV gone. Need for large local HDDs gone. Streaming of everything and anything. etc etc etc.
It will have just as big an impact as when the internet or TV was first invented.
Sony must be ready and Gaikai is their ticket.
Those speeds are coming. For many countries (e.g Japan/Korea) that is already true. Australia is currently rolling out a new fiber network that should reach a large % by end of 2015, with predicted speed of 100mb/s (depending on contract).
Other countries will also have initiatives.
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