![]() He expects Microsoft to be making Xboxes for “years and years”. Mr Spencer says it is hard to beat the reliability of a console. “ said, ‘It’s going to be awesome from day one.’ And then that wasn’t true, and I think they turned consumers off as a result,” says Strauss Zelnick, head of Take-Two Interactive, some of whose games were on the platform. Stadia worked well but was not the console replacement that some had expected. Games’ interactivity makes them less forgiving than video or music over “latency”, or internet speed. Google closed its Stadia game-streaming service in January after barely three years. ![]() “We definitely find more and more customers where streaming is the only platform we see them on.” In some markets nearly a third of Xbox customers play only by streaming, he says. Phil Spencer, chief executive of Microsoft’s gaming division, sees its potential audience as not just 200m households with a console, but 3bn-plus people who play games on any device. Removing specialised hardware opens a bigger market. Users can start a game on their TV and pick it up later on their phone or laptop. Streaming allows a game to be processed in a remote data centre, while its video and audio are relayed to the user’s screen, so the latest games can be played on any internet-connected device. The most demanding so-called AAA games require users to invest in expensive, often bulky hardware, in the form of a high-end PC or console. Streaming games may be more rewarding than streaming music or TV. Netflix, which began offering mobile games just over a year ago, says it is “seriously exploring” launching a streaming service. Amazon has one called Luna, available only in America. Nvidia has a game-streaming platform called GEForce Now. Sony’s PlayStation Plus Premium offers streaming to its console and to PCs. Microsoft’s Xbox Game Pass Ultimate service lets users stream games to devices ranging from phones to smart- TVs. Streaming-only services account for less than 1% of games spending, says Ampere Analysis, a research firm. The twin innovations of streaming and subscription could “reshape the competitive landscape” of the gaming industry, says the Competition and Markets Authority, Britain’s antitrust regulator. And companies are trying out subscription access to game libraries, rather than selling games as one-off purchases. Technology now allows them to be streamed over the internet, Spotify-style. Like records or DVDs, video games once came in boxes. Many wonder if streaming could now disrupt another media industry. Streaming accounts for over a quarter of TV viewing in America. Most Hollywood studios now have their own streaming platform, selling shows direct to consumers. Netflix has since done something similar for movies. Streaming now generates two-thirds of the recorded-music industry’s revenue. Similar services were offered by Apple and Amazon. In 2008 Spotify began offering online access to a catalogue of music for $10 a month. Over the past 15 years the music and TV industries have seen huge changes in digital-media distribution.
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