Sony’s recent acquisition of cloud gaming company GaiKai, prompts TechCrunch to question if Sony may consider releasing a cloud-based gaming service rather than an expensive console device.
Typically, companies sell the expensive consoles at a loss, hoping to profit from the sales of games and other services. But cloud-based services could dramatically reduce the costs for consumers and allow the companies to profit more quickly. A cloud-based console could sell for as little as $100.
However, there are problems with cloud-based gaming, starting with the fact that Sony does not have the infrastructure in place to host a full network of cloud-based gamers. Building such a network would be expensive.
Cable companies also have begun to introduce tiered broadband plans. Cloud-based gaming would stream HD content, which could require a a great deal of bandwidth, even for casual gamers. Hardcore gamers would rack up enormous cable bills, which would essentially punish the company’s most valued customers.
However, a low-cost game console could attract new customers and free the likes of Microsoft and Sony to create services that are not tied to a specific piece of hardware.
“Making gaming a streaming service rather than based on the physical purchase of games also opens up new potential business models,” suggests TechCrunch. “Xbox Live already has a membership fee attached, and subscription games — where you get the software for free but then pay a monthly fee to access the game online — are nothing new, particularly in the MMORPG world. But without the need for physical downloads or actual distribution of discs to consumers, subscriptions could become even more popular for cloud-powered games.”
Sony’s recent acquisition of cloud gaming company GaiKai, prompts TechCrunch to question if Sony may consider releasing a cloud-based gaming service rather than an expensive console device.
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