Microsoft and Sony have established a relative see-saw competitive relationship that dates as far back as many gamers can remember, however, as Sony is rumored to be waiting on the Xbox team to reveal its pricing for its next-gen console, seemingly in an effort to continue their historic rivalry, Microsoft may be looking beyond the Playstation as its adversary in the future.
The head of Xbox, Phil Spencer spoke with Protocol about Why big tech is betting big on gaming in 2020. During his discussion with Protocol, Spencer acknowledges that Sony and Nintendo present a clear and present obstacle to the more immediate success of the Xbox division but that, ultimately, it's Amazon and Google that will be the division's main competitors in the near future.
When you talk about Nintendo and Sony, we have a ton of respect for them, but we see Amazon and Google as the main competitors going forward," Spencer said. "That's not to disrespect Nintendo and Sony, but the traditional gaming companies are somewhat out of position. I guess they could try to re-create Azure, but we've invested tens of billions of dollars in cloud over the years.
While it may seem a bit dismissive and a shifting of the goal post for staunch console advocates, the reality is that Microsoft has been gearing up for cloud war with both Google and Amazon for close to a decade now and it's only recent moves by the former businesses into gaming that's set a collision course for the big three. With Google going all-in on its Stadia streaming service and Amazon acquiring the largest gameplay stream service online in Twitch as well as preparing to launch its own streaming game service, Microsoft's new xCloud efforts will be the company's foot-in-the-door to serving the next 7 billion potential gamers in the cloud.
For Nintendo and Sony, to a lesser extent, the companies seemingly don't have the cloud-scale to compete on the same level as Amazon, Google or Microsoft when it comes to hosting games, development environments, streaming to connected devices or localized data centers to provide similar cloud-based gaming experiences. While Sony is arguably the current leader in game streaming with Sony Now that hosts over 800 games and 1 million-plus subscribers across nineteen different countries, even the Playstation division has come to the realization that it'll need a little help with its cloud infrastructure going forward and recently partnered with Microsoft to scale their experiences.
I don't want to be in a fight over format wars with those guys while Amazon and Google are focusing on how to get gaming to 7 billion people around the world. Ultimately, that's the goal.
The pivot to publically targeting new opponents while current ones are seemingly chomping up market share might make for a great marketing strategy, but as with most things in gaming and tech, the proof will be in the execution and tangibles. Right now, cloud-based game streaming is a nascent market that's arguably being bungled by current players, with Sony's limited marketing of its product, Stadia's over-promised performance and gaming library experiences and Amazon's big streaming purchase falling victim to moderation and content provider issues, but the inevitably, the sector will improve and only a handful of competitors can sustain continued competition in it, and right now, Sony and Nintendo don't have the infrastructure to springboard their good ol' console war into the next frontier.