10:10am PT by Patrick Shanley
When Will "Netflix for Games" Become a Reality?
Is a "Netflix for games" coming this year?
As the video game industry posts record profits ($43 billion in U.S. revenue in 2018), some of the world's most valuable technology companies are said to be working on gaming-focused streaming services. In October, Microsoft unveiled plans for Project xCloud, billed as a "global game-streaming technology" that CEO Satya Nadella compared to Netflix.
Google also is testing whether its cloud drive could stream major game titles and teased an upcoming presentation at the Game Developers Conference in San Francisco next month that is rumored to reveal their plans for game streaming. In December, the tech giant offered a free copy of Assassin's Creed Odyssey to users who played a demo of the game on its Project Stream service. And a Jan. 28 report indicated that Apple had joined Amazon and Verizon in exploring services of their own.
Subscription-based game services aren't new; Sony and Microsoft offer programs that curate titles to users for a monthly fee. According to a recent NPD Group report, U.S. spending on such subscriptions grew 42 percent to approximately $3 billion in 2018. As digital gaming sales continue to rise, streaming services that host exclusive titles and marquee games could garner a share of the sales for themselves, as platforms like Steam and the Epic Games Store already do.
However, a Netflix-style hub that offers gamers a variety of titles to choose from without the need for a console is something that mostly only exists for indie games at the moment, such as on platforms like Steam. Meanwhile, many major game studios have begun offering their own online distribution platforms for their own titles, like Blizzard's Battle.net or EA's Origin. Given the wide range of consoles and platforms that gamers use to play games, creating a central hub with enough attractive AAA titles to lure in new users is a massive challenge, and would also require courting studios that may simply choose to offer their own subscription service.
"We saw four or five announcements over the last couple of weeks, so everyone is going to be the 'Netflix of games,'" Entertainment Software Association CEO and acting president Stan Pierre-Louis told The Hollywood Reporter at last week's D.I.C.E. Summit in Las Vegas. "It’s going to be dependent on the strength of broadband, so getting to 5G is very interesting to us. Seeing where broadband goes will tell you where streaming for games goes."
There's skepticism that non-gaming companies will succeed in licensing top titles for their subscription services. "Apple won't get Microsoft, Sony, EA or Activision content, so its subscription is dead on arrival," warns Wedbush analyst Michael Pachter, who suggests that an iTunes model might work better for the music download pioneer. "They could try an a la carte game download service and see if it works before trying to launch a subscription service."
Meanwhile, game developers such as Quantic Dream co-founder David Cage see such services as an inevitability for the future of gaming but notes that competition will be fierce.
"Competition between different platforms brings two pieces of good news," Cage told THR. "The first one is for players: they will have many options to choose from and, hopefully, the price of games will benefit from the competition. The second good news is for developers: it means that content is going to be king, maybe even more than before, and that there will also be a competition to sign the best studios and the best projects between all platforms."
Veteran game writer and director Amy Hennig, whose credits include Naughty Dog's Uncharted series, also sees streaming as an exciting turning point for the industry. "It will allow us to reach a much wider audience that right now is completely unserved," she said. I think if we crafted something that was experiential and wasn’t about mastery, difficulty, competition, all that, but a story that they could interact with and experience tactilely, I think it would be revelatory for them."
Hennig is quick to note the difference between streaming games and other media, however. "It’s not the streaming that we see already in music and TV and movies, but actual real-time content streaming directly to our devices. Unlocking that for audiences would have people go, 'Holy crap!' and be mindblowing for them. It's about meeting them where they're at and what they're familiar with."