The effect of Google Stadia on the gaming industry

Starting this as a general discussion thread.

For now, it looks like Google is presenting a powerful challenge to the hardware-based business model's of the majors, and even the entire PC gaming industry.

The PC gaming industry has ridden YouTube's ascent, but if you no longer need the home rig, that entire industry might evaporate over the next decade.

It will be fascinating to see Microsoft's response to this. They've shifted hard away from software to cloud computing, but can they compete in the gaming space? Is Microsoft talking about minimizing Xbox now, or shifting it to a dev studio that develops for Stadia?

Anyway, here are two posts with some business info on Stadia for devs

https://web.archive.org/web/20190320054552/https://www.stadia.dev/blog/welcome-to-stadia/

https://web.archive.org/web/20190320152231/https://stadia.dev/blog/announcing-stadia-partners-free-development-hardware-for-selected-developers/

One more thing: Google's entry could be really good for Sony, Microsoft, and Nintendo because it will force them to decide if they commit to hardware or shift to cloud developing.

If they remain committed to hardware, they will have to find a way to make those boxes appealing besides the POWER argument. They won't be able to compete on computing power with boxes, probably.

Nintendo is really well-positioned on this because it has focused on things other than POWER for a while now.

But what do Sony and Microsoft have besides the POWER branding to sell hardware now that they cannot compete on power at all?

Their answer to that question could see some really cool innovation from those companies.

I don't see why Nintendo has to bend to anything. Their output is narrow enough to be controlled on their own terms. They are dipping into streaming but they'd need to make serious connections with a streaming service to make it work. Hell, Amazon, Google, etc could just land apps on Nintendo, Microsoft and Sony's platforms to get the best of both worlds.

I think if gaming really does go the way of Netflix I will probably stick with my old systems. I agree that Nintendo could be the only one left, especially if the service works on the Switch. Playstation and Xbox would have no reason to exist any longer. Unless they copy the Switch. Either way I'm not looking forward to any of this streaming games as a service.

It's all bad, i hate it all.
For me there's no part of a streaming service which is a positive.

in terms of the product google is selling- seems neat. could be great, could be lackluster- it might be a mix of both (great under ideal conditions with a small set of compelling exclusives, but then total poop when on a less-than-ideal connection). i'm withholding judgement until it's a real thing.

the thing I do worry about is the potential homogenizing effect this could have on the industry. if it all works flawlessly, and devs buy into google's business model (whatever that is)- it will blow up the existing industry, leaving google as the dominant player. and speaking frankly- the potential to compete against the deep infrastructure google has is next to nil.

sure Microsoft might have the capacity to make a similar investment to complete- but will they? not so sure.

it's based on a gut feeling- but I have a hunch that the industry is better off with a xbox, playstation, nvidia, amd, steam, epic, origin, etc. all competing for your dollar rather than everything being under one roof.

As cool as I think it is, this is all extremely scary. If this succeeds and works as advertised, it will destroy the need for both consoles and PCs(for gaming). Google will have a monopoly on the delivery system for games, unless other companies(namely Microsoft) can compete. Based on Phil Spencer's response to the Stadia announcement, I am confident Microsoft will get there.

All this said, the reaction to this announcement is the EXACT same as when streaming started becoming dominant in both music and video. Now, streaming is the accepted dominant form of delivery for those pieces of media and I see no reason gaming will be any different. The push to digital was the bridge between the "old" and the "new".

The real hurdles will take place outside of the industry itself. The infrastructure will need to adjust/settle for this to be successful. IMO, the answer is 5G. Capable of delivering speeds/low latency almost anywhere with relative ease and low cost. That is where the competition will come into place. Basically, console manufacturers will have to become telecommunication companies.

yeah- you're not wrong about this. I feel like this is the point in time where I have my 'old man yells at cloud' moment.

I will say, however, comparing to music specifically- i'm not sure recording artists are in a better place now with spotify and apple music than they were prior to streaming. their income has always been fraught- but if you maintain the comparison and start to wonder what happens to devs with google and/or Microsoft streaming everything- devs both big and small- it could get real dicey.

I think I'm with Jeff in that there's some interesting stuff they're doing, but it's also kind of terrifying to think about what it actually means for the future. Regardless of what I think, even if Stadia doesn't work out I believe we're inevitably heading towards a streaming future whether consumers agree they want it or not.

I can’t see how Sony survives if streaming games becomes the default business model. They’re networking stuff has proven to be terrible time and time again.

Nintendo is a different beast. They have enough multi- generationally loved properties to keep going how they are.

Microsoft is clearly running towards the same target as Google.

When do Apple, Amazon and Facebook get in on this? They can’t be far behind right?

This paradigm shift will be similar to what we've seen in the music and movie industries. There will be a small subset of enthusiasts who will still pay large amounts of money to run games locally (just like there are movie enthusiasts with expensive home theaters who still buy Blu-Rays for the best quality), but the vast majority of people will be fine with streaming games for a much lower cost (just like the vast majority of movie watchers don't mind Netflix compression).

The potential benefit I find most exciting is the near-removal of CPU/GPU limitations, i.e., the promise of games being able to use more than one Stadia instance to render a game, and the complete removal of storage limitations. In several years (this would require a lot of R&D), we could potentially see Stadia-exclusive games running on 5+ instances that are unlike anything even a top-tier PC can offer. Essentially you could have games with near-movie quality rendering and effects. I’ve heard people say that what’s the point if you still have compression, but I still think Avatar looks pretty good on Netflix. I immediately thought of games with the promise of No Man’s Sky but actually delivering on that promise, or the Star Citizen MMO without having to own a $2,000+ machine.

For those curious about performance and input latency, I highly recommend Digital Foundry's video here (or write-up here). TLDR is that they got hands-on, and measured input latency to be 166ms in AC: Odyssey on Chromebook. The interesting point is that this was identical to the input latency of the Xbox One X version of AC: Odyssey. Now, this is an ideal network scenario in a game which already has a lot of input latency due to its rendering pipeline, but still very promising. It will never be ideal for games demanding a lot of precision, but it seems that it can definitely work for a lot of games.

We won't own our games anymore, and with so many companies who want to go this route, there will be causalities. Suppose I sign up with Google and buy a few AAA titles. After 5 years, Google may decide to cut it's losses and close up shop. I'm screwed after that. And what will confuse the industry even more is if a big AAA title developer, like EA, decides it will go alone and create their own streaming service. Google has already stated they're going to make their own games. Google will then not be seen as a partner to these software companies, it will be a competitor.

One more thing that concerns me is that I may have to sign up for a subscription service with monthly fees on top of actually buying the game itself. Fuck that.

It's still too early to tell. What's the pricing structure going to be? Will the games run on a half-ass wireless connection? Will the library of games available the in first couple of years be big enough to get the "enthusiast" crowd to commit to the service? Will increasing bandwidth vs. poor broadband infrastructure end up making it cost prohibitive? There's just so many questions that still need to be answered.

Motion control was the next big thing. Lots of people predicted that games would be almost exclusive to phones a few years age. Apple was going to kill consoles. Microsoft was going in the direction of cloud computing with the launch of the Xone and that went over so poorly they had to abandon most of it. VR is still a very fringe thing. This could end up how most of us play games in ten years, but it could also end up being just another forgotten dongle in a box somewhere next to a bunch of UMD movies and a Connect camera.

@oldenglishc: In terms of running on poor wireless connections, Digital Foundry said they tested Stadia with an artificial 15mbps cap. They noted the input latency to increase from 166ms to 188ms, and saw the stream quality drop to 720p. This doesn't factor in packet loss/unstable connections, but in terms of poor bandwidth we've got a little data to work with.

It’s new, so it’s kinda cool and kinda scary.

It’s a hobby though, so I’ll go where the winds take me.

To me this all goes back to hardware buy-in. Most people on Giantbomb, myself included, have already done the hardware buy-in part, and own a PC and/or multiple consoles. Though billions of people in the world have not, and probably will not ever do the hardware buy-in that the traditional video game business wants them to.

Google marketing is going to try to convince everyone that this is the future. I'm highly skeptical because it's just not appealing if you've already done the hardware buy-in part. They would have to show fidelity BETTER than local hardware which is not possible with most ISPs. But if you just have a smart phone or a TV, a streaming service is WAY more attractive. They are going for the millions of smart phone users who never would have done the traditional path.

@pappafost: I think there's a use case for plenty of people who've already bought in to hardware: keep the dedicated hardware for competitive games, use Stadia for newer single-player experiences.

Consider myself, for instance. I've been more tuned-in recently to new mid-range GPU offerings, because I have a mid range PC with an aging GTX 970. In the particular case of AC: Odyssey, I get 45-50 fps at 1080p with multiple settings turned down. Now let's say the next AC game comes out on next-gen consoles and adds new graphical features, driving performance on my current machine down to 30-35 fps. At this point, do I upgrade my GPU for $250-300 and get back to 50-60fps, buy a new console for $400-500 to play at 60fps (not guaranteed by any means), or play the game on Stadia for a monthly fee at 60fps with some compression artifacts. I would lean towards Stadia, if the pricing model is reasonable. Now let's look at competitive games, maybe I play Apex, CS:GO, and Dota 2. With a mid-range GPU like a 970, I could play these competitive games locally for years, and with the way cross-platform play and backwards compatibility is going, likely play them with friends on next-gen hardware. But I could still play newer next-gen graphical showpieces via Stadia.

This is all hypothetical, because I haven't seen Stadia in action nor do I know its price. But I have 250mbps internet, so I'm not too worried on the ISP side. Stadia could really save me some money whenever next-gen games start to release.

I think the interesting question is does the casual audience who don’t own a console/pc even want to play these games? Is there a huge market of people out there interested in the big games but a $200-300 console purchase is too much?

On top of that are those same people likely to have a super fast, non data-capped internet connection? I doubt it

The bigger change in the short term might be to put pressure on ISP’s rather than drastically changing the games market overnight.

At my more cynical moments during and after the keynote: We're going to take the tribalism we are seeing return from the Steam/Epic debacle and crank it up. Instead of Sony and Nintendo it will be all about Twitch/Amazon and Youtube/Google and Mixer/MS. Fuck you you stupid Twatch, I play my games on Mixer.

At my more optimistic moments: We're seeing a return to games that actually push the technological envelope return as there are now reasons to target skus that are noticeably more powerful than an xbox.

Realistically speaking?

I don't see a huge change coming. Or, more pointedly, I don't see a change in the current trajectory. Multiplayer games and MMOs will probably switch to a more client-less model because of the security and even performance implications (dedicated servers without needing to actually make a dedicated server).

Singleplayer games can go either way, but I still see incentive for Google and Amazon to not want you to spend 300 hours playing Cyberpunk on their servers. Because monetizing that will be a nightmare (pay by the hour and nobody wants to use it for short stuff. Flat rate and they lose out). So stuff like that will still emphasize an "offline experience". And while MS may be potentially willing to throw in the towel on hardware, Sony and Nintendo aren't. And I also don't think MS is and we'll see timed exclusives and the like that use their hardware/windows store.

And my semi-realistic dream: Imagine you are watching your favorite youtubers play Mario Maker. They make an awesome map and push the button to push the state to The Cloud. I'm on my PC and I click the link and am suddenly playing that level on a Stadia server with an ad at the end saying "Wanna play this for real? Buy it mother fucker". Similarly, my friend is watching on his Switch, pulls out his phone, opens youtube, copies the link, pastes it in the nintendo app, and is then playing that level on a Stadia server.

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And one thing to remember: It may officially not be part of their plans right now (I haven't checked), but you'll notice they had some desktop looking towers on screen while they were talking about developers being able to debug and launch in The Cloud. Assuming this doesn't die in the next year, I give it two or three years before we see a "Stadia Computer" that is basically the desktop version of a node from their data centers that you can use as basically a console. Or, you know, a Steam Machine.

For me Sony are the big wildcard in the near future now. We know Microsoft is pivoting towards streaming and getting gamepass everywhere, what if Sony does what it did this time around and just doubles down on how we currently play games? It worked brilliantly for them this time when Microsoft was talking about always online and eliminating used games.

The world has changed since then but I can see them going with a message of ‘just buy the games and play them’ while doubts still remain about how accessible streaming will be outside the big cities and concerns about not owning games and them disappearing from something like gamepass

Lots of folks talking about how this affects game players.

But Google debuted this at GDC for a very specific reason: Google is competing for game developers, not players.

There are only so many devs to go around, and Google wants to make them an offer they can't refuse. Infrastructure wise, Google can't be beat. But what will the details be? How much will devs have to give Google for access to the platform? How difficult will it be for devs to learn Google's platform?

In one of Google's blog posts, they mention offering early adopters free hardware access. That means they will be charging devs for access to Stadia development infrastructure. What is that cost structure for devs? How does this work for deving on Sony/MSFT/Nintendo platforms currently?

One of the most interesting things to me is to think about how Google, Microsoft, Sony, and Nintendo perceive themselves as competing with one another in a marketplace for game developers.

Nintendo is pretty insulated from competition in that market for devs because they seem to have a strong in-house development team. They don't seem as reliant on third-party devs, so they don't have to compete with Sony/MSFT for them. But that is changing because the Switch turned out to be so popular with third-party devs. Sony/MSFT have fought over devs for a while, with things like the exclusive games and exclusive-for-x-amount of time deals.

So one thing that might keep Google from devouring the other majors if the other majors start offering incredible deals to developers to keep them away from Google. We're seeing some of this in the storefront fight for game players between Steam, Epic, EA, Xbox Game Pass, etc. Epic's free game every two weeks is an incredible deal for game players, and so is Game Pass.

If development platforms have to offer similarly great deals to get and retain devs...Stadia might make the next decade the best time to be making video games.

We'll see how all of this plays out soon enough.

Slim chance that I'll bail on putting PCs together since I'll still need a relatively decent one for my digital imaging and video editing needs, but also because I like having offline access to my games for that one time of the year when the internet doesn't work. Also, the impending ramifications of kneecapping net neutrality in the States and the possibility of having to pay for a "fast lane" as an additional ISP cost in order for Stadia to work as intended.

Sound cool, but I'm just not all that ready for an all internet based gaming service just yet. I still like my CDs, DVDs, Blu-rays and downloads with the respective electronics to play them on.

@stinger061 said:

I don't know, Phil Spencer has been relatively clear that while they are pursuing streaming they still absolutely intend to offer high-performance consoles for people that want that experience (at least for the near-future, which I take to mean at least the next console cycle). MS is big enough that they can pursue both paths simoultaneously, especially since other parts of MS (see: MS Office cloud services) are putting significant R&D into cloud services. Sony would appear to have the most to lose here.

This is true, but I would offer that the interactivity of games makes it a bit of a different scenario. There are certainly music and film purists who see streaming as the worst way to enjoy an album or a movie, but for the average user it's completely fine, if not totally preferable. With games, any sort of connection/input lag is immediately noticeable and a lot of games become difficult to play and enjoy because of it.

It really depends on how well this stuff works, but it's difficult to envision myself ever engaging in this kind of service the way I use Spotify and Netflix/Hulu/HBO/Amazon Prime/oh god there's too many. Part of that is very much a commitment to owning games (worth mentioning that I still purchase vinyl records and blu-rays for my favorite music/movies). But I'm also with Jeff when he says that there's something off about this that's just impossible to articulate.

I think a lot of the decisions made this generation around online/live games have been terrible for players. The preponderance of loot boxes, microtransactions, and battle passes may be necessary to continue funding support for games but I can't help shake the feeling that everyone's being manipulated in the name of continued player engagement and spending. Because of this I feel inclined to view a completely online gaming platform run by a major corporation with an inherent suspicion. And I haven't even gotten to the truly apocalyptic what-ifs about how this could influence how games are made.

The problem is this is all speculation, and I wouldn't be surprised if my views on it change within the next year. But as it is right now I think this thing is crazy in about ten different ways.

My feelings on this are profoundly negative. Games being able to use extra horsepower isnt worth giving up almost everything else.

I have to wonder what EA is thinking about all of this. They are the 800 lbs gorilla of the AAA gaming industry after all. Do they team up with Google, Amazon, or do they go it alone and start their own streaming service?

I'm not sure how they'd go it alone anytime soon. It's likely beyond their capability unless they license the tech from one of the big players. And then they'd also just be paying for compute cycles in Amazon, Google, or Microsoft data centers anyway. Probably not worth it.

@tds418: Thats true. Microsoft have got a foot in both camps having learnt from the mistake of trying to do something different last time.

I'm stuggling hard in seeing streaming as a dominant force in gaming anytime soon. Stadia may be able to reach 2 billion gamers but how many will pay $60 for the next AAA blockbuster and we still don't see the latest Disney movies on streaming, I doubt will see AAA games on a sub unless its their own EA: Access which is $14.99 just for EA's stuff.

People most likely to buy into streaming atm is the core which are very tribal and very small in comparision Steam, Playstation, Xbox and Switch ~500 million content is king and Stadia has very little.

The most played games around atm are mp online focused GAAS totally unsuited for streaming, why stream Fortnite with the added latency when its free anyway.

Gaming is never going to have its Netflix one size fits all equivalent we'll have too many providers all with their own competing service.

regarding the impact of stadia itself- i thought this editorial makes a salient point- it's quite likely stadia is google's business response to amazon and twitch (and less likely a sudden 'passion project' for them). google will always need a vehicle to direct user-attention towards ads- it's their reason for EVERYTHING.

@thepanzini: But there's not just Netflix for movies either; there's also Hulu, Amazon Prime, Sling TV, Youtube TV, and about a dozen other smaller ones. They all have their own content bundles and they all have their own unique quirks (e.g. Hulu can be bundled with Live TV, Amazon Prime also gets you free package shipping, etc.); though at their core they are all streaming providers. There was only a short period of time where Netflix was the only game in town. In addition to that, before Netflix game along there were tons of different providers using older delivery methods that all seemed unstoppable. In 1997, no one thought Blockbuster would ever go away.

To me, it's pretty easy to imagine games going the same way. Stadia may be Netflix, but other companies will offer other options that vary in some ways but all use streaming at their core. And there will be at least one company still doing the old fashioned delivery method, like Red Box does with movies now, but their marketshare will be tiny and not worth talking about once the switchover happens among the general population of gamers.

The key of course is for the tech to work the way that conference described and for the price to be reasonable. If it doesn't, this'll never be more than a niche product, but if it does, I think things will change pretty quickly. Not immediately, but over time, as people need to upgrade their PCs again, or buy their next consoles, and see how much cheaper Stadia is, a lot will start moving over.

I really hope there is a push for some form of video game preservation being put in place. Official archival, museums, stuff like that.

I'm just terrified of the idea that if a game is exclusively on a streaming service like Stadia and then gets taken off that service, it's gone forever.

Even if we can't necessarily archive and preserve the game in our home, at least archive and preserve the game in a museum. I don't want games that are taken off sale to just disappear entirely forever. I want it to be possible to see and play the game somewhere, somehow.

It depends on how long Phil Harrison is there for.

When Phil's name pops up, Atari, Sony (early PS3 era) and XB1 launch era things seem to go to shit.

I'm being unfair, I know. Just a trend I've noticed over the years.

I hate the idea of all video games trending towards streaming. But these things you've pointed out have me really excited for the idea of a huge open world game like Skyrim where the developers would no longer need to worry about streaming assets, or how much time they are spending simulating physics or rendering or game logic, or how the textures get compressed and decompressed, and can simply build a giant world and literally let everything run all the time, absolutely no optimization needed, since you have virtually limitless processing power to work with. That way they focus on just building the game and fixing bugs instead of profiling code and limiting features due to lack of processing power.

As horrible Stadia is and where things look to be going in the next few years, I doubt traditional gaming will completely disappear. I don't care how smart their predictive tech is for inputs, it's not going to be a mainstay in serious competitive gaming. It's something that will appeal to the more casual crowds, just like smartphone gaming. A lot of core gamers will probably take advantage of the service on the go, but at home they'll probably still play locally rendered games.

Unfortunately, convenience does drive industry. That's why Steam and all those digital stores caught on as well as they did, despite the terrible restrictions they place on their consumers. Despite that, though, DRM-Free games are still around as well as services that don't require you to use a proprietary client.

Even if Stadia or some other game streaming service becomes mainstream, traditional gaming is here to stay. It's just that it may become more niche. Nintendo, Sony, and MS will probably dip their toes in the water and, depending on the consumers reactions, will go from there. The companies that can afford to run such a service I imagine are excited for this. It will give them even more control over their products.

Polygon has a good opinion piece (IMHO :) ), that lays out the drawbacks of streaming.

https://www.polygon.com/2019/3/21/18274298/google-stadia-latency-always-online-specs-modding

The real killer to me is the legacy/history/nostalgia side of things. Google has already proven how much they care about legacy, by killing off Google+ this month. Orgs like the Video Game History Foundation are going to be in a really difficult position on this, unless developers become enlightened and concerned about not only their current marketplace position, but also about their potential historical impact. How bloody likely is that? We can't even go "Hey, that was a cool game, let me see if I can find it in this box of junk."

Streaming is extremely convenient if you have access to the infrastructure, but it really is surrendering all control for the sake of that convenience. And once you've surrendered control, good luck trying to get it back.

The preservation angle is always brought up.

I have an old boxed copy of Elemental by Stardock because I was stupid. That game was a dumpster fire on release and arguably got worse for about a year before it was finally fixed (and was just a smoldering tire fire at that point). So what if an archiving project has the disc? Is that even the game people think of when they think of Elemental?

And what about Tribes 2. That game was notorious for devs who listened to the community, broke everything, and then largely rolled it back to a bit after launch to fix it. Which version of that needs to be preserved?

And now let's get to the real meat and potatoes. World of Warcraft. Let's ignore all technical issues and just say that we can have a snapshot of that game from every single patch ever released and I can boot it up and play any of those instances at my leisure. We are done, right? Nope. Because is it really WoW if I am not surrounded by hundreds of dancing people screaming about trading shit?

And that is the real issue. I would love to have every ounce of gaming preserved because I think there is a lot to learn about society from it. I don't even care if I can personally play it. I just want historians who are trying to figure out where we went wrong to experience the Painkiller remake. But that just isn't feasible. Because gaming, at least from the late 00s on, isn't books or movies.

It is theatre. I can look up the script to any of Shakespeare's plays. I might even be able to find the renaissance (?) equivalent of a newspaper article talking about the opening night of Romeo and Juliet. But I can't look up how people reacted when the dude playing Juliet tripped or accidentally dropped a period equivalent of an f-bomb because someone farted. I can't read about Mercurio's actor in a bootleg production being completely wasted and ad libbing every line. And, in that case, did we truly preserve history?

So yeah. I do have serious concerns over what this means for preservation. We'll be able to save youtubes and the like of it. But we can't truly preserve the games. But... have we been able to do that for the past decade?

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I also just realized that historians a hundred years from now are going to be questioning how a screaming racist became the most popular person on the planet for a few years. Or why there is some chubby guy screaming about cranking it while playing a clearly bad game for four hours straight with some dude in purple overalls. Historians are fucked...

If Stadia really does catch on get prepared for games with tight controls and games with a lot of particle effects to go by the wayside. As much as Google and more optimistic bystanders want to believe that latency won't be an issue, even at the hands-on event input lag was noticeable and felt bad with Doom Eternal.

Speaking for my own experience with "streaming" games, using the PS4 Remote Play and Steam Link, there seems to be inherent limitations. My house is wired with Cat5 cables with a max speed of 100Mbs with my computer on the second floor, my TV on the first, and my router in the basement with a total round trip of around 60 feet (roughly). When I played Dark Souls 3 using my steam link on my TV, the time it takes from me pressing a button, the signal going through my steam link, to my router, to my PC, back to my router, back to my Steam Link, and finally displaying the result on screen is significantly noticeable and I've died to numerous dropped or delayed inputs. And forget rhythm games like Thumper because it becomes completely unplayable with just the few milliseconds of lag. Even going the opposite way with PS4 Remote Play (my PS4 is on my first floor) input lag is noticeable.

The image quality also noticeably drops. Artifacting and compression becomes highly noticeable with sometimes half the screen disappearing in video artifacts for a few seconds on the Steam Link (on PS4 Remote Play the image quality was more consistent and higher).

So if you're expecting me to get better results over my 50-70Mbs internet speed connecting to a data center however many miles away just because their controller wirelessly connects to my router I got a world of doubt. Even under the best case scenarios, I fully expect certain games and genres to be utterly unplayable. Explain to me how this will be a positive force for change in the gaming industry when it will actively kill aspects of it.

An interesting theory to use here is Clayton Christensen's "disruptive innovation" theory. He studied how once-dominant companies lost their dominant positions to new entrants. He found a pattern that appears to be happening in video gaming and is relevant to what some are saying in this thread about Stadia, specifically that there will be a core of hardcore gamers willing to pay premium prices for home-rendered games that do not suffer the problems likely with streaming.

The theory says that market leaders will tend to let new entrants siphon off low-end customers who care most about price because they can make more money by focusing up-market on premium customers who care about quality.

What happens over time is that the new entrants serve just good enough products to customers who care about low prices. The incumbents let entrants take those customers and focus on higher-end customers who pay more for quality.

With Stadia, Google is the entrant with the just good enough product in streamed games. Xbox is the incumbent focusing on higher-end customers with the quality argument and high prices around Xbox One X.

But over time Google can use the money it gets from the low-end customers to improve its product quality. As the product quality improves, Google keeps siphoning off more and more customers, and, and this is the key part of Christensen's theory, Xbox will let it happen! Xbox will let it happen because it believes there will always be a higher-end customer who cares more about quality than the price. Eventually, though, that proves inadequate to support the company any more. The incumbent dies, the entrant becomes the new powerhouse after "disrupting" the industry.

This has already happened to some degree with phone games. The console makers have basically let other companies take millions of gaming customers who care more about the cheap price of mobile gaming than they do about whether those games are "good" graphically. The console makers could have tried to compete for those customers, but the margins on those customers look small compared to existing console customers, so the majors decide to let them go.

And it might happen with Stadia, too, where the majors think they can ignore streaming games because the quality is lower than what consoles provide.

It's encouraging for Xbox's future to see Microsoft perhaps trying to push into the streaming market. But they seem to be doing it motivated by being the "Netflix of gaming", which is a totally different proposition to customers than what Google is putting out there. Google is not going after the Netflix of gaming idea, they are going after being a totally new development platform.

So it remains to be seen if Microsoft will focus on the Netflix of gaming idea, which is more about the storefront, or if it will pivot to address the development platform idea, which is its and Sony's core businesses in gaming.

@mellotronrules: That's a good read.

This quote confused me from google's presentation: “Gaming has always been the backbone of YouTube since the platform was first founded,” notes YouTube’s gaming director Ryan Wyatt.

Is that true? It makes sense they would claim that to the GDC crowd, but was gaming really that important in the early days of YouTube? How many people even had the ability to capture gaming footage to put on youtube?

This also makes me wonder what youtube looked like way back in its early days. I don't really remember.

This is a great point.

Easy to get caught up thinking how Stadia will fare with what games look like now. But the biggest impact of Stadia on the gaming industry might be to entirely change what types of games get made.

Easy to imagine shift to Stadia dramatically reducing first person shooters, for example.

But this is one of the most exciting things about Stadia, too, how it opens up entirely new game types. We've been stuck with FPS dominance for so long, and maybe that's because those games are so perfectly supported by the infrastructure and limitations of the home console. Breaking free of those limitations might open up entire new genres and creative directions for gaming.

@gundato: As a person who never threw away any of my big box pc games, whose favourite etailer is GOG, and whose favourite content on GB is Old Games Show, game preservation is super important to me. Needless to say, I'm not a fan of this all-streaming future.

Man, imagine google shutting down both Stadia and Youtube. Never mind the games, what if every video evidence of a Stadia-exclusive game ever existing, is also forever lost to history?

@eighte8: Playstation reason for being involved skipping kids and teens and going after young adults, when the Wii was massive hit with non-gamers Sony made the least effort to attracted them. Playstation/Xbox has only ever really been focused towards the core with their media functionality and cheaper prices later into the generation used to cater to the more casual audience.

The people Stadia appeals to isn't that big atm in console or PC gaming and with the Wii we saw how fickle that group was, Google has a massive task ahead of itself having to build an entire eco-system and convince delevelops to port their content for a small number of generally low spenders. Google will need to foster a platform that'll have high running cost and a long loss leading phase which Google has not done so in the past and been quick to give up.

So what's the difference between this and Onlive or PsNow? Google's name? Has there been some kind of new tech in streaming to make this run better on regular connections?

IDK, it kind of sucks. I live in the Arctic where internet is drip-fed through an IV, streaming would simply not be an option. Not that they'd mind losing all 0.05% of potential customers though...

I agree. It will be very interesting. For the past 20 years affordable laptops have been digging the desktops grave. Then smartphones and tablets took another bite. Now streaming will take a huge bite from the ONE part of desktop PC that still mattered---PC gaming. Just a tiny downturn in sales will likely have a domino effect because the ecosystem depend on low end hardware just as much as high end hardware. People always want slimmer sleeker systems so OEMS have already been abandoning the ATX spec to cram things down, when OEMs stop ordering ATX spec parts the hobbyist will not be enough to keep that afloat without raising prices. A tipping point will be hit very fast where and OEM can put system together that is more powerful that you can make yourself simply because they cost to make FAT motherboards with teh I/O shield and screw holes in teh proper spot just for hobbyist won't be worth it without jacking the price.

We will all see how just small shift can kill an ecosystems - our ATX ecosystems will be like coral in an acid-rain sea. Custom PCs will not assumable like legos so a dope with a screwdriver could do it; a hobbyist will need to up their game...heat guns, soldering stations, 3D printed custom cases, and using scarifier boards to harvest parts. If I were a YouTube hobbyist builder like JayzTwoCents, Bitwit, or Paul's Hardware; I would start shifting to reviews or become like Strange Parts. That guys channel is about BUILDING and MODIFYING smartphones or small devices - a level up for sure. Could be that custom computers are about to move beyond the screwdriver skill level? If all you needed was a credit card, a kitchen table, and screw driver was building a PC even and accomplishment anymore? Maybe, that guy on The Verge building a PC that worked despite him being a dope should have told us something!

I think the other point to be understood is that BOTH Nvidia and AMD have talked about server GPUs in recent weeks. AdoreTV talks about this in more detail than I could.

I think the key to understand that both AMD and Nvidia are seeing teh same world, one where sever streaming games is a big fraction of how games are played. I said ist above and I'll say it again, this is the long term trend this is not going away even if Stadia fails. Second, this does not have to please high end gamers to EFFECT high end gamers. Fewer people spending their dollars on low end and mid-level systems will jack pricing for CPUs, GPUs and peripherals for the high end gamers. So PC will still be faster with less latency, but people going that way will be PAYING more for that.

And, yeah, I think what AdoreTV sees as the good, the bad, and the ugly is all true. So, his video is worth a watch...

My point is: It is easy to preserve amiga games. I mostly give GoG money because they are ripping my old dos games in a better format than I ever would.

But what about a live game? Do we have a preserved copy of Counter Strike Go that corresponds to when Ninjas in Pajamas (?) rocked that exploit during Dreamhack and demoralized their opponent (or vice versa) and there was a shitshow of a ruling to figure out if it was cheating? Do we have a copy of World of Warcraft when the plague swept through Azeroth? Do we have a copy of Takedown Red Sabre from that summer event when all those Influencers played it and it was allegedly pretty good?

I am right there with you on wanting to preserve games. But I think we've already reached the point where it isn't viable.