PlayStation and cloud gaming: Sony invests in technology, report from Bloomberg

PlayStation and cloud gaming: Sony invests in technology, report from Bloomberg

PlayStation and cloud gaming

While Microsoft is speculating an imminent arrival of the definitive version of the xCloud streaming services for Xbox Game Pass on PC, it seems that Sony's investments in the sector are growing.

This is what Bloomberg reports. of a recent new round of investments linked to Ubitus, a company specializing in technologies related to gaming via the cloud. Born in Taiwan, but now based in Tokyo, the company has been active in the sector since 2007 and boasts collaborations with many major players in the industry, from Square Enix to Nintendo, for which it oversaw the cloud rendering of Capcom titles and Ubisoft.

Well, recently, Ubitus has inaugurated a new collection of resources, for a round of investments that - according to Bloomberg sources - would have seen contributions for about 400 million dollars. Of this amount, about 42 million dollars would come from three big names in the gaming industry: Square Enix, Tencent and, of course, Sony. However, the amount of individual investments by the three companies does not seem to be known at the moment.



PlayStation's commitment to cloud-gaming technologies is mainly reflected in the service offered by PlayStation Now, but a growth path of interest has its origins as early as May 2019, with the announcement of a Sony and Microsoft alliance for the development of the cloud.






Cloud Gaming's Missing Piece Is 5G

Graphic: Elena Scotti (Photos: Shutterstock)

When my brother and I were kids, our family took a lot of road trips. We loved the end destinations, but getting there was a major drag. We had Game Boy Colors and other handhelds, but we had already played the games we owned way too many times. Consoles and desktop PCs aren’t exactly portable, so we often got bored and played dumb games like Punch Buggy, pissing our parents off in the process. If we could have used a laptop or smartphone to connect to a cellular network and stream games from the cloud, car rides would’ve been a lot more pleasant.

I say that with the benefit of hindsight: Little me couldn’t have anticipated that cloud gaming would become a thing. But it is, and it has the potential to make gaming far more accessible—not just for petulant kids on road trips, but for those who can’t afford gaming rigs.

Cloud gaming has plenty of benefits: You can save on shelf or desk space without a giant desktop, you don’t have to worry about your console SSD running out of storage space, and you definitely don’t have to spend hundreds or thousands of dollars on a gaming console or PC. If you subscribe to a service like Google’s Stadia Pro for $10 a month, it would take around 10 years before you spent the equivalent of what it would cost to buy a mid-range PC. If you subscribed to Nvidia’s cloud gaming service GeForce Now for $5 a month, it would take twice as long, not including the cost of games. But to game over the cloud, you need access to good, fast internet, and 5G is poised to provide that to more people—whether that’s at home or on the road.

The popularity of cloud gaming skyrocketed last year, due in part to pandemic-induced global stay-at-home orders. More people are playing video games in general because they are stuck inside with extra free time, or because it’s a way to stay connected to friends. But cloud gaming specifically saw a huge spike, driven in part by big-name titles like Cyberpunk 2077.


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“If you wanted to play with your friends on a more advanced game, [but] you didn’t have a gaming PC that could run it, then cloud gaming became a way for you to play with your friends,” said Candice Mudrick, head of market analysis for games and esports data company Newzoo, during a recent GameBench panel on cloud gaming.

According to Mudrick, Microsoft xCloud, PlayStation Now, and Nvidia GeForce Now saw the largest increase of subscribers in 2020. As of January, Microsoft’s Xbox Game Pass subscribers totaled 18 million, an increase of 3 million from September 2020. GeForce Now had 6 million registered users the same month, an increase of 1 million from November 2020. PlayStation Now had 2.2 million subscribers as of May 2020. Newzoo predicts that the cloud gaming market will be worth $4.8 billion by 2023.

And this is all before 5G networks, which enable faster speeds and lower latency, have fully blanketed the world.

The big wireless carriers and wireless broadband companies use cloud gaming as a prime example of the potential of 5G. With a 5G-compatible device, gamers can untether from the wired broadband connections in their home and downsize from bulky, expensive PCs and consoles (if they want). For gamers who also happen to be minimalists, or parents who don’t want to invest in an expensive piece of equipment for their kid, that seems alluring.

The fastest version of 5G, based on ultra-high millimeter-wave spectrum, is capable of speeds as fast as gigabit fiber internet—or faster. 4G LTE tops out at around 50Mbps, according to Verizon, which is fine for playing most games over the cloud on your phone, but nowhere near enough speed for a home network with multiple users. It’s important to note that cellular 5G can be implemented on the same 5.0Ghz frequency as your wifi router, but they are two separate technologies. The mmWave piece of 5G can’t penetrate, say, buildings or windows, which is why AT&T and T-Mobile have prioritized mid-band 5G coverage. Mid-band is faster than LTE but slower than mmWave, but you need both speed and signal strength for wireless cloud gaming.

Cloud gaming doesn’t require 5G home broadband—and only one carrier (Verizon) even offers it as an option—but the first 5G-enabled laptops are already here. And you don’t need a $2,000 PC to play demanding games anymore; cloud gaming works on any type of device, including Chromebooks and MacBooks. It’s possible that 5G will become a viable home internet alternative, but for now, mobile cloud gaming is an early test of how impressive 5G actually is.

Look, it’s not magical. It has the same limitations as every other wired and wireless service, including network bandwidth, latency, service range, and, of course, cost—the latter being the most prohibitive for rolling out the technology to rural areas. Cloud gaming platforms like Nvidia’s GeForce Now, Google Stadia, and Shadow have proved the technology works—and works quite well—but at a certain point, cloud gaming adoption will plateau if the infrastructure isn’t built out to accommodate demand.

“The advent of cloud gaming is probably inevitable,” said AT&T’s Matthew Wallace, who oversees the carrier’s 5G product and marketing. “Streaming video is an excellent example. Not until the advent of the higher speed LTE networks did that become something realistic that you could use and enjoy on mobile networks.”

Essentially, 5G is to cloud gaming as 4G LTE is to streaming video. 5G promises to untether people from the wired broadband in their homes and enable them to play demanding games on any mobile device anywhere. But what prevents that from happening, Wallace said, is connectivity limits.

5G needs to remain unlimited if people are going to use that network for their home and mobile internet service. With data caps like the ones Comcast, AT&T, and other major internet service providers impose on their wired broadband customers, 5G’s potential will be stifled—unless those customers pay an extra $30 (at minimum) to upgrade to unlimited data. On the wireless mobile 5G end of the spectrum, T-Mobile only this week introduced the first truly unlimited—no data caps, no throttling—5G plan. It’s unclear if the other carriers will match that plan to stay competitive.

“People need to not worry about hitting data caps and and running out of their their data on services,” Wallace said.

“Cloud gaming is a different beast, but I think we have the right technology in place now to really be able to address it.”

5G is not yet widespread, especially outside of large metropolitan areas, and ISPs are still grappling with the rise of cloud gaming on wired broadband networks. Gino Dion, Nokia’s director of innovation solutions, said he gets a lot of questions from local ISPs about how to improve their networks to handle cloud gaming.

“If I spend two hours playing Apex Legends, I may send maybe 500 Mbps of traffic over the 2-hour period. But if you do cloud gaming, that’ll be 500 Gbps,” Dion said.

This metric inspires wide-eyed reactions from the ISPs he works with: “Oh my god, how do I handle that?”

From a network capacity perspective, it can be scary—ISPs need to upgrade their networks to handle the massive amount of data cloud gaming requires. Streaming a Netflix video in 1080p might only take around 3 GB per hour, whereas cloud gaming could use three times that much at the same resolution.

“Cloud gaming is a different beast, but I think we have the right technology in place now to really be able to address it,” Dion said. “We have the capacity, we have the technology, and we have the content...from Nvidia and others.”

Patrick Beaulieu, who manages strategic partnerships for Nvidia’s cloud gaming service GeForce Now, said 5G has already been a massive improvement for cloud gaming in terms of reducing the amount of lag or jitter a gamer might experience.

“Cloud gaming is very dependent on the quality of the transmission for the data back and forth...5G allows us to do less work to repair the transmission, to provide a smoother experience, which is critical when you do cloud gaming,” he said.

Much of the cloud gaming adoption Nvidia’s GeForce Now has seen in the past year is from users who lack the PC hardware to run modern games without issues, Beaulieu said. It can cost thousands of dollars to build a PC capable of running the most demanding games with the graphics settings on ultra. GeForce Now is a very PC-centric service, and GeForce Now users seem more interested in playing games on their PCs rather than phones. Much of that has to do with the fact that most the games on GeForce Now were designed for PCs or consoles, not phones.

But Beaulieu said Nvidia has been working with various carriers since before they officially rolled out their 5G networks to make sure 5G would be a significant improvement for GeForce Now. Mobile is still a small fraction of Nvidia’s cloud gaming base compared to desktops and laptops, because 4G has been a challenge for cloud gaming platforms. But Beaulieu said 5G solves many of the quality and latency issues reported by GeForce Now users over a 4G connection. In countries like South Korea where there is a more robust 5G infrastructure than in the U.S., cloud gaming mobile adoption has been greater overall.

And that brings us to the biggest issue with cloud gaming over 5G: The networks in the U.S. just aren’t widespread or capable enough to meet the demand, even on mobile devices.

“It’s not just enough to say that 5G is going to solve the problems of cloud gaming on mobile devices,” AT&T’s Wallace said. “5G is a shared resource. Bandwidth can get congested with lots of lots of users on there.”

5G also needs a lot of underground cables connected to cell towers to expand the wireless network and reach the super fast speeds it’s capable of. According to a recent Forbes report, fiberoptic cable is the best answer to that. But laying fiber costs money. A lot. ISPs have been reluctant to replace much of their aging cable and DSL networks.

“It’s not just enough to say that 5G is going to solve the problems of cloud gaming on mobile devices. 5G is a shared resource. Bandwidth can get congested with lots of lots of users on there.”

Wallace said it’s possible we could see partnerships between carriers like AT&T and cloud gaming providers to enable edge computing to make 5G investments more lucrative. From a consumer perspective, that could mean something like adding a cloud gaming package to a data plan to make up for the extra data hogged compared to, say, streaming videos. But 5G is still in its early stages, so it’s tough to tell what those plans would look like. However, if Cox can charge for an “elite gamer” internet plan that supposedly prioritizes gaming internet traffic for an extra fee to reduce lag, what’s to stop any wireless carrier from doing the same for cloud gaming traffic in the future?

Ignoring the gaming angle and just focusing on the capital expenditures, carriers like AT&T and Verizon just spent tens of billions of dollars to bid on spectrum in the FCC’s recent C-band auction, which means all of their resources will go into paying for and expanding their 5G networks, according to Moore Insights & Strategy analyst Anshel Sag. To make up for those costs, compromises will have to be made.

“I have a feeling that one of the ways that operators like AT&T will monetize cloud gaming will be to offer a cloud gaming slice to cloud gaming services,” Sag said.

Essentially, cloud service providers like Amazon, Google, and Microsoft, which already have cloud gaming platforms in place, could partner with carriers. A cloud gaming service like Stadia or Amazon’s Luna could pay a carrier like AT&T or Verizon to set aside some bandwidth specifically for its service so that it either reduces the cost to the cloud service provider or consumer. That in turn could allow the cloud companies to provide their own connectivity plans alongside their cloud gaming service. So instead of getting your internet from AT&T, you get it from Amazon. In turn, consumers could end up having to pay a separate fee just to game in the cloud. Stranger things have happened.

Running the data servers needed to support cloud gaming platforms requires a hefty investment. Nvidia hasn’t been affected by the availability of components like GPUs because it uses data center-grade parts rather than consumer-grade parts. But for a smaller cloud gaming provider like Shadow that uses consumer PC components in its virtual desktop PCs, the hardware shortage has slowed down its expansion a bit.

“We have so much demand that we can’t meet, so we already have a big waiting list, ” Shadow Vice President Florian Giraud told Gizmodo.

But while 2020 was a great year for demand, it was an equally tough year for supply.

“It’s much harder to to get access to the components,” said Giraud. “It’s much harder to go to our data centers and install new hardware.”

Cloud gaming will benefit from 5G, but some, like Giraud, believe it will transform everyone’s daily lives on a larger scale. How we work and live could change radically.

“Right now we’re not quite mobile with covid, but we will be again, and 5G opens enormous possibilities,” Giraud said. “For those who don’t have a basic internet connection, maybe 5G will be able to address this.”

There’s no question that 5G will be a massive help in driving cloud gaming adoption, as well as cloud computing as a whole, whether people want to tap into the network on the road or from their home office. But for cloud gaming to really take off, the vast, expensive infrastructure not only needs to be built, but it needs to be built in a way that also addresses the digital divide. Sag, the Moore Insights analyst, said though 5G home broadband could ease America’s internet troubles, the potential of the high-speed mmWave flavor of 5G is overblown.

“Right now we’re not quite mobile with covid, but we will be again, and 5G opens enormous possibilities. For those who don’t have a basic internet connection, maybe 5G will be able to address this.”

“I do think there is some validity to how [5G] could unburden the already not so great situation for home internet because it introduces yet another stream coming into the home,” Sag said. “However, I hate to say it, but Verizon constantly pushing cloud gaming with millimeter wave, that’s something that you can only get, in the future, a maximum of 10% coverage...millimeter wave is not designed to be a coverage technology.”

Will cloud gaming wipe out the need for a custom-built gaming rig or a powerful gaming laptop? For many gamers, probably not. But with the promises of 5G, cloud gaming could open up the world of games to a new audience and make it much more affordable in the process, and hell, maybe even increase home broadband competition. One can only hope.