A few years ago I asked Reed Hastings, Netflix’s CEO, if the company would adopt game streaming. His answer was very clear: Netflix was in the movie business, not the gaming business. While Netflix has decisively stuck to a core focus, we’ve seen a huge surge in investment from big technology companies in game streaming.
Several major tech companies, from Google and Microsoft to Sony, Amazon and Verizon already either have or are working on game streaming services. Google Stadia is slated to launch in November.
Ultimately, it’s a numbers game.
There are 2 billion people who play video games on the planet today. Many of those people don’t own a television or a PC. For most, the phone is their compute device. Today, far more people are able to watch shows and movies thanks to smartphones and media digitization.
The companies that win the race to reach the masses will be those who can leverage technology effectively to reach and engage a customer wherever they are, on the devices that they have. The best way to do that is by lowering the barrier to entry — When you eliminate stuff like the need to own a TV and game console or the requirement of a stable internet connectivity, you open up a whole new market.
While we’ve made similar shifts before e.g from DVD — physical media — to streaming digital entertainment, streaming games is a lot harder than TV. Games can require serious processing power. Digitization alone only opens the door so much. Making high-end, processor-intensive games available through streaming services kicks open the door.
The door is cracking. For example, Netflix has introduced a level of interaction that’s completely different compared to a regular movie or TV show. With movies like Puss in Book: Trapped in an Epic Tale players make various decisions throughout the runtime to alter how the story progresses. While that sort of gameplay is far from something along the lines of Fortnite or God of War, it’s a fascinating approach that may open up a whole new market of “gaming” viewers.