What Sony’s Gaikai Acquisition Means for You

If you missed the news, Sony bought out cloud-based gaming company Gaikai yesterday for a cool $380 million (and dropped OnLive Blu-ray support today). That’s a solid chunk below the $500 million some folks were throwing around last week, but still not bad for a company that seems in primary competition with OnLive for a market that seems mostly nonexistent. SCE president and group CEO Andrew House neglected to go any deeper in the press release than combining Gaikai and Sony’s various gaming platforms to create what he hopes will be “unparalleled cloud entertainment experiences” with “content ranging from immersive core games with rich graphics to casual content anytime, anywhere.”

For current implications, it seems largely to be somewhere in the neighborhood of streaming either demos to the PS3 and Vita (as demos are the current focus of Gaikai anyways, leaving full games to other services like OnLive) or streaming PS3 content to the Vita. In fact, streaming to Xperia Play phones isn’t entirely outside the realm of possibilities, either. All that time you spend managing game and save data on your various SD cards in your various mobile Sony devices could be a thing of the past.

It seems, though, that cloud-based gaming is both the best and worst option for your mobile gaming lifestyle. One on hand, you won’t have to spend time downloading, installing, and deleting games anymore; just click play and go. However, mobile devices will live either on Wi-Fi, which could be spotty, or on a mobile 3G network. Both options will exacerbate the most prominent problems with cloud gaming: lag. It’s not a problem sending a single frame to a device; the challenge lies in doing so with little to no latency.

An obvious optimization is compression of each frame before sending it off into the ether to serpentine its way onto your screen, but that kind of defeats the purpose of having servers capable of cranking out the highest fidelity graphics possible, only to be shown to you more full of artifacts than an Indiana Jones film. This falls in line with a coincidental benefit and detriment to mobile devices, as they inherently have smaller screens and thus don’t require such high resolution feeds to maintain acceptable levels of visual veracity. Of course, this also has the innate problems with smaller screens in that, well, you have a smaller screen.

But these are just conjectures for current hardware. It’s much more interesting to think about (gasp!) the future. Let’s say the PS4 has at least some semblance of a cloud gaming service connection (it’s unlikely Sony’s next console will be wholly online given Kaz Hirai’s statements in 2010 and the complete and utter failure of the PSP Go, though rumors might lead you to believe otherwise). This totally trivializes backwards compatibility to making sure one machine can run old games as opposed to every single PS4 out in the wild. This also seems like the only way we’ll be guaranteed backwards compatibility what with the success of HD collections and the demise of backwards-compatible PS3s.

This also has more unsettling implications, however, as cloud gaming obviously requires a constant connection to the cloud, and as you’ve seen from the recent debacle of the Diablo III launch and incessant backlash to any always-on DRM requirements for PC games, people aren’t too happy about having their single-player experiences dependent on a bunch of other people or hardware not in their control. It’s a nebulous reaction to the feeling of loss of ownership and plays directly into the human tendency for loss aversion.

A cloud-based console could also spell the end for console cycles in general. Why do you need to refresh your consumer hardware lineup when all that is really required is a server upgrade? Of course the streaming box or whatever you want to call it could need upgrades to wireless or Ethernet protocols and hardware improvements, but for the most part, any firmware, software, or any other type of update will only be necessary in a data center in Oregon, far away from the client-side of things. In fact, you may eventually just need a TV and a controller if Samsung has anything to do with it.

This has some significant technical implications as well, such as how do you get PS3 and prior-specific content to run on a bunch of Intel CPUs and Nvidia GPUs? If you just hook up a bunch of PS3s or PS4s and start streaming, you don’t take advantage of the latency compensation technology that Gaikai and OnLive have developed over the years and instead end up with 60FPS Call of Duty matches with 2000ms input latency. But who knows, maybe this will force improvements on global Internet infrastructure. Maybe we’ll all finally catch up with South Korea’s ludicrous speeds.

And like it or not, it seems that cloud-based gaming will be in some way part of our futures. It may not be immediate and it may not be a grand flip of the switch where one day we’re all playing Watch Dogs on our phones, but it’s coming. This Gaikai acquisition and the leaked Xbox 720 (perhaps soon to be Xbox 8?) documents mentioning an OnLive acquisition (of $1.8 billion?) all points to one thing: the cloud.

And that companies have a really hard time keeping secrets.

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