Market Insight

Cloud Gaming: Google Reveals Project Stream Test

October 02, 2018

Piers Harding-Rolls Piers Harding-Rolls Director – Research and Analysis Director, Games, IHS Markit

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Project Stream publicly revealed by Google

Google has revealed its cloud gaming initiative Project Stream which runs high-end PC games from GPU instances in the cloud through its Chrome browser. It has launched a field test of the technology to a limited number of participants based in the US using Ubisoft's latest installment in the Assassin's Creed franchise - Assassin's Creed: Odyssey - as the test game. 

Background of cloud gaming 

GPU games rendering in the cloud and video streaming of content has been around since the early 2000s. The technology has improved since then, but the technical challenges still remain – requirement for high-speed broadband, the need to be close to data centers, latency, cost of streaming and infrastructure to the operator, and availability of content. There are multiple deployments around the world that have been operating for some time but remain niche in adoption. There has been a renewed interest in streaming during the last couple of years due to the growth of bundled content subscription services on console and the potential positive impact of new network technologies such as 5G. 

Google’s Project Stream is currently only a test of the technology, so it’s hard to compare with other commercial services which are already on the market. Sony operates PlayStation Now across PS4 and PC, while Microsoft is working on its own streaming technology in partnership with AMD and leveraging its cloud capability. PlayStation Now is positioned slightly differently as it offers support for previous console games – PS2 remakes and PS3 – as well as PS4 titles. As a PC user, getting access to a catalogue of PlayStation content is a unique proposition. 

High-end gaming via the browser has been tested before, but has had minimal success. The fact that Google owns one of the most popular browsers is a significant advantage. It is likely the streaming app will act as an extension for Chrome.

Why Google is interested in cloud gaming   

IHS Markit data shows world spending on games content and services is expected to reach $129 billion in 2018, which is bigger than many other entertainment markets. While commercially attractive, games are a significant engagement tool for different forms of consumer services and are very sticky. One area of the market that has yet to have been majorly disrupted and is still dominated by three incumbents is the TV console market. Google believes it can disrupt this part of the market and force a way into the value chain. There are also lots of other Google products and initiatives that align with cloud gaming – Google Cloud, Daydream VR, ARCore, Android, Android TV, Chrome, Chromecast – the list is really quite long so it looks like a good strategic fit.   

How quick it comes to market and how extensive Project Stream becomes really depends on the performance of the trial. We believe it will be some time before we get a full offer. However, Google is serious about high-end games – it hired ex-Sony executive Phil Harrison to build its ability to access this part of the market, so we can expect more developments in the coming months.

Please note: We will be publishing a new report - 'Next-Generation' Cloud Gaming - in the coming weeks, where we will examine the implications of new market entrants and new networking technology on the dynamic of the industry. 


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