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17 January 2019

Amazon, Verizon taking stabs at building Netflix of gaming

Amazon wants to disrupt the gaming industry with a new cloud streaming platform, irking not only the console makers, but also striking fear into the hearts of other video game streaming hopefuls like Verizon, revealing its own plans in the same week. The Amazon brand alone is enough to cause severe disturbance as we know, let alone factoring in its highly advanced streaming architecture.

Bandwidth constraints have hindered attempts to create the Netflix of gaming, yet with the combination of AWS (which hosts Netflix) and the rise of 1 Gbps broadband lines in the US over the coming years, the video game sector could soon have its knight in shining armor (for consumers, that is).

The retail titan is reportedly approaching games publishers for distribution deals, although the Amazon video game streaming service isn’t pegged to launch until 2020, according to The Information. So that gives the current streaming platforms like Nvidia’s GeForce Now and Google’s Project Stream some breathing room and a chance to grab some market share before Amazon barges its way in.

Rumor has it Amazon plots to take on the mobile space, rather than targeting PC gamers, which is interesting considering serious desktop gamers are more likely to part with their cash than casual mobile players. That said, hardcore gamers might scoff at the idea of an Amazon cloud gaming platform, although the success of its Twitch live streaming service provides Amazon with an existing gaming presence to build upon.

Verizon’s gaming strategy, meanwhile, is similar to Amazon’s but the operator has provided a bit more substance. Verizon will reportedly offer subscribers a Nvidia Shield Android TV set top on which to access its new cloud gaming platform, the creatively titled Verizon Gaming, according to The Verge. If true, it would mean Verizon and Amazon would not directly be in competition with the two offerings targeting very different audiences initially, although Verizon reportedly wants to expand its gaming tentacles to mobile eventually – not a huge surprise given its mobile footprint of over 150 million subscribers and major 5G push. It seems likely Verizon will end up rolling out a cloud gaming service as part of a 5G offering later this year, probably with a marketing campaign centered around 5G versus WiFi.

But Verizon has hardly been successful in the streaming space and its Oath unit, which sits at the intersection of media, entertainment, gaming, news, commerce and other services, recently entered a phasing out process, migrating services and technologies to the newly formed segment called Verizon Media Group. And while we know plenty about the technology Amazon will use to launch and support its streaming businesses, Verizon’s technological workings are less clear cut. It has a number of OTT video technology assets, such as the EdgeCast CDN it bought from Intel, which is used alongside a Velocix (née Alcatel-Lucent) CDN, with Ericsson video servers and VisualOn supplies a media player. We suspect Verizon will end up recruiting some additional vendor support, most likely a company with experience in gaming rather than pure video streaming, or it might even dip into the acquisition pool.

With its advertising and technology arm Oath falling off a cliff, Verizon might have to cough up for some serious technology to avoid yet another failure in digital entertainment, mostly famously the now defunct Go90.

Sony’s PlayStation Now is perhaps the closest the industry has right now to a cloud gaming platform leader, offering a slew of games to PS4 and PC users for a monthly fee, although subscriber numbers have never been released. With a number of rival launches now expected for late 2019, including Microsoft’s codenamed Project xCloud, we are already seeing early signs of setting up 2020 to be the year of the cloud gaming revolution.