This was enough for me to make my comment. Worldwide broadband access has a long way to go before cloud gaming becomes mainstream and I think Sony is aware this too.
Then why did Sony launch a cloud streaming service first? Haha. Cloud doesn't have to rely on broadband. It could be the proliferation of technologies like 5G that eventually bring cloud gaming to countries with less broadband coverage.
Having an huge & global infrastructure is crucial imo. Sony and Nintendo can't do/haven't done it. They need Amazon, Google or Microsoft. That's not being delusional. It's a fact.
His comments were not about cloud gaming being able to generate billions on revenue or replacing consoles at all like some in here seem to believe.
Exactly.
I've seen a lot of people lose it about these quotes, as though Spencer was trying to basically change the rules so he didn't need to "admit defeat" or something, which is just idiotic. Spencer has gone on record at length, about the myriad mistakes Xbox made this generation, and acknowledged that they are not the market leader for consoles right now. He spent hundreds of millions on new studios, specifically in response to a shortcoming they had versus Sony. He's releasing the Xbox SX, specifically to compete with the PS5. He's openly said that he still thinks the "cloud future" isn't here yet, and won't be for years.
These quotes are about the future of gaming, where platforms and formats dissolve away as the "real" battlefield. Microsoft, Amazon, and Google are going to overwhelmingly be the people who "own the wires" of the cloud gaming future, so to speak. Conversely, companies like Sony and Nintendo are going to become their customers, as they haven't made the same investment in building out datacentres and stuff for the future. You can already see this in that MOU Sony agreed to with Microsoft, about bringing Sony onto Azure in the future. Sony know they aren't positioned to be able to do these things themselves.
When local hardware eventually goes away, companies like Sony are essentially going to become game publishers. And in that version of the future, Google and Amazon become Microsoft's "real" competitors.
This is just a continuation of what Microsoft are already doing, with their de-emphasis on the console hardware as the centrepiece of the ecosystem, in favour of decentralizing and expanding what the "Xbox Ecosystem" is - it's PC, it's mobile, it's Xbox consoles, it's streaming, and it's even some games here and there on competing consoles. While they'd certainly like to win the "console war" by selling more hardware, it's ultimately not that material to their future plans.
I've seen a lot of responses online bringing up the seeming failure of Stadia to show how preposterous Spencer's comments are, but that also misses the point. Stadia could fold tomorrow, and Google would still be Microsoft's competitor for the "cloud gaming" future, because they have that massive, lucrative cloud infrastructure that the "winning" services are going to need to become clients of to deliver it. That's going to make Google more money than something like Stadia ever will.
Literally the only fault I can find in Spencer's wording, is that he makes it sound a bit like this shift in competition is already complete, when it's still several years away, and to some extent still speculative about the future of gaming. However, that could also easily be the fault of "protocol" not properly contextualizing his comments in the article.
People are overreacting to his comments, because they are only looking at cloud "competition" as essentially xCloud vs. Stadia vs. PS Now vs. whatever Amazon announces. That fundamentally fails to understand what he's actually talking about, which is way bigger than a few consumer-facing subscription services battling it out. Microsoft is hoping to eventually own the entire battlefield those services are standing on.
