Microsoft’s Right, Google Stadia Needs Games to Sell Well

Google’s Stadia reveal event last month showcased such impressive technology that it was hard not to get carried away. Streaming looks certain to be the future of the video gaming industry, though when it will actually be ready to supplant traditional hardware remains in question.

I’m not convinced it’s anything less than two or three years away, personally, which is a case I’ve presented in response to both Stadia and Microsoft’s Project xCloud and Scarlett.

But rather than talking again about the limiting factors of internet infrastructure, I’m going to reiterate another issue with Stadia: Google needs quality exclusive game content to make it an attractive platform. No matter how convenient and effective Stadia’s streaming technology is, it doesn’t escape this golden rule.

I’ve presented this argument before, but the reason I’m retreading the same ground here is that now Microsoft has just weighed in with a similar opinion. Speaking with to a UK newspaper, Chief Marketing Officer for Xbox Mike Nichols said:

“Emerging competitors like Google have a cloud infrastructure, a community with YouTube, but they don’t have the content.”

You might remember that Phil Spencer actually issued a statement to his staff following Stadia’s reveal, admitting that Google’s technology and infrastructure represented big competition for Microsoft. But Nichols is clearly confident that their studio acquisitions, key partnerships, and experience within the video game industry will give them an edge of Stadia.

Indeed, Nichols went on to suggest that Google’s inexperience in the games industry means they don’t present a serious threat, even if Stadia’s YouTube integration makes it a highly visible platform for potential users.

Another interesting takeaway from his interview is that Nichols actually goes so far as to share another opinion that many gamers have been voicing: that games running on local hardware will always offer superior performance to streaming platforms.

Google was keen to stress during Stadia’s reveal that there was parity between the performance of streaming technology and games consoles, that latency wouldn’t be an issue with connection speeds of around 20mbps. In fact, Microsoft, too, has in the past suggested something similar, talking up xCloud as offering a comparative experience on even slower connection speeds.

Nichols, though, is admitting here a truth that seemed obvious, but one that hasn’t really been agreed with by a major player invested in streaming tech before.

“You won’t necessarily need a device over time, but you’ll get the best experience with local processing power [available on a console or computer],” he said.

Basically, he’s talking up the value of Microsoft’s next hardware versus a streaming-only service like Stadia. Nichols is highlighting that a unit with local processing capabilities as well as streaming technology is going to offer a big advantage over Stadia, which will be of key interest to hardcore gamers.

Again, it’s something that I think most of us knew to be true already, but it’s interesting to now hear a Microsoft exec trumpeting the same rhetoric. Where before it was a campaign of convincing gamers that xCloud would deliver comparative performance, the narrative seems to now be changing to streaming as a supplementary performance boost.

Nichols went on to compare Microsoft’s own equivalent of Stadia to streaming Spotify on a low-quality speaker rather than a dedicated music system.

These are exactly the sorts of principles I’ve also previously argued make Microsoft’s xCloud far more appealing to Stadia, at least in the short term. Google can’t expect to displace traditional hardware unless it establishes quality first party studios and secures exclusive partnerships.

Gamers are too savvy with their understanding of latency and the issues with requiring a constant connection to play games, and quite honestly, many of them are highly resistant to a change in that setup.

Stadia will not only need to prove its stability and efficiency but also that it’s the most desirable place to play video games. Convenience and accessibility have defeated other mediums, but Google will need to really establish itself to convince the gaming community to ditch its hardware.

Games talk, and until I see this attractive lineup of content that Google teased during Stadia’s reveal, I remain convinced that it isn’t any sort of threat to any of the big three.