I started four years ago to engage with telecom customers on positioning streamed gaming. The concept consisted in hosting the gaming hardware in the network center and streams the game graphics as a video stream to the gamer at home over the IP network on his TV. Hosting of games is therefore sometimes called 'Games in the Cloud'. At the network center we planned an Intel based server farm with powerful hardware graphics accelerators. At the consumer side we used a simple game controller connected to the TV-set, which had a small driver to capture the controller’s commands. We did successfully initial proof of concepts! Although we did a very good job, major concerns were expressed on the impact of network latency on the gaming experience and impact of the traffic volumes on the network.

After endless discussions on end-to-end network latency we ended up in discussing which kind of games can should be targeted. As on the one hand side the low-end / casual games could run on the setup-box, on the other side high-end games require graphical real-time rendering performance as brought by gaming consoles. This leaves the opportunity for streamed gaming to the middle spectrum of family games. The wish of telecom providers is to provide games with high interactions, e.g. car racing games, but network latency can cause the user a bad gaming experience. A unique point of gaming in the cloud is the ability to play multi player games over the network without dedicated infrastructure, for example playing a racing game against your friends in the same session. Beside technical concerns there were also business concerns, or on how to monetize a gaming service. Game developers are reluctant to give margin away; in particular as their income lowers as the games are not sold but rented.

Gaming in the Cloud was evaluated by telecom companies in many countries, several of them did proof of concepts and some of them started to define projects. The French market was definitely the most assertive, French telecom operators launched a gaming service quickly and it seems they even found a way to monetize the service. The fast market launch enabled them to leverage the market opportunity. They literally jumped through the window of opportunity to grab market share and started to create consumer service-loyalty. The initial gaming platforms have evolved, for example by supporting multiple consumer devices (setup box, personal computer, smart TV, ...). Nowadays I expect these gaming platforms will further evolve and telecom operators will adjust to maintain the customer base.

A key development over the past four years is that during this period the market changed: (a) casual / low end-games are nowadays provided by device manufacturers and downloaded by the consumer cheaply as an app on their device (being it Smart TV's, tablets, and mobiles as those devices are getting powerful with better screen resolutions and embedded hardware for game support (e.g. 3D accelerator)) and (b) community gaming and high end-games are provided over the top, directly by game console manufacturers such as Sony, Microsoft, and Nintendo through the new generation of IP enabled gaming consoles.

Conclusion, telecom operators risk to be squeezed by the direct relationship between game providers and gamers, thus risk of becoming a commodity provider in connectivity for gaming services.

As the decline of game console started to be seen and the industry landscape has change quite a bit, we can expect further changes. Games are now much less costly to be developed, sold at very cheap price. The trend is accelerated by the continuous growth in the number of applications available in application stores for IOS, Android, and Windows platforms. Game developers are trying to figure out how they can be profitable in this new industry eco-system shaping up. I expect that the streamed gaming approach will fade away over time, but for sure we will see new successful cloud based business models for games!

The game is not over, it will be a total different game!