Following its sold out
Cloud Gaming Summit in San Jose, CA September 7-8, FC Business Intelligence is bringing the cloud conversation to London January
17-18, 2012 with Cloud Gaming
Europe. Four of the leading
speakers from the upcoming summit offer their thoughts on the opportunities that cloud gaming introduces to game makers, telecommunications
and manufacturing industries and explain how this technology is literally changing the game business.
of cloud gaming companies like Gaikai and OnLive and the inclusion of the cloud in games for Apple and Android devices, as
well as PC and console games, is just the beginning of this shift away from packaged goods.
Nicholas Lovell is
a former investment banker and web entrepreneur who provides strategy and marketing advice to game developers like Firefly
and Rebellion and publishers like Atari and Square Enix. As Chief Games Officer at Bigpoint, Philip Reisberger works with
his brother Tobias overseeing the strategic expansion of the casual online game company’s game portfolio, overall game
design, and community management.
Olivier Comte holds the dual positions as senior vice president of European
video game distributor Namco Bandai Partners and general manager of Namco Bandai’s French subsidiary. And John Clark
is Sega’s UK Managing Director and Digital Distribution Director (PC), a role that not only drives the packaged goods
business in the UK market but, identifies and shapes the delivery of Sega’s market-leading PC content using evolving
digital channels, covering EMEA and the United States.
What role will the cloud play in the next generation of game consoles?
Olivier Comte: I would be surprised if the new consoles
don’t have more significant cloud functionality, if not for immediate use then at least in terms of future-proofing
them for developments to come. I have no evidence of this, but I can imagine cloud gaming services that work in parallel with
more traditional console operation. The extent of the cloud functionality will ultimately depend on how well it performs as
a game delivery medium.
Currently it remains a new, relatively unproven technology that relies very much on internet
infrastructure to function effectively, which as we all know varies significantly from country to country and place to place.
The console manufacturers will demand a high level of confidence in the technology and infrastructure before committing to
it in their home consoles.
Philip Reisberger: In the sense of a personal gaming ecosystem, the cloud
becomes the layer that connects everything together and guarantees that the player can access his game – or a specific
slice of that game – anywhere, anytime. The device becomes merely the window into the game.
to the developer to decide what experience or function each window serves. Practically speaking, the cloud is also where a
player’s account data is stored, managed, and most importantly – protected.
That’s a broad question. Whether streaming or downloading will win, whether we get super thin clients leaving the processing
in the cloud or much fatter clients that just talk to central databases: that is all up in the air. I’m pretty negative
about the role of consoles, and am much more hopeful the the browser/tablet combination will make the market much more viable,
vibrant, innovative and exciting.
When you look at gaming today, there’s a lot of focus on the casual games
space. I believe Facebook.com is reaching its peak and will start fading, but the social graph that it has created has been
incredibly successful. Moving forward, we’ll see Facebook and Twitter integrations in lots of places, including tablets,
Android, iPhones, and consoles. Games will use these social graphs to build connections. It won’t be about the URL,
but using the social graph is absoliteltely key.
I believe tablets are the future of entertainment consumption.
They provide such a better form factor than laptops or consoles for gaming and any type of entertainment.
John Clark :
Instant access is the key and the initial exposure to the game will make a big difference. PR and advertising will always
be the drivers in creating initial awareness for our content – driving traffic and interest off the back of this is
very important, when we have this, to be able to offer an immediate playable experience of “triple A” content
is a great prospect.
Emerging partnerships with network operators in Europe
(e.g. OnLive & BT, Playcast & SFR) are addressing the fear of bandwidth limitations and download caps. What do you
foresee happening with the penetration of cloud gaming in Europe verses what we’ve seen in the US?
Generally, broadband penetration is still lower in Europe, at 58% versus 78% in the US. While overall internet use is higher
in Europe, with 476 million people versus 272 million in the US, the European market is much more complex and fragmented,
with significant differences in infrastructure between countries and a very complicated job to do in terms of putting the
right partnerships and agreements in place. What we may see is penetration in some territories which is on a par with that
in the US, but I don’t believe it will be faster overall in Europe.
Philip Reisberger: Based on our experience and data, European
gamers generally have access to much higher-speed Internet connections, and many already play browser- and client-based MMOs.
Does this mean Europe will embrace cloud gaming faster? Potentially, but it’s really content driven. We’ve found
that really popular European-built titles don’t necessarily appeal to US gamers, but hit US games often enjoy broader
worldwide appeal. If cloud gaming really takes off, carriers will of course want to monetize it as a new or premium traffic
source. This could create hybrid subscription/F2P business models that ensure heavy-use players pay a fair amount for their
bandwidth, but not too much to discourage them from playing in the first place.
Nicholas Lovell : I’m
not an expert in the field of broadband penetration, but I’ve always been slightly concerned that the reason why OnLive
had to give up equity to BT was to secure distribution. I think broadband penetration is much more important for OnLive and
Gaikai, where they’re streaming AAA gaming content, rather than browser-based or persistent online worlds where the
interaction with the database can be cached locally temporarily. Or even with smartphone games, which are networks, but can
be played when you’re out of coverage.
What specific new opportunities does cloud gaming offer publishers and developers and how
is your company taking advantage of this?
Olivier Comte: As a publisher, the cloud offers a potential new way to deliver games which comes
with its own set of advantages and disadvantages, such as the lack of an end user client and hence the complete removal of
piracy issues, countered by its reliance on a complex and difficult to manage infrastructure for example. We always explore
and embrace appropriate new delivery channels and platforms for our games.
Philip Reisberger: Cloud gaming
is an interesting new way for publishers and developers to engage users more often and more in more creative ways. With the
cloud, it’s possible for players to enjoy their games throughout the day. The total experience, has to make sense, of
course, and should also reward the player with things like sign-on bonuses and free in-game items for extended play. At Bigpoint,
we’re constantly exploring new ways in which we can deliver games to players around the world. For us, we can build
a high-end game like Battlestar Galactica Online, but must take care to ensure it can be accessed by players in countries
that have lower-quality Internet connections. Internet access, of course, is improving everywhere all the time. While our
primary focus remains on building casual, core, and hardcore games that run within the web browser, we’re very aware
of the requirement to expand away from the PC.
Nicholas Lovell: Cloud gaming is a very broad term. It’s really two
different things. There are the streaming service like Onlive and Gaikai, which take PC or console-quality experiences and
stream them to customers. Then there’s another level of cloud gaming, which is anything that sits in the browser, where
processing is done in the cloud and the persistant game experience is streamed. In the future, I believe we’ll see more
browser-based cloud games than the streaming style of games.
The big players in the casual browser-based space
are Bigpoint, Gameforge, and Wooga. Zynga and Playfish will remain bug on the Facebook side.
There are virtual
worlds like Mindcandy, and Runescape. And there are very exciting things to come from niche players making money online like
Nimblebit, which has Tiny Tower and Pocket Frogs. I’m much more excited about Gaikai’s future, which says we don’t
know exactly how publishers, merchants and consumers want to use this technology, so we’re going to enable them and
let them figure it out. I’m much more comfortable with Gaikai’s flexible approach than with OnLive’s business
Overall, the cloud offers the opportunity to rework your business to be much more capital efficient, to
focus on customers not products and to build long term business by thinking about life-time value, not product RoI. And I
help people make money from games in this world.