Cloud Gaming and AI Could End Traditional Game Consoles
A Bloomberg report forecasts the cloud gaming market will reach $38 billion by 2035. Advances in AI and increasing hardware demands may reduce the relevance of traditional game consoles.
Cloud gaming and artificial intelligence (AI) may lead to the end of traditional game consoles by 2035, according to a new industry analysis report by Bloomberg. The report projects the cloud gaming market will grow to $38 billion. As AI advances, games are becoming more complex, requiring higher hardware performance. Streaming games from data centers via the internet is presented as a more efficient solution than regularly releasing new, more powerful console generations.
Traditional game consoles are predicted to lose their position in the mass consumer market. The report suggests that gaming hardware is increasingly becoming a product for a niche of enthusiasts. While consoles may retain value for hardcore players seeking top performance and as collector's items, they are expected to cease being the primary gateway to gaming. They are likely to become a less cost-effective option compared to cloud services.
The analysis highlights that technology giants such as Microsoft, Nvidia, and Tencent are well-positioned to benefit from the growth in cloud services. Microsoft's Xbox Cloud Gaming is anticipated to maintain approximately a 40% market share. Nvidia, as a GPU manufacturer, stands to gain through its GeForce NOW service, while Tencent holds a strong position in the Chinese market.
Nintendo is identified as being in a vulnerable position due to its limited investment in cloud gaming. Sony, conversely, has an advantage with its PlayStation Plus service and PlayStation Portal device, which support remote play. Analyst Nathan Naidu predicts that as data center capacity outstrips demand, the cost of computing power will decrease, improving cost-effectiveness for cloud gaming operators in the future.