Alphabet’s (GOOGL - Free Report) division Google is set to revolutionize the gaming industry with its concept of game streaming service.
The search giant is geared up to roll out its streaming game service at 2019 Game Developers Conference (“GDC”). The move will mark as one of the company’s major steps in the gaming space. Additionally, Google focuses on leveraging its robust cloud capabilities to add efficiency to its soon-to-be-launched gaming service.
Per sources, the company is about to unveil a console hardware — Yeti. The device is likely to act as a streaming box that will help in connecting the service with TV. The feature will enable gamers to stream their content on TV.
Notably, the service rules out the requirement of high-end gaming devices and will be compatible with any desktop, laptop, smartphone as well as TV.
We believe that the company will gain momentum among gamers with its latest plans.
Intense Gaming Competition
Gaming industry is booming on the back of higher consumer spending on video games across the world. Per a IDC report, the industry has generated revenues worth $136 billion in 2018.
Further, the report suggests that the industry is growing at a rate of 15% every year, which presents immense opportunities. We believe that Google with its cloud-based game streaming service will be able to rapidly penetrate this booming market.
However, growth potential in the market is alluring enough to attract other tech giants like Amazon (AMZN - Free Report) , Microsoft (MSFT - Free Report) , NVIDIA and Sony (SNE - Free Report) among others. We note that these companies are leaving no stone unturned to bolster their presence in the gaming space.
The e-commerce giant has unveiled an all-in-one toolkit at the ongoing GDC. The toolkit is targeted toward game developers and comprises back-end services, SDKs, analytics and monetization tools. Apart from the latest launch, the company already offers a huge game streaming portfolio via Twitch.
Meanwhile, Microsoft owns the huge video gaming brand, Xbox. It is planning to develop a streaming box that will offer streaming services for video games on Xbox consoles with the support of its cloud platform, Azure.
Further, the company introduced a development kit called Game Stack that includes services like Azure, Xbox Live, App Center, PlayFab and others at GDC. Additionally, it is gearing up to launch trials of dubbed XCloud, its cloud streaming service for games.
Further, Sony has its cloud gaming subscription service namely — PlayStation Now— that streams a huge library of video games on PlayStation 4 and PC.
NVIDIA’s GeForce GPU includes a library of 400 games. The service works on its own Android-based Shield console that is compatible with TVs, Macs and PCs.
We note that strong endeavors of these companies will continue to intensify the gaming arena.
Google’s Aggressive Stance
Google’s upcoming streaming service seems to be the commercial version of its Project Stream that was launched in 2018. It is a subscription-based streaming service for AAA video games that usually includes graphically-rich content.
Further, the company is aggressively looking for deals with developers to release interesting games on its platform. Its partnership with UbiSoft Entertainment, a video game publisher, has facilitated the streaming of Assassin’s Creed Odyssey via Chrome on Project Stream.
Google has appointed the former Playstation and Xbox executive — Phil Harrison — as Vice President. Moreover, its vast base of developers is a major positive.
We believe Google’s cost-effective game streaming service and growing initiatives to strengthen footprint in the gaming industry is likely to fortify its market position.
Currently, Alphabet carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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