Back to top

Image: Bigstock

Microsoft (MSFT) vs. Google (GOOGL): Who Will Win the Cloud Gaming Battle?

Read MoreHide Full Article

 

Welcome to the latest episode of the Full-Court Finance podcast from Zacks Investment Research where Associate Stock Strategist Ben Rains dives into what we know about Google parent Alphabet Inc.’s (GOOGL - Free Report) foray into cloud gaming with Stadia. Then we break down Microsoft’s (MSFT - Free Report) gaming future and discuss the massive video game industry as a whole to see which company might come out on top.

Microsoft stock has soared 30% in 2019 to help it once again become the world’s mostly valuable public company, with a market cap of just over $1 trillion, which is more than Apple (AAPL - Free Report) and Amazon (AMZN - Free Report) . Meanwhile, shares of GOOGL are up just around 4% this year as fears grow that U.S. government regulators might crackdown on the tech giant and Facebook (FB - Free Report) over their outsized control over the spread of information.

With that said, Google looks poised to expand its business and recently outlined some of its plans for its new cloud-based gaming service called Stadia. The search engine giant said that players will be able to play games across smartphones, tablets, laptops, TVs, and more. Google’s Stadia is set to launch in November on a more limited basis, with its Founder's Edition, which will cost $129. The streaming gaming service promises to let users “instantly enjoy games in up to 4K on your TV without a console. You can also play across laptops, desktops, Pixel 3, and Pixel 3a with cross-screen early access starting from day one.”

Stadia has been referred to as the Netflix (NFLX - Free Report) of video gaming. But it is not as simple as that, and both Wall Street analysts and some of the gaming community seem somewhat skeptical about Google’s cloud gaming plans.  

Meanwhile, Microsoft also recently detailed its near-term gaming future. The firm is set to begin testing its new video game-streaming initiative in October. MSFT’s Project xCloud will allow users to play games without the direct use of consoles. But cloud-based streaming gaming is still in the very early days and Microsoft has set its expectations with this fact in mind as speed and connectivity prove a challenge.

On top of that, Microsoft detailed its next-generation Xbox dubbed Project Scarlett that is set to feature an AMD (AMD - Free Report) chip. The tech titan has also partnered with industry rival Sony (SNE - Free Report) on the PlayStation maker’s own cloud gaming future. In the end, both Google and Microsoft hope to profit from the nascent cloud gaming age. Yet it seems that one company might have the upper hand at the moment.

As a reminder, if you feel that we missed something, or if you have any topic suggestions, shoot us an email at podcast@zacks.com. Make sure to check out all of our other audio content at zacks.com/podcasts, and remember to subscribe and leave us a rating wherever you listen to your podcasts.

Radical New Technology Creates $12.3 Trillion Opportunity

Imagine buying Microsoft stock in the early days of personal computers… or Motorola after it released the world’s first cell phone. These technologies changed our lives and created massive profits for investors.

Today, we’re on the brink of the next quantum leap in technology. 7 innovative companies are leading this “4th Industrial Revolution” - and early investors stand to earn the biggest profits.

See the 7 breakthrough stocks now>>