Thoughts on Google Stadia announcement

A convoluted pricing scheme and bland title inventory tell us that this is a tech play more than a fully formulated strategy to become the leading cloud gaming platform.

Credit: Google

Credit: Google

Google ran out ahead of the usual annual slew of announcements at E3 by releasing a video detailing its title line-up and pricing plans at launch. However, content-wise, the Stadia offers nothing new. None of the titles allude to anything that is uniquely geared to a cloud gaming platform and seem rather focused on leveraging Google’s data centers as a distribution channel.

Moreover, the announced line-up skews heavily towards the traditional apocalyptic shooter category and is riddled with grunting men. Why not have a slick indie program for all small and medium-sized content creators out there? This could be so much more exciting for a larger audience.

Historically the initial success of a new platform, whether a physical console or a digital distribution platform, depends squarely on offering exclusive titles that resonate with audiences. To that end, Google clearly opened its wallet. But, as is to be expected, there isn’t anything that really jumps out or is exclusive. That will manifest itself in slow consumer adoption.

More important than the hardware specs is the content inventory available at launch. Based on what Google showed us, they’re clearly targeting the traditional, hardcore gamer audience. At first glance, that seems like a miss because interactive entertainment is mainstream now. Catering a broad, diverse consumer base is what made services like Netflix popular.

One of the main challenges around cloud gaming today is pricing. The generally accepted idea that consumers had ‘hoped’ for a Netflix-type service is false. In a consumer study we conducted in March this year, almost half (48%) of respondents indicated that they had no interest in committing to a monthly subscription. It is, in fact, one of the biggest deterrents among active gamers. Having to pay for a subscription and buying titles separately, as Google is presenting will present a big hump for consumers, especially since many of its current titles are available everywhere else.

Consequently, I have no reason to change my stance that Google’s strategy should be regarded as a ‘tech play’. It is not a firm known for its amazing relationship with content providers. Naturally, publishers have gladly accepted Google’s cash in exchange for testing market demand and the service offering of Stadia. Across the board, we’re seeing titles that have been out for a while and which present a relatively low risk for content creators. This has the danger of prioritizing volume over quality which will not sit well with, especially, early adopters. People will be hyped up about this new service only to find a largely bland content offering.

Finally, let’s not overlook the fact that Sony and Microsoft are formidable incumbents in this context. Both of them have sunk billions in building a global user base. And their recently announced partnership (which even bypassed the PlayStation division) is a clear indicator that they are committed to this emergent category, and ready to play ball.

Just because Google is first at the pool doesn’t make it the best swimmer.


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