A partnership leveraging Nintendo's Switch and Google's Stadia could make a powerful mobile ... [+]
The Google Stadia announcement at the Game Developers Conference (GDC) and recent clarification at the E3 gaming conference have left a lingering question: will gamers play along? The gaming industry is skeptical that users can be convinced to exchange game ownership for subscription-driven services. If streaming is to be successful it will have to capitalize on its unique benefits - play instantly, anywhere, on anything - while simultaneously winning on content and price. And, streaming will need to jive with that intangible gamer zeitgeist - live free, die hard.
Streaming is a hard sell. If streaming and Google’s left-field assault on gaming are to be successful, something needs to change - something big.
The new “mini” Nintendo Switch will take advantage of a two generations of die shrinks to its Nvidia Tegra processor to deliver 1080p mobile gaming to a broader audience. By joining the joycons to the main body of the Switch, Nintendo will squeeze out the expensive and sophisticated wireless joycons and create a mobile-first Switch platform. The die shrink of the Nvidia Tegra processor will provide better battery life and a meaningful upgrade to a 1080p display and graphics in mobile mode. The new mini Switch, and an upgraded standard Switch are poised to address a broader market and capitalize on their growing software and user base. But, there is another opportunity for Switch which has not yet come to light.
“Google is making massive behind-the-scenes investments in original and partner content for Stadia but needs a platform to jump-start user adoption for mobile.” said Simon Solotko, a Contributing Analyst at TIRIAS Research. “On the new Switch, Nvidia will be able to deploy Google's VP9 video codec and Stadia's low-latency protocols to provide 1080p mobile streaming. And, the lower price point will cater to a younger audience perhaps less resistant to a subscription model.”
The Google-Nintendo partnership makes sense. Google needs a vehicle to propel Stadia to a broad audience, and Nintendo needs a path toward streaming. Sony’s recent partnership with Microsoft Azure and Microsoft’s further commitment to Xbox everywhere highlight a competitive shift from content to game delivery for business model innovation.
New technologies threaten the still nascent video streaming paradigm. “Fast start and data streaming - announced by Microsoft and DACS Laboratories - are alternatives which run on existing infrastructures without the cost of game server backends and bandwidth,” continued Simon. “Google has a limited window in which to gain traction and prove the cloud streaming model - too long and it risks discouraging content partners. The new Switch is their Stadia moonshot.”
The author and members of the TIRIAS Research staff do not hold equity positions in any of the companies mentioned. TIRIAS Research tracks and consults for companies throughout the electronics ecosystem from semiconductors to systems and sensors to the cloud. Members of the TIRIAS Research team have consulted for Nvidia, Microsoft, Sony and many other companies in gaming segment.
