Google announces its plan to upend the $140 billion video game industry

The company showed off a new streaming service called Stadia that allows people to play high-end games without purchasing expensive consoles or computers.
Image: Google CEO Sundar Pichai speaks during the Google keynote address at the Gaming Developers Conference in San Francisco
Google CEO Sundar Pichai speaks during the Google keynote address at the Gaming Developers Conference in San Francisco on March 19, 2019.Stephen Lam / Reuters

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/ Source: CNBC.com
By Todd Haselton, CNBC

Google on Tuesday announced its plans to upend the $140 billion gaming industry dominated by Sony and Microsoft with a new streaming service called Stadia that allows people to play high-end games without purchasing expensive consoles or computers. Google said this is a "game platform for everyone."

All of the legwork to render those games is done in Google's cloud.

Google explained a bit how it will work. The company said that if someone is watching a video of a game on YouTube, they could hit a button that says "play now" and jump right into playing the game themselves in as fast as five seconds. Today, gamers have to buy physical games or wait, often hours, for the game to download before they can play. Even then, they also need special hardware to play those games.

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Google says Stadia will run on "any screen type" but it will work on desktops, laptops, TVs, tablets and phones at launch. There's no box at all.

"With Stadia, the data center is your platform," Google said. A gamer can start on one platform and then pick up where they left off on another device, which means you might game on your computer and then continue on your phone when you leave the house.

People will be able to play with a keyboard and mouse or a special Stadia controller that Google will sell. It has a capture button that lets people share their games right to YouTube so that other people can watch. It also has a Google Assistant button, which gives access to the microphone for speaking to in-game features that developers will be able to build into their games.

Google said it will support 4K games at 60fps with HDR but that, in the future, will support games up to 8K resolution. Most people don't yet own 8K TVs and only the most recent gaming consoles from Microsoft and Sony currently support 4K HDR gaming.

AMD helps Google power Stadia's graphics rendering in the cloud. AMD shares were up about 7 percent on news that it was partnering with Google on Stadia.

Google needs game studios to build titles for Stadia. It says developers can build on its cloud or in their own studios. id Software is already building "Doom Eternal" for Stadia and demoed it on stage. Another developer, Tequila Studios, showed its game "Rime" running on the platform.

But beyond that, there weren't many major game titles announced for the system. Google's biggest challenge will be to convince publishers to bring blockbuster games to the platform.

One expert who spoke to CNBC said Microsoft is better poised to offer a streaming video game service, since it already has relationships with publishers in place and a strong fan base of gamers who buy its consoles. Microsoft's upcoming competitor is called xCloud.

"I'd favor Microsoft's chances given it too has the scale and technology but has been successfully engaged in the gaming industry via Windows and XBox for over 30 years," Patrick Moorhead, president and principal analyst at Moor Insights & Strategy told CNBC ahead of Google's event.

Amazon is also reportedly building a cloud gaming service that could eventually run games like "New World," which is developed by its in-house studio but currently only works on PCs.