Yahoo Finance Stadia: Google shuts studio that makes games for struggling cloud-streaming platform
Google has closed down the internal studio that developed games for Stadia, the company’s cloud-gaming platform, raising questions about the future of the Stadia service itself.
Google launched Stadia in November 2019 as a new type of video-game platform that operates without a console and that stores game-playing sessions in the cloud. It lets players jump across devices including phones, PCs and laptops.
But in a blog post on Monday, Google said it will no longer invest in creating its own games for the service beyond any “near-term” planned titles. Jade Raymond, who had headed up Stadia Games and Entertainment, is leaving the company.
“Given our focus on building on the proven technology of Stadia as well as deepening our business partnerships, we’ve decided that we will not be investing further in bringing exclusive content from our internal development team SG&E, beyond any near-term planned games”, Phil Harrison, Vice President and GM at Google Stadia, wrote.
“Given our focus on building on the proven technology of Stadia as well as deepening our business partnerships, we’ve decided that we will not be investing further in bringing exclusive content from our internal development team SG&E, beyond any near-term planned games”, Phil Harrison, Vice President and GM at Google Stadia, wrote.
It's not clear how Stadia itself is faring. The service offers a free tier and Stadia Pro subscriptions that cost $10 a month. Some games are free and some must be purchased separately. Google hasn’t released user figures.
In the blog post, Phil Harrison, general manager of Google Stadia said instead of investing in original games — which can be pricey to create — Stadia will work with third-party publishers to help them bring their games directly to players on Stadia.
Stadia users will continue to be able to play games on the service and Google will continue to bring new third-party titles to the platform.
NPD analyst Mat Piscatella said that because cloud-gaming technology is so new, significant shifts in strategy aren't surprising. But choosing not to offer its own exclusive games on the platform means one less way Google can compete against other more established rivals.
Sony and Microsoft just introduced splashy new PlayStation and Xbox consoles in 2020 that offer exclusive games.
“The development of exclusive content for a platform has been one of the most time-tested strategies in video gaming since the dawn of the console age,” Piscatella said
“We’ll have to see how Stadia’s next phase develops to determine how much this move may impact its trajectory as a platform.”
R.W. Baird analyst Colin Sebastian said the holiday success of the PlayStation 5 and Xbox Series S/X proved that demand for traditional consoles remains high, making it more difficult for Stadia to break into the market.
But he said Google's Stadia technology could still be a success in the long run.
“The cloud streaming technology will be relevant in years to come, and Google should look to license the technology to other companies, or wait out the video game industry until the new console cycle grows long in the tooth," he said.
Google is not the only company building cloud-gaming platforms to compete with or supplement console and PC gaming; last year Amazon launched Luna exclusively in the US initially, at an “introductory” price of $5.99 per month.
Amazon partnered with Ubisoft to give subscribers access to the game publisher’s titles, including Assassin’s Creed: Valhalla, Far Cry 6 and Immortals Fenyx Rising, in 4K resolution.
Additional reporting by Associated Press
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