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Microsoft just low-key announced the first true ‘Netflix for games’

Microsoft has lobbed a grenade into the cloud gaming arena. A grenade packed full of exclusive games that competitors can’t hope to match.

This news came from Phil Spencer’s recent interview with The Verge about the Xbox chief’s most recent post on the Xbox blog. Spencer’s post alludes to xCloud and, in the interview, he clarifies that Microsoft is “putting it in Ultimate for no additional cost.” This will happen in September.

Project xCloud, which so far exists only as a limited beta, is launching behind competitors like Google’s Stadia and Nvidia’s GeForce Now. Still, this announcement could blow up their plans.

The Netflix of gaming. For real, this time

Google’s Stadia enjoyed mainstream buzz as rumors circulated in early 2019. Much of the hype was based on the hope that Stadia would become “Netflix for games” by providing games, and the means to play them, for one low monthly fee.

That expectation seems silly today, but it gained real traction in early 2019. CNN, Business Insider, and The Washington Post (among many others) ran articles anticipating how Google’s “Netflix for games” could change the industry. Those hopes were dispelled in June when Google dished out all the details. Stadia has a slim selection of free titles, which rotate out over time, and most aren’t exclusive to Stadia. Most games are purchased at retail prices.

Microsoft, however, has the goods. Xbox Game Pass Ultimate is a $15-per-month service that includes access to the entire Game Pass library, which now spans hundreds of games. Project xCloud will only have access to about 50 of those games when it launches for subscribers in September, but that includes important exclusives, not least of which is the Halo franchise, including Halo: Infinite (when it’s complete — Infinite’s release window is holiday 2020).

Xbox Game Pass already mimics the Netflix model to a degree, offering hundreds of titles as part of the subscription. However, players still have to download what they’d like to play and make room for it on their local hard drive.

Project xCloud will eliminate that problem. Players will be able to browse for games and, once they’ve found what they want to play, jump in with the press of a button. This finally delivers the seamless streaming experience the phrase “Netflix for games” promises.

This is just the start

Sounds good, doesn’t it? But wait! The analogy doesn’t end there. Microsoft’s strategy for Project xCloud mimics Netflix not only in the delivery of content, but also in how it’s produced.

Netflix isn’t just a streaming service. It’s also a content platform serving up hundreds of exclusive shows. Want to watch Stranger Things, Glow, or Orange is the New Black? Then you need Netflix. This helps Netflix bring in new viewers eager to watch a hot new show everyone is talking about. This strategy has become the default for all streaming video services, from Hulu to HBO to Disney+.

Xbox has struggled in this area recently, losing out to better exclusives on Sony’s PlayStation console. To fix that, Microsoft went on a buying spree in 2019. It acquired several midsized studios, including Ninja Theory, Undead Labs, and Playground Games Limited. These join other studios long owned by Microsoft, like Mojang and 343 Industries.

These studios aren’t building games just for Project xCloud, but their work will largely be exclusive to the Xbox platform, which xCloud is a part of. This gives Microsoft’s cloud gaming service a way to deliver high-profile titles that alternative services can’t match.

PlayStation Now is the only competitor with potential access to better exclusives. However, Sony’s cloud gaming service is a $9.99 stand-alone subscription (sold separately from PlayStation Plus). Sony is also reluctant to put its best new games on its streaming service. You can play older games, but recent exclusives like Ghost of Tsushima and The Last of Us Part II aren’t there at the moment.

The fog around cloud gaming is lifting

Google’s decision not to follow the Netflix model with Stadia threw cold water on cloud gaming and contributed to our mediocre review of Stadia at launch. Other recent kerfuffles, like Nvidia’s failure to inform developers it would allow access to their games on its GeForce Now service, didn’t help. These missteps put a haze around the future of cloud gaming.

At its core, though, cloud gaming offers a simple and attractive hook: Instant access to numerous games for one low monthly fee. No installs, no patching, no waiting. Just pick a game and go. Microsoft is the only company that currently has the desire and capability to fulfill this promise.

This doesn’t mean xCloud is preordained to win the cloud gaming war, but Microsoft’s decision to bundle cloud gaming with all Game Pass Ultimate subscriptions puts the competition on notice. Google, Nvidia, and Sony must serve up more value to compete with the coming Xbox juggernaut.

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