Insights is a weekly series featuring entertainment industry veteran David Bloom. It represents an experiment of sorts in digital-age journalism and audience engagement with a focus on the intersection of entertainment and technology, an area that David has written about and thought about and been part of in various career incarnations for much of the past 25 years. David welcomes your thoughts, perspectives, calumnies, and kudos at david@tubefilter.com, or on Twitter @DavidBloom.
Recent developments involving Microsoft, Amazon, and Epic Games‘ Fortnite are giving us a peek at the future of video games, an online-focused, play-anyone, play-anywhere world far removed from the PC vs. console debates of past decades. This cross-platform world will be undergirded by cloud-based services delivering ad- and subscription-based game experiences on all kinds of devices, including increasingly powerful mobile devices running on super-fast 5G networks. The question becomes which companies can take advantage of it all. I think we can pick a few early favorites now.
Microsoft’s new subscription plan.
One is certainly Microsoft, which just announced Xbox All Access, a good deal that looks a lot like the mobile business of recent years, where you got a phone for signing up to a carrier’s service for a couple of years. When the contract was up, you kept the phone.
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So it is with All Access, where you pay $22 to $35 a month for two years. You’ll get access to Game Pass, with dozens of classic and indie titles, and Microsoft’s multiplayer service, Xbox Live. You’ll even save money over just buying an Xbox and paying for two years of its online services. And you get to keep the Xbox when you’re done.
Microsoft already occupied an indispensable position in games, with the Xbox, Windows for PCs, various peripherals and its own studios making such franchises as Halo. The company has been knitting together game play between PCs and the Xbox, and owns Azure, one of the world’s biggest cloud-computing services. Microsoft was already well positioned to take advantage of a transforming game industry, analysts have pointed out, Xbox All Access represents another big step in that direction.
“It’s smart of Microsoft to rethink what they’re doing,” said Seven Volpone, an esports veteran and founder of Subnation, a gamer lifestyle and culture company. “It’s definitely streamlining the gaming process. Sony has to find a solution themselves.”
Sony, which largely dominated this generation of consoles, must evolve beyond the PlayStation 4 to stay competitive.
It already has valuable assets such as the PlayStation Vue Network, a skinny bundle of TV channels, and PlayStation Network, which provides games and online play. Both are subscription services. And Volpone pointed out that even as we head toward a post-console future, the console makers can thrive.
“If I play PlayStation or Xbox, I know what that is,” Volpone said. “This is already a mindset. They’re incredible brands. How do I translate that to mobile? If Sony already has their apps on the mobile phone, they already have a conduit, so it’s really about how they curate that brand and the games you play.”
Amazon, another cloud-computing power, is positioned to be even bigger in games.
It already offers Lumberyard and GameLift, which provide developers with essential infrastructure for online games, and has clients such as Bethesda and Ubisoft.
And of course, Amazon has Twitch and subscription service Twitch Prime, a gamer-focused subset of Amazon Prime. Amazon annoyed gamers recently by ending major perks of Twitch Prime, including big game discounts and ad-free Twitch streams. Amazon pitched the end of ad-free as yet another way to support creators, but Amazon is the real beneficiary. It will know ever more about what gamers watch, buy and play as it continues to optimize its subscriber services and ad targeting.
Twitch has 15 million daily users, 2.2 million monthly live streamers and a dominant share of the audiences for games and esports. Amazon Channels lets Prime subscribers add about 20 premium channels (HBO, Cheddar, PBS Kids) to create customized pay-TV packages alongside Prime Video’s programming.
It’s not hard to see Amazon taking the next step, directly streaming games alongside all that game-related content and live commentary. It could easily create a game version of Amazon Channels with ad-supported or subscription services, perhaps arriving through your Fire TV and shepherded by Alexa.
If you’re as big as Fortnite is, do you really need anyone else?
And then there’s Fortnite maker Epic Games, partly backed by Chinese giant Tencent. Fortnite, the world’s most popular game, blew off the usual app-store debut on Google Play when it launched on Android, securing an exclusive release on Samsung’s store as part of the Korean phone maker’s new Galaxy Note9 phablet.
Fortnite, already generating more than $300 million a month across all its other platforms, is one of the few titles that could forgo Google Play. The move saved Epic an estimated $50 million in Google Play hosting fees. But it also suggests a new era in mobile gaming, where phone makers fight for exclusive early access to high-end titles, much as has been the case in the console business for years.
Mobile revenues comprise around two-thirds of the $180 billion global game market, but the stereotypical mobile gamer is a 40-year-old mother of three playing a match-three title for five minutes while waiting to pick up her kids from school. It’s a vast business, but one that until recently lacked the technology for truly sophisticated game experiences.
Now, that’s changing.
On the hardware side, Samsung joined Razer, Asus, and Huawei‘s Honor brand in releasing powerful devices that can compete online with PCs and consoles. And cross-platform games such as Fortnite really unlock the possibilities. You can not only play Fortnite on your iPhone X or Note 9 against people on more traditional game platforms, you might even win.
Expect to see a lot more cross-platform titles take advantage of the new possibilities, followed by new kinds of esports tournaments too, Volpone said. Mobile games bring in a much broader demographic of players as well, because users can buy, watch and play games anywhere, using a device that they also use for many other things.
“You’re always going to have the purists who are the PC game players and love to play on PCs, and there’s a reason for it,” Volpone said. “What Fortnite has done is open up the mobile gamer. You’ve got guys on a mobile game beating guys on a PC. For the first time, with mobile esports, we’re really seeing a higher rate of women playing. We’re seeing girls and guys play together. It really is building a stronger sense of community.”
