Google will ultimately not develop any exclusivity for its in-house cloud gaming service. The firm has announced the closure of its studios.
It’s been less than two years since Google announced the opening of its first in-house studio run by industry veteran Jade Raymond. This studio will unfortunately not have the opportunity to show the fruits of its labor. This will not be the case either for the one opened in Santa Monica at the beginning of 2020, nor for Typhoon Studios acquired at the end of 2019.
First revealed by the site Kotaku, then confirmed in the wake by Google, the giant will close all its internal studios to redirect the development of Google Stadia its cloud gaming service.
Google is not a content producer
In its press release announcing the closure of the studios, Google explains that it has confidence in its technological platform. It is true that if Stadia has convinced on one thing since its inception, it is of course the quality of the technology used and the functions offered. The firm wants to invest to develop this segment, to the detriment of the creation of original content. Phil Harrison explains that budgets to develop some of the best games in the industry are growing exponentially and that Google is no longer willing to invest in this direction.
It must be said that the industry has passed for several years in an arms race where Sony, but especially Microsoft, strengthens their internal teams to be able to have a group of studios that can produce exclusives regularly. Recently Nintendo bought one of its partner studios so as not to let it go to a competitor.
2020 has been a very significant year for Stadia
From this decision, less than two years after the launch of Stadia and its studios, we can draw some reasoning. First, you have to understand that 2020 was a year of all records for video games: all the lights were green. A few hours before Google’s announcement, Nintendo set new sales records with its Switch.
In this year 2020 when competitors were preparing their next-gen consoles, and where the whole world was confined and therefore very receptive to the idea of a cloud gaming solution, Google Stadia has not really managed to find its audience. As Oscar Lemaire noted on Twitter, on one of the biggest games of the end of the year, Stadia made up just 0.2% of users. In the last month of the year, with the release of Cyberpunk 2077, a third-party game, the service experienced its first success.
FYI, during the launch period of one of the biggest games of the end of 2020, Stadia is 0.2% of users.
– Oscar Lemaire (@oscarlemaire) February 1, 2021
And then there is the takeover of Zenimax / Bethesda for 7.5 billion dollars by Microsoft announced at the end of the year, with its 2,300 employees. To really compete with Sony and Microsoft on exclusives, Google would have to make the same kind of investments. However, by not seeing its service take off in a record year, the firm may have concluded that this was not the right direction for it.
What future for Google Stadia?
Google wants to be reassuring in its press release: the service is not closing its doors. You can continue to play the games you purchased from Stadia or take advantage of the Stadia Pro membership. The firm mentions in particular that it wants to continue adding titles from third-party studios on its service.
One can however wonder about the future of the service for consumers. First, which studios will be convinced to invest in a port of their game for Stadia when Google themselves no longer wish to invest in content for the platform? Is the firm ready to finance portages or even pay temporary exclusives for its platform? These are questions that Google will have to answer.
For now, the public may start to worry that Stadia is taking the same slope as other services before it. When posting the Kotaku article, the site Killed By Google, which lists all the projects abandoned by the firm, was on everyone’s lips.
Towards a technological white label?
A perspective opened by the Google press release, and which has been proposed several times by analysts, would be for the firm to create a white label technological platform. Major third-party publishers in the industry like Ubisoft want to keep control of their catalog and licenses, but also their names. Google could offer them a turnkey solution to create a cloud gaming service in their image. This is one of the reasons that prompted EA to rename the Origin service on PC to EA Play, and Ubisoft to transform Uplay / Uplay + into Ubisoft Connect and Ubisoft +.
With Stadia, Ubisoft could, for example, offer its game catalog in streaming through the Ubisoft + subscription, without going through PlayStation, Xbox or Nintendo, and thus keep a strong weight in the negotiations around its games. Google is therefore far from leaving the video game industry for the moment, but the question of its commercial service to consumers is not fully clarified.