Microsoft and Sony have been fierce rivals in the gaming industry for more than a decade. So, it came as a big surprise when the bitter rivals announced a strategic partnership on Thursday to offer the “best and most immersive entertainment experiences” to gamers. The two companies will work together in cloud computing, content streaming services, and AI. What was the driving force behind the surprise Microsoft-Sony partnership?
Joining hands on cloud gaming, AI
The announcement was scarce on details. The two companies said they would explore joint development of future cloud solutions in Microsoft Azure to support their respective gaming and content streaming services. They will also work together on new image sensors that combine Sony’s image sensor technology with Microsoft’s Azure AI technology.
Excited about the opportunities ahead with @Sony for us to pursue our mutual gaming ambitions and delight players around the world. https://t.co/3vBuQiruiR[Exclusive] ExodusPoint Is In The Green YTD Led By Rates And EM/ Macro Strategies
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— Phil Spencer (@XboxP3) May 16, 2019
The aim is to provide better entertainment experiences to gamers around the world, which also involves creating better platforms for developers. Notably, there is no mention of the upcoming Xbox or PlayStation consoles in the announcement. The wording indicates that the Microsoft-Sony partnership is about their future gaming services rather than consoles. The fruits of the partnership could still be a few years away.
Sony will be using Microsoft’s Azure cloud solutions for its own game and streaming services. “I believe that our joint development of future cloud solutions will contribute greatly to the advancement of interactive content,” said Sony President Kenichiro Yoshida.
Sony needed Microsoft’s cloud infrastructure
The gaming landscape is changing rapidly. Microsoft is preparing to launch its streaming platform xCloud, which will allow gamers to play Xbox One games anytime, anywhere. They can play Xbox games not only on consoles but also on computers, smartphones, and tablets. Google has already announced its Stadia game streaming service. Both of them promise to stream even the most graphically advanced games over the Internet to difference devices.
Amazon is also working on its game streaming service. Competition in the online game streaming sector is going to be fierce. Sony already has its own streaming platform called PlayStation Now. The Japanese company has made considerable investments in PlayStation Now in the last five years, but the service has tasted limited success.
Sony doesn’t have massive data center facilities needed to drive the future of online game streaming services. As Matt Weinberger of Business Insider points out, there are only a handful of companies that have built a large, efficient, powerful, and advanced cloud infrastructure. And Microsoft happens to be one of them. The two companies have collaborated in some areas in the past, and it’s not a bad thing to partner on one more thing if it benefits them both.
Sony needed Microsoft’s cloud infrastructure to stay competitive in the game streaming business. It’s not yet known whether Sony will use Microsoft’s cloud computing muscle to strengthen its PlayStation Now service or build a new service.
Microsoft, Google, and Amazon have invested billions of dollars over the years to build data centers and improve their efficiency. Microsoft recently launched Azure Game Stack to help developers build new games on Azure more efficiently.
Microsoft has announced that it plans to “go big” at the next month’s E3 2019 conference. It is expected to unveil a bunch of new titles at the event. Microsoft is also working on two new consoles code-named Anaconda and Lockhart, but it’s not yet known whether these consoles will make an appearance at E3. Sony, for the first time in years, has decided to stay away from E3. At its Build conference earlier this month, Microsoft presented its vision for AR gaming.