How Cloud Computing Is Impacting the Gaming Industry (2023)?

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Last Updated on January 11, 2023 by Ashish

Introduction

Cloud computing may be defined as the transmission of computer services via the Internet (the “cloud”). It includes servers, storage, databases, networking, software, analytics, and intelligence. This enables quicker innovation, more adaptable resource management, and cost savings. You typically only pay for the cloud services you actually use, which lowers operating costs, improves infrastructure management, and allows your business to expand as your needs change. Cloud computing has hugely impacted the gaming industry and this market is growing like crazy.

Not every cloud is the same, and not everyone should use the same kind of cloud computing. The development of several models, varieties, and services has made it possible to provide the ideal solution for your requirements.

Types of Cloud Computing (in Gaming)

Public Cloud

Third-party cloud service providers, who distribute their computing resources, including servers and storage, over the Internet, own and run public clouds. With a public cloud, the cloud provider owns and manages all of the hardware, software, and other supporting infrastructure. Using a web browser, you can get to these services and handle your account.

Private Cloud

Cloud computing services utilized solely by a single company or organization are referred to as private clouds. The on-site data center of the business may serve as the actual home of a private cloud. Additionally, some businesses hire outside service providers to host their own clouds. A private cloud is one where the infrastructure and services are kept up on a private network.

Hybrid Cloud

Public and private clouds are combined in hybrid clouds, which are connected by a system that enables data and applications to be transferred between them. A hybrid cloud allows your company more flexibility and deployment options by enabling data and apps to migrate between private and public clouds. It also helps to optimize your current infrastructure, security, and compliance.

Cloud Computing and Gaming Industry
cloud computing gaming infrastructure

Benefits of Cloud Computing (in Gaming)

Cost

The establishment and operation of on-site data centers, which include the racks of servers, 24-hour energy for power and cooling, and IT professionals to manage the infrastructure, are reduced with cloud computing. It adds up rapidly.

Speed

Due to the self-service and on-demand nature of most cloud computing services, even large amounts of computing resources can typically be delivered in a matter of minutes with only a few mouse clicks. This gives businesses great flexibility and reduces the pressure associated with capacity planning.

Global Reach

One benefit of cloud computing services is their ability to elastically scale. This involves supplying the correct quantity of IT resources—such as more or decreased processing power, storage, and bandwidth—at the appropriate time and from the proper place.

Productivity

Hardware installation, software patches, and other time-consuming IT administration procedures are frequently required for on-site data centers. Many of these tasks are no longer needed thanks to cloud computing, freeing up IT workers to concentrate on more crucial business goals.

Performance

The most significant cloud computing services are provided by a global network of safe data centers that are regularly updated with the newest, fastest, and most effective computer hardware. Compared to a single corporate data center, this provides a number of benefits, such as decreased network latency for applications and bigger economies of scale.

Reliability

Cloud computing makes data backup, disaster recovery, and business continuity simpler and less expensive since data may be copied at several redundant sites on the cloud provider’s network.

Security

Many cloud service providers provide a complete set of policies, tools, and safeguards to boost your overall security posture and protect your infrastructure, apps, and data from potential threats.

Cloud Computing and Gaming Industry
cloud computing gaming distributed setup

What is Cloud Computing Gaming?

Cloud gaming is the technique of playing video games on external servers located in data centers. There is no requirement for PC or console game download and installation. Instead, streaming services deliver game data to an app or browser installed on the receiver device, which needs a steady internet connection. Even though the game is played and rendered on a distant server, everything is shown and interacted with locally on your device.

It is comparable to Netflix or any other streaming service. The server from which the video feed is originating may now detect and respond to your inputs, which is the single difference. That means you don’t require a powerful RTX 30-series graphics card, a brand-new Xbox Series X or PlayStation 5, or any other hardware. All you need for cloud gaming is a strong internet connection.

That creates a wide range of opportunities. You may launch cloud gaming software on a Chromebook for incredibly portable PC gaming, or you can grab a phone clip and play the newest AAA games on your phone. Cloud gaming is attractive for this reason, but the technology is still in its early stages.

In most instances, accessing the material for cloud gaming needs a monthly or yearly subscription fee. With certain providers, further game purchases are necessary. For example, in GeForce Now, the games you buy come from other retailers like Steam or Battle.net, so if you ultimately buy the required hardware, you may utilize them locally.

The problem is that these games need a significant wait in line to stream, and even then you can only play for a short time. You gain access to the front and unlimited gameplay by upgrading to the subscription model.

Cloud Computing and Gaming Industry
Gaming is done on Cloud Computing

Adoption of Cloud Computing in the Gaming Industry

The expensive price of gaming equipment frequently results in deficiencies in the gaming experience. It has gotten more expensive to start a business with physical games, especially now that cloud computing is well-established.

Over time, both the number of players and the amount of time spent playing and watching video games online have increased. According to research by the Entertainment Software Association (ESA), 64% of American adults actively play video games.

There is a ton of room for growth in the usage of cloud computing in the gaming sector. About 2.8 billion individuals play video games actively around the world right now, and by 2023 that figure is projected to rise to over 3 billion. By 2022, the total income generated by the video gaming sector is expected to reach $189.3 billion. Additionally, it is predicted that by 2025, the worldwide gaming market would be worth $256.97 billion.

Cloud computing gaming has the power to revolutionize the sector. It is the next frontier in the gaming industry, with numerous large cloud providers offering their services, each with its own set of advantages and disadvantages. The most prevalent businesses are Amazon (Amazon Luna), Google (Stadia), and Sony (PlayStation Now).

Cloud Computing and Gaming Industry
Gaming Setup Desktop

Benefits of Cloud Computing for the Gaming Industry

Security

Companies that use cloud computing utilize industrial-level security to protect against outside disruptions like hacking. Information is kept in a virtual storage area in cloud computing systems, which makes the platform safer than other traditional applications.

Compatible with all types of devices – Even on less powerful devices, high-end games may be played thanks to the highly scalable cloud infrastructure. With the help of cloud solutions, the limitations brought on by memory needs, visual capability, and processing power are reduced, giving consumers an amazing gaming experience.

Lower Costs

Corporations must pay more for bandwidth under typical gaming systems when there is a lot of system traffic. This typically occurs after corporations launch a new video game. Gaming companies use around 10% of server space and bandwidth during peak traffic times and reserve the other 90%. The cloud systems use a “pay as you go” method of payment, so gaming firms only pay for the resources they really use.

Easy Access to Games

Even though the cloud is a highly developed technical idea, it is simple to apply and enables users to access games from any device and place without even downloading and setting up apps.

The End of Piracy

Unlike the previous systems, there is no market for physical game software, reducing the risk of piracy. Gamers play games on cloud servers with access from their own computers rather than on actual PCs. In this way, the cloud minimizes the risk of illegal interference and interruptions while maintaining the game’s excitement.

Expanded Device Availability

Cloud computing allows the use of several devices like cellphones, laptops, palm-held devices, desktops, etc. rather than being reliant on “consoles.” Without even transporting the console, users may enjoy the games from anywhere in the world. Game players may now enjoy moments with a wider variety of gadgets that are part of their everyday usage thanks to cloud computing.

Cloud Computing and Gaming Industry
Cloud-based Gaming Services

Cloud Gaming Services

The major benefit of cloud gaming services is that you will have access to a large library of high-quality games from various game companies. However, there is a monthly subscription that you must pay, or some cloud gaming providers charge by the game. Here are some:

Microsoft Xbox Game Pass Ultimate

For a shockingly low cost, Xbox Game Pass Ultimate enables you to stream a vast library of games to Xbox consoles, PCs, and mobile devices. 

Pros

include an impressive selection of games, a wide range of supported devices, and regular Microsoft upgrades. 

Cons

only a few titles from the Game Pass library may be played.

Nvidia GeForce Now

It is a fantastic choice for experienced players because it allows you to stream games that you already own. 

Pros

You can play games you already own; you may join for free; there are frequent upgrades.

Cons

The top membership level is quite expensive.

Sony PlayStation Now

You’ll have to choose the Premium membership tier, but it’s a small amount to pay to get access to the PlayStation iconic games.

Pros

Numerous subscription tiers, and a wide selection of classic games.

Cons

Pretty expensive, with just PS4, PS5, and PC streaming options.

Shadow

Although it costs a significant amount to use, it grants you remote access to an entire PC.

Pros

Provides full remote access to a PC. You can play whatever video games you have and it operates on both mobile and personal computers.

Cons

Expensive and not gaming-specific.

Amazon Luna

A few games may be checked out for free by Amazon Prime subscribers, and there are several interesting packages available for affordable pricing. However, its library of top games is split among several subscription plans.

Pros

Multiple membership levels, playable on a number of devices, and prime members receive a free monthly game rotation.

Cons

There are many packages in the catalog. Future unknown.

Cloud Computing and Gaming Industry
Keyboard based games

The future of Cloud Computing in Gaming

Due to a network supporting player accounts and in-game purchases, gaming has migrated into the cloud. In order to prevent users from downloading games, game streaming is run in data centers and delivery networks, which benefits both the player and the provider. The reason for trying this transformation are hyper-scale cloud capabilities, international content delivery networks, and streaming media services.

Since practically any device may be used to play games, cloud gaming reduces the requirement for specialized consoles. Gaming corporations may provide a rich experience by influencing telecommunications, internet service providers, and content delivery networks.

In cloud gaming, the system communicates each action a player enters upstream to the game engine as it travels via the network. The game broadcasts the activity back across the network of participants by updating the view and transmitting it. All players must instantly and consistently follow this sequence. Players and activities can get out of sync with more than 75 milliseconds of latency. The challenge is further increased in multiplayer games.

Many of the computer issues that gamers and gaming organizations encounter are being solved by cloud computing. Consequently, it is not surprising that businesses like Google and Microsoft have switched to using cloud gaming services (Google Stadia and Project xCloud).

However, some realists believe that the Internet has processing speed limits by looking behind the hype. However, there may be substantial advancements and fixes for latency and processing issues in the years to come.

We are getting closer to a quicker adoption of cloud gaming services thanks to ongoing innovations. The full use of 5G technology will accelerate cloud computing’s power and promote wider usage.

Cloud Computing and Gaming Industry
Virtual reality mixed with Online Gaming

AWS for Games

Pushing the limits of gaming experiences, game makers are embracing the evolution of the whole industry. Instead of putting in time and effort to manage infrastructure, developers would rather be creating entertaining, creative games that thrill players.

They require cheap, scalable servers that can accommodate tens of millions of players worldwide. Additionally, they must maximize player lifetime value (LTV) using databases that can process terabytes to petabytes of continuously changing data, analytics programs that can access that data with millisecond latency, and machine learning programs that can transform discoveries into fresh, engaging gameplay.

To navigate workload migration from on-premises to the cloud and onboard talent quickly and effectively from anywhere in the world, developers need purpose-built services and solutions. By doing so, they can take advantage of the trend toward remote and distributed game development and reach the market more quickly.

AWS (Amazon Web Services) for Games aligns purpose-built game development capabilities, including AWS services, AWS solutions, and AWS Partners, against six solution areas to assist developers in creating, maintaining, and expanding their games: Cloud Game Development, Game Servers, Game Security, Live Operations, Game Analytics, and Game AI & ML.

By making it more straightforward for game customers to utilize AWS, AWS for Games solutions reduce the number of resources and investments needed to utilize the cloud and achieve a quicker time to value. They also make it easier for customers to choose the correct tools for their desired use cases. AWS has 15 years of expertise assisting major game creators with change.

Cloud Computing and Gaming Industry
Keyboard for gaming

AWS Game Developer Solution Areas

Cloud Game Development

Developers may deploy GPU-powered workstations and flexible, remote studios using cloud game development solutions, which enable artists and designers to operate on several huge files simultaneously.

Game Servers

These solutions enable organizations to operate games on the cloud at scale with safe, resizable compute power while utilizing the AWS global network to deliver unbreakable player experiences on a global scale at the most affordable price.

Live Operations

To maintain player engagement without causing downtime or harming the player experience, production teams need to add new features to games that have already been released and those that are in development. Teams may create and deploy game service capabilities using Live Operations solutions, which shorten development time and scale with player demand while enhancing the user experience and boosting income through monetization and player acquisition/retention.

Game Analytics

Games that generate a lot of data must be collected, processed, and analyzed by production teams, who also require the technical know-how to create, manage, and expand analytics pipelines. In order to decrease operational overhead and complexity and scale to keep up with changes in a data flow, game analytics solutions enable teams to create and deploy purpose-built analytics pipelines that make use of managed infrastructure components.

Game AI & ML

Teams that manage live games must systematically detect harmful activities, stop them, and promote positive relationships among player communities. To improve player experience and overall community health, teams may identify various player cohorts within a gaming community using the Cohort Modeler service on AWS and identify toxic behavior and interactions.

Game Security

Attacks and hacks are on the rise and have the potential to ruin a game and degrade user experiences as more games are being developed as live, constantly updated games. AWS offerings for game security include AWS Shield, which defends against Distributed Denial of Service (DDoS) assaults, and Amazon GuardDuty, which keeps an eye out for suspicious behavior and harmful conduct to guarantee that players have a good time and stay secure.

Cloud Computing and Gaming Industry
Video Gaming build with Cloud computing

Google Cloud for Gaming

Google Cloud for Gaming reduces infrastructure complexity and accelerates data insights with Google Cloud to create fantastic player experiences and empower game developers. It helps by:

Creating Better Games

  • Scaling matchmaking – Utilize the scalability and reuse of an open-source framework with Open Match, a project created in partnership between Unity and Google Cloud, while maintaining control over your match logic.
  • AI-enhanced gameplay services – By utilizing AI skills in areas like content moderation, chat translation, toxicity detection, and more, it can enhance the player experience.
  • Productivity and collaboration – Using Google Workspace and Google Meet, encourage remote productivity and cooperation among your scattered workforce.

Expanding The Game Internationally

  • Game servers – Provide smooth multiplayer gaming experiences by easily deploying and managing game servers internationally.
  • Game databases – Database option from Google Cloud helps power the back end, administer leaderboards, handle player authentication systems, and more.

Better Understanding Of Players Through Data

  • Data warehouse modernization – Make the most of your data with the serverless, scalable, and machine learning-integrated data warehouse.
  • Stream analytics – Ingest, process, and analyze event streams in real-time to quickly and efficiently respond to player demands.
  • Player insights and analytics – Connect, analyze, and display player data in one location with Looker, find whales, and boost UA.
Cloud Computing and Gaming Industry
Gamers focused on Game

Azure for Game Development

With Azure PlayFab managed services, you can speed up game creation. You can also create your own custom game services using the ID@Azure program for independent developers. With adaptable DevOps tools for every platform, you can reach more players globally while safeguarding their data with enterprise-level security. Azure for game creation was created in collaboration with Xbox Game Studios and other cloud game developers across the world.

Additional advantages of Azure for game development:

Keep the players engaged

Scale your gaming experiences safely to include more people and larger game environments. Every day, 1,955 assaults are averted by Azure DDoS Protection.

Boost efficiency and productivity in game creation

Hire additional remote devs, move game development to the cloud, and expand your build farm by adding more virtual machines with only one click.

Give your gamers the games they desire

To keep gamers coming back, use analytics, data, AI, and machine learning to better understand them and adapt the gaming experience.

Create better games with top-notch equipment

Connect Microsoft Visual Studio, Unreal Engine, Azure PlayFab, and more to Perforce Helix Core, Incredibuild, and Unreal Pixel Streaming services in a single cloud.

Cloud Computing and Gaming Industry
Gaming setup with backend on the cloud

Databricks for Gaming

With the openness, flexibility, and machine learning support of data lakes, the Databricks Lakehouse Platform combines the finest aspects of data lakes and data warehouses to give the dependability, robust governance, and performance of data warehouses.

By removing the old data silos that divide and complicate data engineering, analytics, business intelligence, data science, and machine learning, this unified strategy streamlines your contemporary data stack. To enhance flexibility, it is designed using open-source software and open standards. You can operate more effectively and develop more quickly because of its shared approach to data management, security, and governance.

All of your game analytics, data, and AI can be found on one platform with Databricks for Gaming. It can assist you in getting to know, developing, and keeping motivated players. 

Here is why you should choose Databrick for Gaming:

Improve the in-game environment

For actionable real-time insights, combine all of your structured and unstructured data on a single platform.

Improve business results via cooperation

The collaborative workspace for data and AI provided by Databricks enables teams to create and implement solutions more quickly.

Scale according to your game

To prevent over-provisioning and paying for unnecessary computation, Databricks enables you to intelligently scale your data workloads depending on game traffic.

Utilize pre-built ML and AI models

For typical use cases like customer lifetime value, churn prediction, and toxicity detection, Databricks offers Solution Accelerators and a collaborative notebook environment with managed execution for machine learning models.

Cloud Computing and Gaming Industry
Player focussed on Gaming

5G Cloud Gaming

Cloud gaming that is accessible, dependable, and offers the quickest speeds and the lowest latency is now a reality thanks to 5G. As with music streaming on 3G and video streaming on 4G, cloud gaming on 5G has the potential to become a game-changing service for users. The addressable market for cloud gaming is expected to grow at a 15.7% CAGR to reach USD 56.57 billion by 2027, according to a new Fortune Business Insights analysis. That market is overgrowing.

Obviously, there are certain difficulties with cloud gaming that must be worked out. Any form of delay is something that no gamer wants to encounter, and cloud gaming is particularly intolerant of them. Every millisecond counts while playing video games, whether you’re racing a car, playing a virtual sport, or engaged in a fight with hundreds or thousands of other players.

This is where 5G enters the picture. Low latency connectivity may be guaranteed by 5G, creating a special opportunity for service providers to take advantage of the income opportunity. In order to pioneer experience-based pricing offerings that combine both assured connectivity and access to the newest games, service providers can achieve this by collaborating with cloud gaming providers. One such area that is evolving very rapidly is Augmented / Virtual Reality. Additionally, they may be paid for on a per-minute basis for casual players or on a subscription basis for professional gamers who play frequently.

Cloud Computing and Gaming Industry
Cloud-based Gaming backend

Companies Driving Change in Cloud Computing and Gaming

Sony (SNE) introduced “PlayStation Now” in 2014, marking the company’s entry into the cloud gaming market. A major interactive cloud-based gaming firm, Gaikai Inc., was acquired by Sony in 2012, setting the corporation on the path to cloud-based gaming. Hundreds of PS4, PS3, and PS2 titles are currently available to play on-demand with PlayStation Now. Sony was uncontested for a long time, but more and more competitors are increasingly entering the game.

In January 2018, Microsoft (MSFT) purchased PlayFab, a full-service supplier of backend platform services for the creation, release, and expansion of cloud-connected games. Later on, in the same year, Project xCloud was introduced with the intention of providing “excellent experiences for all gamers on all platforms that are fully consistent with the speed and high-fidelity players experience and demand on their PCs and consoles.” Microsoft revealed a public preview within a year in Korea, the UK, and the United States. Microsoft introduced cloud gaming (beta) for Xbox Game Pass Ultimate subscribers in 22 regions in September 2020.

Cloud Computing and Gaming Industry
Keyboard cloud gaming

On the Switch, Nintendo (NTDOY), best known for the adored video game mascot Mario, introduced a cloud version of its products. A download is necessary to start streaming games from a server.

Google launched Stadia, a video gaming platform that offers rapid access to games on any type of screen, in March 2019. Streaming games to a Chrome browser on a basic laptop, playing the greatest games ever developed on your phone, and playing games on your TV in 4K without a console are all now possibilities thanks to Stadia, which made its official debut in November 2019. Numerous other additions have now been revealed.

Technology for cloud gaming is constantly being developed by NVIDIA (NVDA). In the middle of 2017, GeForce NOW for Macs was released in beta as an outcome of its research and development.

Cloud Computing and Gaming Industry
Cloud-based gaming

Conclusion

Cloud computing has been shown to be a disruptor in the game industry due to the increasing data usage in the digital world. In order to demonstrate the scope of how the cloud is altering the gaming business and creating new opportunities for service providers, there are also included a number of astonishing statistics in the post.

Because it is cost-effective and concurrently provides a flawless gaming experience on mobile and desktop platforms, cloud gaming appeals to a lot of players. A huge range of top-notch games will also be available to players without costing outrageous amounts.

Additionally, a large audience will find it much easier and more convenient to join a cloud gaming platform with the rollout of 5G networks. In conclusion, the anticipation is that this industry will draw the largest population of gamers as technology advances and more digital giants make this service available to their consumers.

The core of cloud gaming is best summed up by an extract from a Microsoft blog post that reads, “The future of gaming is a world where you are empowered to play the games you want, with the people you want, whenever you want, wherever you are, and on any device of your choice.” A growing number of businesses are putting effort toward realizing that vision.