Japanese game publisher Capcom is introducing a cloud-based streaming service to add high-end games to Nintendo’s Switch. Last month, the company released a cloud version of “Resident Evil 7” for the Switch in Japan, priced at $18 for 180 days of access, compared to as much as $50 for a downloaded version. Up until now, the video game industry hasn’t fully adopted cloud services because — rather than simply streaming a selected song or video – the servers would have to respond without lag to unpredictable game play.
The Wall Street Journal reports that, according to sources, Capcom, “maker of ‘Mega Man,’ ‘Street Fighter’ and ‘Monster Hunter’ franchises, is looking at other titles to include in its cloud service.” A spokeswoman said that the company will “decide whether to expand its cloud offerings after assessing the performance of the ‘Resident Evil 7’ Switch version.”
Sony, with its PlayStation Now service, and Square Enix Holdings are other game companies beginning to invest in cloud services. The latter has released “Dragon Quest X” and other titles for Nintendo’s 3DS device via the cloud, in Japan. Streaming a game can extend the life of a title and “provide regular revenue through monthly fees.”
To make cloud-based game services viable, companies need to “sort out the business model for a game service, including how profit would be shared among software makers, hardware makers and the telecommunications companies that connect the remote server to the consumer” as well as nailing the technology to make it work. Much of the problem lies with Internet services, which can be inadequate for game play, especially if a consumer shares a connection. The industry is betting that 5G “will address the problem with faster and more-reliable Internet access.”
Creating a cloud version of a game “doesn’t require much investment,” and “the Switch is less powerful than the other game machines,” with users downloading a small “client” program. With most of the software in the cloud, “Capcom relies less on the Switch’s computing power and saves money in adapting the game.”
Analysts said “game makers are likely to release their major titles first as packaged or downloaded software for purchase at a higher price, and then make them available over the cloud later,” a strategy described by IHS Markit analyst Piers Harding-Rolls.
Factors mitigating broad success of Capcom’s attempts to stream games include the fact that Nintendo “tends to take a conservative approach to any technology that isn’t ready for the mass market, including virtual reality” and that “cloud gaming goes against the Switch’s key concept of ‘play anytime, anywhere, with anyone’ because it requires the device to be connected continuously to the Internet.”