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Sony and Microsoft team up on cloud gaming, ahead of Google Stadia

Sony and Microsoft are teaming up to develop new technologies for cloud-based gaming services, a move that looks to shore up both console makers as Google’s planned game streaming service, Google Stadia, prepares to enter their market.

Obviously, the two companies’ PlayStation and Xbox platforms have current hardware and software that compete directly in this space. But their collaboration “will contribute greatly to the advancement of interactive content,” Sony’s chief executive said in a statement released by Microsoft.

The two console gaming rivals signed a memorandum of understanding under which both companies will “explore joint development of future cloud solutions in Microsoft Azure to support their respective game and content-streaming services,” the statement said. That will include using Azure data center solutions for Sony’s existing game streaming services. “These efforts will also include building better development platforms for the content creator community,” the statement said.

Microsoft Azure, dating to 2010, is the company’s cloud computing software and managed data center service. The most immediate upshot of the partnership is that this could be bad news for Azure’s main rival, Amazon Web Services. But the alliance also appears to address a competitor that will soon enter the fray — the Stadia game streaming service that Google unveiled at Game Developers Conference 2019.

In the ideal vision Google presented in March, Stadia would do away with game consoles’ necessity by streaming video games, instantly, in high definition, and with high frame rates, to a myriad of devices simply by clicking a hyperlink.

PlayStation already offers a cloud gaming service — PlayStation Now, a streaming service launched in 2014. The service allows subscribers access to a library of more than 700 PlayStation, PS2 and PS4 titles for $19.99 a month. Microsoft’s Game Pass, while not a streaming service, offers subscribers access to a curated library of 200 games for $9.99 a month. In September PlayStation Now announced it would follow Game Pass’s suit by enabling downloads of games in its library, for playing offline.

Microsoft does have a games-streaming solution in the works, xCloud, which it announced last October. Microsoft is expected to give xCloud a significant portion of its E3 2019 presentation next month.

Sony and Microsoft’s cooperation will also extend to artificial intelligence and semiconductors (although not for gaming or streaming applications). But most of Thursday’s announcement, and reaction to it, focused on video games and the two rivals coming together in the face of a new threat. “For many years, Microsoft has been a key business partner for us, though of course the two companies have also been competing in some areas,” Sony CEO Kenichiro Yoshida said. “I believe that our joint development of future cloud solutions will contribute greatly to the advancement of interactive content.”

“Sony has always been a leader in both entertainment and technology, and the collaboration we announced today builds on this history of innovation,” said Satya Nadella, Microsoft’s chief executive officer. “Our partnership brings the power of Azure and Azure AI to Sony to deliver new gaming and entertainment experiences for customers.”

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