Being ambitious isn’t a bad thing by any means, but it seems for Google’s Stadia cloud gaming enterprise there were some setbacks. According to Jason Schreier at Bloomberg, Stadia “missed initial sales targets by hundreds of thousands”, by “trying to take on consoles rather than starting small and spent “astronomical sums” on games like Red Dead: Redemption.
The turmoil within
The report lays out how Stadia aggressively and ambitiously stripped the training wheels off before it had learned to ride at all. It is true that in such industries the winner’s take all much like in mobile where Apple and Google run a DeFacto duopoly. Google is aware of this fact and is trying to be one of the last two standing.
Winner takes all
With Stadia, you buy digital games that you cannot take with you to other cloud gaming platforms unlike Xbox Game Pass Ultimate where you cannot purchase games for use in the cloud, but as a side benefit can leave and go to another service easily because there is no lock-in. Google is trying to create lock-in because that is the only way they will stay relevant and maybe be one of the last two standing.
Google’s model is like a console model in the cloud, they may have well just shipped an actual console because this model may not hold up to the competition that lets you play the whole catalog of AAA titles for monthly subscription. For more money you can subscribe to Stadia Pro, but you have to claim Pro games, this is similar to claiming Xbox Live Gold free games every month, but the primary model for Stadia is purchasing games on the service.
Mindshare is key, how many cloud gaming services can you name? How many can your kid brother name? What services do you think of when the word cloud gaming comes to mind? Mindshare is key.
Google recently pulled the plug on its first-party game studio for developing Stadia exclusives, which means it is now relying on 3rd party game devs to give its platform value in the eyes of new subscribers. Could this move be a harbinger of future events, only time will tell.