Thinking About Google’s “Big Bet” on Games (Premium)

Google this week is touting its “big bet” on games as part of an effort to transform the Play Store into the premier platform for games.

This strategy makes sense: The Play Store is already the world’s largest mobile apps store and games are, by far, the most popular type of mobile app.

And from a competitive perspective, Google certainly has a lot to worry about. Apple, of course, whose iOS platform performs astonishingly well against Google Play despite its much smaller size. But also more traditional game platform makers. Companies like Sony and Nintendo, which dominate the market for standalone gaming hardware. And even companies like HTC and Oculus Rift, which are trying to take gaming into new dimensions with their virtual reality (VR) offerings.

Oh, and Microsoft too. Let’s not forget about Microsoft.

There’s a gaming revolution happening at Microsoft right now, and the firm has seized on this market as one of a handful that can really matter to it down the road. Watching Microsoft (re)embrace gaming in the wake of ridiculous and half-hearted past efforts like Games for Windows Live is amusing on the face of things. But that’s only true if you don’t understand how serious this is.

For Microsoft, games are one of only a handful of pillars that it sees for the future success of the company. It has elevated executives like Phil Spencer and Matt Booty to senior leadership positions where they will help guide the software giant’s overall strategies moving forward. It has vastly expanded its current gaming services in ways that far surpass anything that Sony or Nintendo are doing. And it has set itself up for a future in which games will be delivered from the cloud to devices of any kind, eliminating the need for standalone consoles.

As I’ve pointed out in the past, this strategy makes tons of sense. After all, today’s market leaders—Sony and Nintendo—have great advantages over Microsoft today, and they sell many more consoles than Microsoft does. But when that market disappears, and it will, it is Microsoft that emerges victorious: Sony and Nintendo simply do not have the capacity or expertise—or, most important, the intestinal fortitude—to dominate a future generation of broadly-compatible cloud-hosted game services. These companies are so laser-focused on serving only those customers who use their own devices that they will further hamper their abilities to compete in the future.

Of course, what I’ve forgotten about in all this dreaming is that Google exists. And Google exists, at least in part, to throw a wrench in virtually everything Microsoft does. Doing so seems to be baked into its DNA. Witness its efforts around such things as office productivity services, which it gives away for free.

Last week, I pointed to a Google effort to create an open source, cloud-hosted platform for game makers that could democratize the hosting of multiplayer game servers. This effort, called Agones, is a direct threat to what I’ve long considered to be the future of Xbox Live, and since it will not be controlled by Google or any other company, it will be attractive to, well, virtually all game makers.

This week, the Game Developers Conference 2018 is underway in San Francisco. And Google, predictably, is on hand to announce new games initiatives. We’ve written about a few, in fact, including the expansion of instant apps to include games, new tools and APIs for game developers(including a really cool way to make games that utilize Google Maps), and, of course, ARCore.

But it really interesting to see how Google is positioning itself for the future.

“We’ve been working hard to make Google Play the premier platform for game discovery and a place for you to grow your business,” a Google blog post aimed at game developers explains. “In the last year, the number of Android users who installed a game has more than doubled. Nearly 40% of that growth came from emerging markets, including Brazil, India, Indonesia, and Mexico.”

That post only uses the phrase “mobile games” once, in the headline. But it mentions games more generally dozens of times. I think this is deliberate. While Microsoft is busy mobile-izing Windows 10, Google is likewise doing what it can to mature its own platforms, Android and Chrome OS, to better address broader use cases. And let’s not forget about game streaming and eSports: Google owns YouTube, the premier video delivery service on earth.

But think back to that vision I had for Microsoft’s future in gaming: cloud-based delivery of games to devices of any kind. In a world in which the client is almost an afterthought, users will simply choose the device they already have. And that device, by a wide margin, is usually Android.

That Android might win on the client when it comes to gaming seems rather obvious. But that Google might try to usurp Microsoft’s cloud-based initiatives to deliver those games was, at least to me, a bit more surprising. In retrospect, it shouldn’t have been.

Given this, it’s not hard to imagine what companies like Google and Amazon might do to stay relevant in this future of gaming. And, of course, it’s not like Sony and Nintendo are going to let these newcomers rise to prominence without a fight.

But I admit to being blindsided by Google. I should have seen this coming, given the aggressive and predatory way it competes against all things Microsoft. Plus, it already dominates the personal computing devices and services markets. What else was it going to do?