The Cloud and the Death of Gaming

Apparently various cloud-enabled functions and games are all the rage at E3 [the video-gaming trade show] these days.  Famous game designer John Carmack in fact predicts that streaming services like OnLive will become the norm.  While OnLive is fascinating, and an experiment that I hope works out well (I should really try it), I just don’t know if this is true.
I am inclined to guess that the future doesn’t lie in purpose-built consoles using locked, proprietary operating systems and hardware that stays stagnant for five to seven years.  Don’t get me wrong, there are huge advantages to doing things that way, specifically that a stable platform allows developers to really squeeze the hell out of it for every last bit of performance.  Xbox games today are much more visually impressive than when the platform launched. Still, though, the hardware limitations start to become very apparent within two years of the platform’s launch, thanks to the inexorable progress of Moore’s Law and PCs rapidly overtaking consoles’ visual processing abilities.  For most of the platform’s lifetime, this is not great but okay, as the distance from the screen renders that difference in fidelity not that big a deal.  As it starts to become overwhelming, as it is today for the Xbox/PS3, that’s when the new generation is rolled out.
I have a hunch that a similar dynamic might actually hold for PC gaming and OnLive-style streamed gaming.  The limiting factor for OnLive isn’t raw computing power, for which it can achieve massive economies of scale – it’s bandwidth to transmit player orders with very low latency and to pipe back video at very high fidelity, which I don’t think it can do right now.  A bet that OnLive will displace PC gaming is basically a bet that bandwidth growing affordability and availability will outpace processing power’s growing affordability and availability.  I would gladly take the other side of that bet.  On the other hand, video fidelity is a lot less important in the console space since you sit much further away from the TV, and so OnLive will become feasible as a console-killer much sooner.
It won’t matter once a critical threshold is crossed, where OnLive can flawlessly transmit player controls AND pipe back full 1080P video AND internet connections in the American home are reliable enough that connections won’t drop all the time in the midst of all this playing AND Comcast doesn’t spike your bandwidth because you’re sucking down more than the rest of the block.  But I feel confident saying that’s a long time in the future.

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