Microsoft released its first video game in 1981, appropriately named Microsoft Adventure. It was an MS-DOS game that booted directly from a floppy disk and set the stage for Microsoft's adventures in gaming. A lot has changed in the last 37 years, and when you think of Microsoft's gaming efforts these days, you'll immediately think of Xbox.
It's also fair to say that a lot is about to change in the coming decades, and Microsoft is preparing.
Microsoft has been developing this move for a while. The company has been mysteriously acquiring gaming-related companies in recent years.
From Havok in 2015 , Simplygon in 2017 to PlayFab earlier this year You've probably never heard of any of them, but they are important to Microsoft's bold cloud gaming ambitions. While these acquisitions were taking place, Microsoft has reorganized its gaming teams as the company prepares to launch its own cloud gaming services.
Phil Spencer is now Microsoft's head of gaming and reports directly to CEO Satya Nadella. Microsoft's new gaming cloud division is headed by Kareem Choudhry, a 20-year Microsoft veteran who has worked on Outlook, DirectX and Xbox engineering.
MICROSOFT'S NEW GAMING CLOUD DIVISION STARTED LATE LAST YEAR
"Phil really wanted a dedicated team focused exclusively on cloud gaming," says Choudhry, in an interview with The Verge . "Those were the conversations that started happening last summer, and we really started creating the structure of the organization late last year." The new division is designed to attract game developers and publishers to use Microsoft's cloud services. Ubisoft has been using Microsoft's Azure cloud services on PC, Xbox, and PS4 with Rainbow Six: Siege recently, and even the mobile game Black Desert uses Azure virtual machines and databases. Microsoft wants more and more game developers to use its cloud, especially as games become more connected on all devices for your multiplayer experiences.
MICROSOFT WANTS TO REACH 2 BILLION GAMERS WORLDWIDE
"We believe there will be 2 billion gamers in the world, and our goal is to reach every one of them," Choudhry explains.
Part of the way Microsoft will come up with its new cloud approach to gaming is with subscription services. Sea of Thieves is the first major title but the future sets of Halo yGears of War will also be available. "We're very happy with the success that's happening [with Game Pass]," says Choudhry. "
Despite the challenge, Choudhry hints that Microsoft could accomplish this by streaming games to devices. "We're looking at ways to make that content available to anyone, no matter what device they're on," Choudhry says.
It seems like every couple of years a new service comes to life, promising to stream games from powerful servers. Sony acquires streaming game service OnLive just to turn it off, and Gaikai previously acquired, which eventually became part of its PlayStation Now game streaming service. Sony suspended the transmission of the game to PlayStation 3, PS Vista, PlayStation TV and smart TVs and Blu-ray players last year, and decided to focus on PS4 and Windows PCs. Game streaming is a challenging service to get right, and even Nvidia is trying its luck for PC gaming .
Microsoft has Xbox game streaming teased in three years and will clearly be a big part of the new cloud gaming division. "We spent a lot of time thinking about that space," Choudhry explains. He says a "lot of things" have to come together, including creating a business model that is attractive to third parties.
Reaching 2 billion gamers is an ambitious target even for a new Microsoft that is focusing on aggressively in the cloud .