Video game companies shifting to the cloud has sparked an infrastructure arms race to build more data centers so as to achieve low latency and zero packet loss
Cecilia D'Anastasio / Wired : Tweets: @poweredbyinap and @molleindustria Tweets: Inap / @poweredbyinap : In a new article from @WIRED on IT infrastructure and the future of gaming, INAP's Jennifer Curry, SVP of product and technology, weighs in on the effect lag and latency have on cloud-based gaming. Read the article: https://www.wired.com/... Paolo Pedercini / @molleindustria : Amazing how much investment is directed towards saving users a couple of clicks and denying them ownership of the games they pay for https://www.wired.com/...
Context & Ripple Effects
Streaming has been inching toward viability since early experiments showed latency falling as data centers multiplied and 5G rolled out, and by mid-2019 the fight had crystallized into a three-way platform contest, with Microsoft, Amazon, and Google racing for dominance in a $152B gaming market. What Wired adds today is the physical underside of that contest: winning at cloud gaming means building out data centers fast enough to deliver low latency and zero packet loss.
First-order effects
- Infrastructure providers like INAP — whose SVP of product and technology Jennifer Curry flags lag and latency as the make-or-break variables for cloud-based gaming — are pulled directly into the gaming market as capacity suppliers rather than background vendors.
Second-order effects
- The hyperscaler platform race between Microsoft, Amazon, and Google turns into a real-estate and network-buildout competition, since whoever can place compute closest to players wins on the latency metric Curry identifies.
Third-order effects
- As cloud-native platforms like Stadia push new business models built on streamed play, the capital intensity of a data center arms race structurally favors the largest players — and, as developer Paolo Pedercini notes, shifts spending toward convenience that leaves users without ownership of the games they pay for.
The trend: Gaming is converting from a hardware business into an infrastructure business, where the location and density of data centers — not consoles or discs — set the ceiling on product quality.