There are 7 point 5 billion people in the world and over a quarter of those that's about 2 billion people play video games.
We game on our phones, our tablets, traditional consoles, and even old fashioned PC gaming has never been more popular than it is now.
But games are also really expensive.
Until now if you wanted to play the best games in the world, you needed to invest real money into serious hardware standard consoles cost a few hundred bucks.
And while some graphics cards are so powerful that they can run full artificial intelligence systems, they're also more expensive than a lot of computers.
So at 2020 we are now at the dawn of the next generation of gaming major firms that's Nintendo, Sony, Microsoft and others are preparing for new consoles.
The next big platform might not be a box Or a plastic disc or even a download, It might be up in the clouds and at a pretty low cost.
Okay, that's kind of exciting.
But now what?
Here to help us understand the future of gaming is Kareem Choudry is the corporate vice president of gaming cloud at Microsoft cream.
Has helped oversee the development and launch of Project xCloud.
That's Microsoft's cloud gaming technology that recently merged with their game pass subscription.
So, Korean let's start with the tech.
There's kind of a confluence of interesting technologies here and products.
So if you are not familiar with Azure or gamepass, or xCloud Let's start at the beginning help us understand what's happening here inside the gamepass ecosystem and how these technologies kind of come together.
Game passes are offering to bring together a curated catalogue of over 100 games that people can just play and enjoy where for one low monthly price per month.
They get access to a huge amount of games.
Now those games are playable natively on their PC and on their console.
And as you pointed out, not everybody necessarily has a PC or console, or sometimes they're away from it.
So what we're trying to do with the cloud is really deliver on that vision of playing the games you want with the people you want, anywhere you want, and enable our fans to play games from the cloud just as they would natively on their console on PC.
So my home PC is a potato.
It was built in 2014.
I do not have an expensive graphics card and yet, last night I was able to stream Some of the most beautiful looking games I've ever played on a PC, how is the technology able to deliver a high quality?
I mean incredibly high resolution graphics at such low latency what's happening behind the scenes?
There's a bunch of things that are coming together.
The first thing is the fact that you know, like, Xbox is a part of Microsoft and Microsoft has, you know, the entire Azure Data Centre infrastructure of over 60 regions.
So, step one of what we're doing is that we're actually deploying hardware as opposed to consumers as possible.
And then the next thing we're doing is that we're taking that that console hardware that we've delivered into homes for many, many generations and many years.
We've made a server, a server farm version of it.
we're deploying it into the data centers.
And so the experience that you get to have in your home is really like playing over a console the data center with a really long HDMI cable Okay, so it feels like I'm playing with a really long HDMI cable until my connection drops.
So last night the exact same thing happened I was in the middle of a fantastic gaming session but my internet connection dropped.
Help me understand the contingency plans.
If, I'm on kind of a shaky connection or it's just not a fast connection.
Is this a solution that works for me?>> I think what we're trying to do today is the first thing we're doing is we're making sure that our big Bandwidth requirements are as low as possible.
So we're trying to fit within the envelope that's required for just streaming video, which most of the world is pretty familiar with today.
At the same time, if your particular internet connection at your home happens to have a drop.
We actually keep your session alive back in the server.
So when you reconnect, you don't miss a beat.
Now I pay for this service I'm not saying this as any type of paid anything.
Game pass is generally considered one of the best subscription services that you can pay for in gaming, at least, the value to the cost, but it hasn't always been that way.
It launched in 2017.
It's kind of been slow incremental progress.
So I wonder if you can kind of help us understand the parallel paths that have happened here with both game passes evolution, as well as the x cloud evolution.
The vision of game pass of creating a curated library and enabling people to jump in and play.
That's been around for a long time and now I'm incredibly excited on September 15.
You know, for the first time, you know you're going to be able to play when you're away from your console or PC so much like how I consume music, how I consume linear video, you know, 10 years ago, what music I listened to was defined by what device I had in my hands or right in front of me.
But now when it comes to listening to music, you know, Spotify or other services doesn't matter what device I have, I get to listen to whatever I want.
Same thing has happened with video.
If you had told me six years ago that my kids would watch an entire season of Stranger things on their phones, I'd say You're crazy.
That's never gonna happen.
But you know technology's moved and now it's gaming time.
So when you as a gamer want to play it on your console, play on your PC, play on your phone, play on your tablet, Switch between them all.
We've linked those ecosystems all together.
So you're not having to kind of slice between separate worlds, your saved games, your friends, your achievements, your history is all connected and part of the Xbox ecosystem.
That's the vision.
We're trying to deliver.
On September 15, we're really kind of starting on that, you know, cloud based augmentation of what we're already doing and we're just gonna grow from there.
I'm glad you mentioned those other mediums, music and movies.
Gaming is more complex, but it has a lot of similarities.
Help us understand some challenges that were unique to gaming in game streaming or cloud gaming,that might not have been present in those other mediums.>> Yeah, that's a great topic dance.
So both music and video,they're standing, They're produced once and then everybody consumes that same experience.
Whereas gaming that is a real time endeavor, you're providing input.
The game is reacting multiplayer scenarios, you've got players on the other side of the server that reacting.
So all that needs to be a very, very real time.
I've been working in gaming for 20 years.
So thinking about input latency thinking about multiplayer latency, that's something we've been doing on the console on PC the entire time.
So we've applied all that knowledge and know how to think about okay, how do we run a game completely in the cloud?
Remote that experience in a way that it meets consumers expectations but not only that, it captures the creative vision of the publishers and developers as well.
The the real time aspect of it has been a real technical challenge.
We've used the Azure networking infrastructure in our partnerships with mobile operators and telcos all over the world.
Just to try to ensure that that network routing from an Azure Data Center through a mobile operator or a telco through the infrastructure or 3d at last mile, all the way to the consumer wherever they happen to be is, you know, an optimal routing.
So on that topic I know that you've partnered with razor a bit do and others on not just the software and not just the cloud but on hardware technology helped me understand a little bit about the products that are happening there.
We thinking a lot about input, we're taking games that were designed for the console for a controller in your hand and we're putting it on a mobile phone.
And obviously you can connect your you can pick your controller, but we're also thinking about the form factors and convenience.
Our goal is really centered on the player and their experience.
So we're spending time thinking about how can we make as ideal as possible for them.
We only partner with a company like razor, who've developed the razor Kishi, which is this phenomenal mobile controller which you can put on both sides of your phone is very portable.
It's a fantastic experience.
And, again, this kind of comes back to choice.
So I'm happy for people to play with an Xbox controller.
Happy for people to play with a razor Kishi or any of the other controllers that you mentioned Really any high quality controller that is supported you know by Android will work with will even work with a PlayStation controller.
It's about getting people into the game.
So I know that being able to play on no matter what device I have is incredibly important.
But One of the touch devices that is one of the largest platforms in the world has been kind of cantankerous, at least in this interaction.
I'm not asking you to speak for Apple, but help me understand why I can't if I'm a consumer, why can't I play x cloud on my Apple device?
You know, with what we're trying to do with Xbox game pass, we have a vision.
And an experience that we're delivering is that we want people to have access to a catalogue of games that are playable from the cloud as part of their membership and Xbox game, pass and We've worked with Apple for a few years on trying to bring that experience to their platforms.
We're going to continue working with them.
You know, it's unfortunate that we haven't been able to come to a solution yet, but, you know, we have our point of view on what we're trying to do we hear what our fans are asking for, and we're just gonna have to continue making progress.
Let's talk about the Xbox itself the actual hardware.
Now look, Microsoft is a company that makes software for hardware and you make hardware with your own software on it and yet, game pass.
You seem to not care what hardware I'm playing on.
So help me understand the strategy here and help me understand how you work with the actual Xbox unit.
Do you not care about selling Xbox units?
Of course we care about selling Xbox units.
You know, I get a lot of questions that kind of take that form of, well now you're doing this instead of this and that's not how we think about it all.
This is an ad strategy.
I love what we're doing in console I've been working on a console for years we're launching the world's most powerful console this holiday Don't know anything more than we could do to say that we care about console.
We're also the stewards of gaming on PC continuing to invest in everything that we're doing there.
So really this is about getting people into the games and.
We don't want to tell people how they should game.
It's not for us to say gaming this way is good and gaming this way is bad.
I'm gonna enable you to get into the game whatever way you want, and players get to choose what they want to do.
So play on PC, play on console, play via the cloud, play via all three.
It's really kind of up to you.
I just want you to play.
So the last question for you.
the competitive landscape is getting really interesting right now.
Amazon, of course is well known for the cloud.
Google is in the very similar game with stadia.
Of course Nvidia has a fairly similar product with GeForce Now.
You map out the next 18 to 36 months for me, I think as a consumer, it's going to be very exciting.
But tell me the competitive landscape for you, How will it shift?
and how are you going to battle with all of these pretty powerful and interesting competitors?
Well, you can see our strategy in what we're doing.
And our belief over at Xbox is that to be successful on a global scale and what gaming is and will become, you really need three things.
We call those our three C's.
And that's content and community and cloud.
You can think about Microsoft, you know, we've been investing in content for 20 plus years.
We've got 15 first party studios with franchises ranging from Minecraft to Halo to gear support stuff.
We just launched flight simulator a couple weeks ago.
Tell me why from don't nod, you know, grounded like.
Content is what drives this industry.
Yes there's a lot of technology but this is an entertainment business.
So if you look at our investments in content, how we've partnered with the entire industry for years and years like we know how to bring that content together.
Next see is community like we have Xbox Live with over 90 million users a month bringing people together.
You know, gaming is a social activity.
It's uniting the world.
It's never been more important than now during these times open 19.
So we're bringing people together with our community, combining it with our content.
And then we're unifying all that with our cloud.
Like we have the first party cloud and Microsoft Azure.
The synergy there, how we can bring things together.
You know, it's the combining of the three C's to be to give people the most choice, the most flexibility and the best possible offering and that's about the experiences they get to play where they get to play them, how they get to play them, who they get to play in with.
We're gonna bring it all together in the best way that we can Fantastic.
I actually have one last question, but that's just Can you make some news and tell us when the next Xbox is coming out what the price is going to be?
And will there be a digital unit to?
I'm not going to get into that and you know, stay tuned, we'll have news to share.
Obviously the team is hard at work on Xbox series x and all will be revealed in due time.
All right, thank you very much cream choudry is Microsoft's corporate vice president of Project X cloud which has recently merged with game pass.
You can learn more about the next console war, including the Xbox series s and series x by visiting cnet.com for CNET.
My name is Dan Patterson.