Microsoft Plans to Expand Xbox Cloud Gaming with PC Games, Revealed in FTC v. Microsoft Case

Revelations stemming from internal emails disclosed during the FTC v. Microsoft case have shed light on the tech giant’s plans to revolutionize its Xbox Cloud Gaming service. The company’s strategy includes incorporating PC games into the streaming platform, a move initially prompted by the presence of Google Stadia in the gaming sphere.

Xbox Cloud Gaming’s Current Reach At present, Xbox Cloud Gaming offers access to games through Xbox Game Pass across a range of devices, encompassing Xbox Series X|S, Xbox One, PC, and mobile and tablet devices compatible with Apple and Android. However, the service’s library has been limited to Xbox titles exclusively.

Behind-the-Scenes Conversations Internal emails exchanged in July 2021, involving key figures such as Microsoft CEO Satya Nadella, Xbox chief Phil Spencer, head of Cloud Gaming Kareem Choudhry, and head of Xbox creator experience Sarah Bond, provide insight into Microsoft’s forward-looking strategy.

During these discussions, Satya Nadella expressed concerns about Google Stadia’s competitive edge due to its use of generic Linux virtual machines and network infrastructure. He inquired whether Microsoft would implement a similar approach for Game Pass PC.

Phil Spencer affirmed that Microsoft was actively working on enabling the streaming of native PC games through the cloud. He also pointed out the potential for cost savings by reusing Azure GPU SKU for this purpose.

Kareem Choudhry provided further details, stating that a suitable Azure SKU was in development, aligning with the demand for Infrastructure as a Service (IAAS) and to support the Xbox Cloud PC streaming stack.

Competition and Surprises The move to expand Xbox Cloud Gaming’s offerings with native PC games was evidently a response to the competitive landscape. Spencer noted that Google was transitioning Stadia into a Google Cloud SKU while discontinuing its first-party consumer service.

Despite acknowledging Google as a “massive and aggressive competitor,” Spencer expressed surprise at the lack of progress with Stadia. He also identified Nvidia’s GeForce Now as the top competitor to Xbox Cloud Gaming, while keeping a watchful eye on Google and Amazon’s Luna.

Awaiting Official Confirmation Although the internal emails offer a glimpse into Microsoft’s plans to introduce native PC games to its cloud gaming service, there has been no official statement from the company regarding this development.