updated 03:40 pm EDT, Mon June 18, 2012
Streaming service seen as considerable threat to console industry
Microsoft appears to have recognized the potential impact of the game streaming service OnLive, and may have eyed the company as a potential acquisition to help cement the Xbox console's future in the cloud gaming era. The revelation was buried in a recently revealed (and then rapidly removed) 56-page document purporting to lay out Microsoft's plans for a new Xbox due next year.
According to notes on the now-removed document, OnLive's streaming games service struck Microsoft as a potential "threat" to the Xbox 720. OnLive's cloud-based game service allows users to connect to and play console games through Internet-enabled computers and tablets, essentially eliminating the need for a console. The purported Microsoft document claimed that OnLive could "up-end the console gaming market" by making high-end user hardware obsolete.
Due to the potentially disruptive nature of the service, Microsoft appears to have labeled OnLive a "potential acquisition target." The leaked presentation, though, appears to date from August of 2010, and the tech landscape has shifted considerably since then. Connection quality parity continues to constitute a significant barrier to cloud gaming adoption, limiting the overall attractiveness of such services. Still, video game companies such as Sony have recently noted that cloud services appear to be an inevitable trend.