51w ago - Update: It's now confirmed that Sony has acquired Gaikai for $380 million with the official press release below.
Press Release: Sony Computer Entertainment to Acquire Gaikai Inc., a Leading Interactive Cloud Gaming Company
SCE to Build a Cloud Service Bringing Gaikai's Cloud Based-Streaming Technologies into Its Network Business
TOKYO, July 2, 2012 PRNewswire - Sony Computer Entertainment (SCE) today announced that it entered into a definitive agreement on June 30, 2012 (Japan Time) to acquire Gaikai Inc., the world's leading interactive cloud-based gaming company, for approximately USD 380 million.
Through the acquisition, SCE will establish a new cloud service, ensuring that it continues to provide users with truly innovative and immersive interactive entertainment experiences.
"By combining Gaikai's resources including its technological strength and engineering talent with SCE's extensive game platform knowledge and experience, SCE will provide users with unparalleled cloud entertainment experiences," said Andrew House, President and Group CEO of Sony Computer Entertainment Inc.
"SCE will deliver a world-class cloud-streaming service that allows users to instantly enjoy a broad array of content ranging from immersive core games with rich graphics to casual content anytime, anywhere on a variety of internet-connected devices."
"SCE has built an incredible brand with PlayStation and has earned the respect of countless millions of gamers worldwide," said David Perry, CEO of Gaikai Inc.
"We're honored to be able to help SCE rapidly harness the power of the interactive cloud and to continue to grow their ecosystem, to empower developers with new capabilities, to dramatically improve the reach of exciting content and to bring breathtaking new experiences to users worldwide."
Established in 2008 and headquartered in Aliso Viejo, California, Gaikai has developed the highest quality, fastest interactive cloud-streaming platform in the world that enables the streaming of quality games to a wide variety of devices via the Internet.
With this acquisition, SCE will establish a cloud service and expand its network business by taking full advantage of Gaikai's revolutionary technology and infrastructure including data centers servicing dozens of countries and key partners around the world.
The transaction is subject to certain regulatory approvals and customary closing conditions.
SCE will continue to aggressively expand a new world of entertainment through the introduction of innovative technologies and the delivery of amazing experiences.
Following up on our previous article, today a new rumor from GamesIndustry.biz (linked above) speculates that Sony may be bringing backwards compatibility of PS2 and PSOne titles to modern-day PlayStation (PS3, PS Vita, etc) devices with the supposed Gaikai cloud gaming deal set to be unveiled at E3 2012.
To quote: "Sony's rumoured cloud gaming deal with Gaikai is to allow current-generation hardware to play PlayStation 2 and PSOne games via a streaming solution, GamesIndustry International understands.
According to sources, the service will offer first-party games and be open to third-party publishers to sell back catalogue to players. The partnership is likely to be announced at E3 next week as part of Sony's conference on Monday.
Gaikai already has an extensive portfolio of video game partners that have been on board with CEO David Perry's vision since the service first went live, including Electronic Arts, Ubisoft and Capcom, but all titles so far have been for the PC format.
The appetite for PlayStation 2 games has been proven with collected HD releases of titles including Silent Hill, God of War, Devil May Cry and Ico and Shadow of the Colossus.
The streaming games company has also signed up retailers like GAME and Best Buy, services such as YouTube, TV manufacturer LG and social network Facebook, and is expected to announce further partnerships next week.
It's not yet clear which Sony devices beyond the PlayStation 3 would get a Gaikai-supported game streaming service, but it could extend to Sony branded TVs and tablets.
A backwards compatibility offering at this stage in the PS3's lifecycle would also allow Sony to test streaming games before it goes fully next-gen with the release of the PlayStation 4."
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Following up on our previous article, today MCVUK (linked above) reports that according to their sources Sony is indeed close to acquiring a high-profile cloud gaming firm.
To quote: "In a move that will rock the next generation of console gaming, Sony is close to agreeing an acquisition of a high profile cloud gaming firm, MCV understands.
It was reported earlier this week that Sony was to reveal a partnership with a cloud gaming firm - specifically either OnLive or Gaikai - at E3 next week.
Subsequent chatter had seemingly calmed the rumours, suggesting that the proposed agreement was to do with Sony streaming TV services, and not consoles.
However, MCV understands that the deal is far more extensive than anyone could have predicted and will see Sony fully acquire one of the two firms. The deal, our source says, "is close to being signed".
The acquisition has implications for all parts of Sony's business, both in the consumer tech and console divisions.
Although work on PS4 is already well underway, Sony is very likely keen on bringing its PlayStation gaming content to non-console owners - a move finally made possible by this deal.
And there could be benefits for console users, too, with gaming content likely to be available when on the move and without the need for a direct connection to the console.
If nothing else, the deal should hit home the fact that the digital gaming revolution is not a distant dream - it's happening. Now. And the implications for games retail are both obvious and colossal."
Diablo 3 is partially a cloud based game. All the content is not installed to your computer, some is only on Blizzard's servers in order to prevent cheating/hacks which would directly be about items. Blizzard are doing everything in their power to prevent such a thing from happening since they are relying on the Real Money Auction House's success in order to make absurd profit.
That could be destroyed if the items/economy was tampered with like it was in Diablo 2. The entire game is basically built around the RMAH, even at the cost of the quality of the game. It's for this reason there are no trade channels, they don't want people to be able to trade directly and avoid their Auction House fee which (if it's the same as the in-game Gold AH fee) is a whopping 15%. That's robbery, I don't use Ebay but I can't imagine them charging 15% on every transaction.
I wouldn't be surprised if they actually make more profit from this system than monthly fees like in WoW. Either way I can't imagine it lasting long if they don't revamp the entire game, the flaws and poor programming in the game are endless. There are more sacrifices of quality in order to be built around the RMAH such as the obvious lack of offline play, etc.
People are even speculating that the Auction House does not show an ID or name of any sort in order to make it easier for Blizzard to just conjure up super rare items and sell them there. I would be surprised if they didn't do this.
Unfortunately from how things look the cloud is the future of gaming. I for one won't buy into it. Sure the cloud has its advantages but none of which I really care for, but the disadvantages turn me off.
No offline play: my PS3 is offline 90% of the time, the other 10% is used mostly for trophy syncing, some multilayer, updates, and sending/receiving messages. No interest in an always-on game system.
Internet Connection Required at all times: sorry but I have had some issues with downtimes from every ISP I had. Couple that with power grid issues, and you will twice as likely encounter downtime.
If the service goes, everything, and all your investment, goes with it. Not interested in the risk. Sorry.
But it WILL be the future of gaming whether some of us want it or not. The mainstream market embraced digital with the iTunes music, despite having less sound quality than the CD, and DRM-laden Digital Distribution on PC is at its strongest. Steam is popular, but it is also DRM no matter how you spin it. Online passes also didn't stop games from selling millions, and there is no shortage of gamers defending the rumored anti-used games technology in the PS4 and Xbox720.
The truth is, the games industry would love us to be able to play their games without actually possessing them, for consumer control and copyright protection purposes. The cloud is the only way for publishers to really achieve that goal, and you bet it is going to happen. The consumer is willing to let it happen.
I think the fact that you're device is effectively a thin client and doesn't actually do any processing except for displaying streamed output and sending your input would be a good enough reason
It's not like the Assassin's Creed DRM which required you to be online to play... you're connecting to a server which is doing all the processing for you. So OnLive and GaiKai would never be able to allow you to play a game while offline and then sync your data.
Yeah that isn't the case anymore: it's free to sign up and you either rent/buy the games as one-off payments or pay a set monthly fee to play as many games as you want at no extra cost.
Also, YMMV with regards to latency etc. (and that is why I tend to stay away from FPS games with OnLive) but I find the lag to be negligible in games such as Batman:AA... However I do have a 60Mb internet connection
I've been thinking more and more about how this "popular cloud service" could logically be Steam instead of OnLive etc. Portal 2 already has the integration, PlayStation Plus has the cloud save feature (although I don't know anyone who actually has a P+ subscription!), the Steam store has a nice mix of casual "PlayStation-Mini" style games for the Vita and Hardcore for the PS3, and it would tie in with the PS3-Vita Transfarring or Remote Play abilities nicely.