Stadia to close first party studios

We’ve talked a lot about Stadia and how it seems to be perpetually “on the ropes.” Now, we have yet another piece of bad news from the streaming service, as Google has announced they will be closing down their first party studio.

“Given our focus on building on the proven technology of Stadia as well as deepening our business partnerships, we’ve decided that we will not be investing further in bringing exclusive content from our internal development team SG&E, beyond any near-term planned games,” the ad giant said in a press release.

They also announced that Jade Raymond had decided to leave Google to pursue other opportunities. Raymond had been made head of their Montreal based Stadia Games and Entertainment studio following a successful tenure at Ubisoft as producer on the Assassins’ Creed franchise.

Google has continued to pump up Stadia’s technology and recent success with Cyberpunk 2077, which ironically ran better on the streaming service that last gen consoles. The company has also reasserted plans to continue developing Stadia, and adding more third party releases down the road. However, gamers have yet to warm up to the concept.

Now, game streaming seems to be something the industry is eager to shove down our throats whether we want it or not. That’s a given at this point. They’ve never really liked the idea of people “owning” hardware and software. It’s more profitable to hold peoples’ content hostage behind paywalls in the form of monthly fees. Much like what has already happened with movies and music, or online modes in the case of video games.

Now, when you look at a services like Game Pass and xCloud from Microsoft, they don’t really try to hide the fact that they’re just a glorified rental services. All be it with curated content. However, the benefit for the end user is cost and quantity. For the price of two AAA games a year, you get an all-you-can-eat smorgasbord of entertainment. So if you buy a lot of new games, and aren’t particularly bothered with collecting, it can work out cheaper over time. If these services ever go down or get discontinued, you’re not out of pocket since you haven’t actually bought anything beyond access.

This isn’t the case with Stadia. You a monthly fee of $10 USD for “Pro” access (which I assume most actual gamers would want), then you are required to pay full retail price for each game you’d like to play on top of that. Access to those games, that you bought, can be taken away at any time, for any reason. That money you paid for them is just gone at that point. That, my friends, is a rather poor value proposition compared to the buffet model. Made all the worse when you actually do the math. Two years of Stadia costs nearly as much as a Nintendo Switch or Xbox Series S. Neither of which suffers from the technical limitations of streaming. Both companies are also heavily invested in their gaming products, so it’s unlikely online access to digital purchases will ever be completely lost. At least not anytime in the near future. Of course the Switch also has physical media which isn’t tied to online accounts. So those games will retain at least some of their value.

If I had to hedge my bets, the buffet style business model of xCloud is the one of the future. Much as it has been for movies and music. How often do you see people buying movies to stream anymore? Everyone just watches and listens to what’s free with Netflix, Spotify, or Disney+. The fact that Google is still treating Stadia as a side project also doesn’t inspire a lot of confidence in consumers. It’ll be interesting to see where they go from here, but this move reeks of what Sony did with the Vita. And we know nothing good came from that.