Cloud gaming has officially entered the big time, with Nvidia partner Gaikai becoming a wholly-owned subsidiary of Sony Computer Entertainment.
The deal, which sees Sony splash out $380 million for Dave Perry's four-year cloud gaming startup, comes hot on the heels of Gaikai's partnership with Nvidia for the Nvidia GRID and rumours that Sony's next-generation PlayStation 4 console would make use of cloud-gaming capabilities.
The explosion of interest in cloud gaming has been helped by the spreading of broadband internet connectivity. With a fast enough connection, it becomes possible to farm out the heavy lifting parts of running a game - 3D rendering and physics calculations, for example - to remote server farms, which then digitise the video stream and send it back to the user.
The result: the ability to run console-quality games on cut-price hardware. Cloud gaming pioneer OnLive sells its micro-console device for the fraction of the cost of a high-end graphics card, yet allows full access to an impressive selection of the latest PC games which run with the graphical settings cranked way up. Perry's Gaikai, by contrast, has shied away from the hardware front in favour of partnerships with companies including Samsung, to put the technology into Smart TVs for console-free gaming, and Facebook, for in-browser use.
Cloud gaming isn't without its issues, however. Users on slower internet connections will find their enjoyment curtailed by poor response times and heavily compressed video streams, while even those with high-performance connections report that the graphical quality does suffer somewhat compared to traditional local rendering.
There are plenty of companies and consumers who find the advantages outweighing the disadvantages. Unlike a traditional digital distribution system, there's no delay while you wait for the title to download - which makes the platform great for demos, with players able to instantly try as many new games as they desire.
Sony's purchase of Gaikai shows that one of the world's biggest gaming and consumer electronics giants is taking the technology seriously, and while neither company are stating their joint plans outright it seems easy to predict how things are going to go. First, Gaikai will be added to Sony's range of consumer electronics products, potentially including the recently-announced Google TV-based set-top box and internet-connected Blu-ray player. Combined with a USB- or Bluetooth-connected controller, gamers will be able to access the full Gaikai service.
In the slightly longer term, it seems likely that Gaikai will be added to the company's PlayStation brand. It should, theoretically, be possible for Sony to add a Gaikai client to the PlayStation 3 and PlayStation Vita consoles - but it's the PlayStation 4 which stands to benefit the most.
For the past few years, rumours have been circulating about Sony's next-generation console and the techniques the company will be introducing to curtail piracy and the loss of profit that comes with second-hand sales. Some rumours claimed that the device would ship without an optical drive - with the same being claimed of Microsoft's next-generation Xbox console, too - with games being available only for download.
The size of current-generation games - which can span multiple double-layer DVDs - and the slow internet connections still enjoyed by the majority of consumers put paid to that rumour, but the acquisition of Gaikai could change all that: if the games are streamed rather than downloaded, users wouldn't need to wait for tens of gigabytes of data to be downloaded yet Sony would still have killed both piracy and second-hand sales in a stroke.
This, however, is just speculation. Sony has stated that it will be using Gaikai to produce an own-brand cloud gaming service, but has shied away from announcing exactly what platforms it will be targeting.
'By combining Gaikai's resources including its technological strength and engineering talent with Sony Computer Entertainment's [SCE's] extensive game platform knowledge and experience, SCE will provide users with unparalleled cloud entertainment experiences,' claimed Andrew House, SCE president, at the announcement. '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.'
Although cloud gaming may be a tough sell for all but the most budget-restricted PC gamer, Sony is likely to have better luck in the console world where a remote render farm would give players the ability to experience the kind of complex world and highly detailed graphics for which PC gaming is rightly renowned.