How 5G companies became the competitors of Cloud Gaming Companies?

Have you been busy building fantastic games and are unaware of all the recent happenings in the industry? By recent happenings, I mean the increased involvement of telecom companies in the cloud gaming domain?

That’s right, chances are you could be losing your revenue to the telecom companies in the coming time. 

How is that possible? 

Well, have you ever thought of the licensing fee you’ll need to pay to telecom companies to use their 5G infrastructure? Not just that, did you know telecom companies are actively working to improve specific aspects of cloud gaming and are standardizing it

Yes, you have competition from the telecom industry and you didn’t even know about it because it was not strikingly visible.  However, there’s still time and you can strategize around this with ample information. 

Want help with the deets? Scroll down and you will find everything you need to know about the involvement of telecom companies in the cloud gaming domain. 

What is the current ecosystem of the gaming industry like?

There is a radical difference in the Gaming Industry now from what it was a few years ago. Video game cartridges have been replaced by digital disks on most gaming consoles. Downloading/buying a digital copy of a video game is still in trend, however, many companies have launched their cloud gaming services that provide high speed and low latency gaming experience to the users at the price of ownership of the digital copy of the game.

For the uninitiated – If I try to define cloud gaming as I know it – it enables customers to play video games by utilizing hardware present at a remote location and owned by individual companies. Instead of downloading a game on our system or installing a game using digital disks, cloud gaming depends upon internet speed to deliver games on the subscribed devices from the remote servers.

In the last decade, many companies have been making promises of a better, fast and smooth gaming experience for gamers. They planted the seed of high-speed online gaming at least in my head as they showcased underdevelopment prototypes like Google Stadia, Project Xcloud, and many more. As I remember, when Google introduced Stadia, their vision was “one place for all the games you play”.

That dream has shaped today’s reality. There are multiple cloud gaming platforms like Shadow, Vortex, GeForce Now, etc. available for the gamers on which they can run high-end games with top-notch graphics in their low-end devices with minimum latency.

According to analyst firm IHS Markit, it is predicted that the cloud-based gaming market will be worth $2.5 billion by 2023. This predicted growth and change in trends is perhaps attracting telecom giants to invest in cloud gaming. 

In fact, many Telecom giants are forming alliances to get maximum returns from the gaming market. Below, we have highlighted some of the recent developments –

  • Huawei Technologies Co and NetEase are to establish a cloud-based gaming lab running on the 5G network.
  • China Mobile and ZTE’s 5G MEC-based cloud game innovation where cloud games are distributed from Tencent Cloud to the local MEC (Multi-Access Edge Computing) in China Mobile’s 5G network.
  • Sony and Microsoft, the makers of PlayStation and Xbox and heated rivals,  are forming an unlikely alliance to explore cloud gaming and artificial intelligence.
  • NVIDIA is working on Project Shield, an Android-powered handheld game console with the ability to stream PC games.
  • NGMN (Next Generation Mobile Networks) Alliance is a mobile telecommunications association of mobile operators, vendors, manufacturers, and research institutes. NGMN is a standard-setting organization that sets standards for the mobile operators to provide 5G services including cloud gaming to the users. They published a white paper discussing the 5G requirements for providing different end-to-end services. Some of the major members of NGMN are – AT&T, NTT Docomo, Vodafone, and Singtel. 

Now that we had a look at some of the major alliances, in the next part of this article, we will talk about how 5G is shaping the gaming industry. Here’s a brief overview of what you can expect to read next in the coming sections of this article. 

  • First, we will discuss quick insights from 3gpp. Is 3gpp talking about cloud gaming? Which companies are filing cloud gaming patents in 3gpp? 

[Note: Getting insights from 3gpp isn’t everybody’s cup of tea because the information is scattered. You need to be aware of the tricks to get those insights and we are eager to help!]

  • Then, we will pick up the patent front and see how things are evolving. Which companies are camping on getting increased gaming revenues in the coming years?

What role will 5G play in cloud gaming?

High-speed internet connectivity with low latency (aka ‘Need For Speed’) is the most important requirement of cloud gaming to provide ‘gaming on the go’ to the die heart gamers so that they can access gaming at any time, on any device and in any place. The standalone 5G networks thus are the perfect contender for providing high-speed internet connectivity with low latency due to its adaptive network architecture like network slicing and enormous bandwidth.

Networking slicing in 5G Networks (like in Fruit Ninja) has the potential to guarantee and prioritize a ‘Cloud Game’ slice providing resources for gaming services to ensure high experience quality of the cloud game.

(Side Note: This short and informative article from Forbes discusses the importance of 5G in cloud gaming. It majorly highlights latency as the major issue to be tackled, and proposes 5G techniques like edge computing, network slicing as a solution to this).

What’s 3GPP talking about?

The process of standardizing the 5G concepts for providing cloud gaming services by the 3GPP is in full swing. At GreyB, we have our in-house search and analysis toolNPLSE, using which we could easily track at what stage ‘cloud gaming’ is? Upon digging, we found that there is an ample amount of contributions made in the standard-setting organization.

The below graph showcases a timeline evolution of contributions made in 3GPP for the cloud gaming aspect using 5G.  It depicts the trends of the effort made towards standardizing cloud gaming aspects by different companies.

Source: NPLSE GreyB Services

Among all the telecommunication giants, Huawei, China Telecom, China Mobile, China Unicom, OPPO, ZTE, Samsung, Xiaomi, Broadcom, Vivo, AT&T, KT (Korea Telecom), Verizon UK LTD have submitted a major portion of these contributions.

These giants are dedicatedly working on 5G system enhancement for Cloud services. S2-1906507 & S2-1906718 are a couple of examples of their contributions

If we look at them closely, they are focused on improving latency/data rate, which are the basic KPIs of 5G. The main focus here is on improving the cloud gaming architecture. Needless to say, major improvements are needed on the network side.

Although a dedicated 5G specification for cloud gaming has not been developed as of now, several TRs (Technical Reports) are related to cloud gaming. These TRs may be seen as reports summarizing the progress made for various discussions happening in 3GPP meetings. Their content can very well be considered as potential content to be included in 3GPP specifications going further.

I have shared some screenshots from these TRs below –

TR 26.925

TR 22.842

TR 26.928

What do the Patent Filings suggest?

We have always emphasized that to figure out a firm’s upcoming strategy, you have to explore their recent patent filings. Filing patents to protect their tech, after all, is the most important and major step companies take to secure their big innovations. 

While looking for the patent literature focused on Cloud gaming using 5G, we found some interesting patents/applications which we have listed below.  

  • WO2017098810A1, filed by Sony, claims a core network process to provide services like cloud gaming to the users.
  • US10194448B2, filed by Vodafone, claims a cloud streaming process to provide cloud services like cloud gaming to users.
  • CN110933036A, filed by China Mobile, discusses a cloud game service system deployed on an edge server.

Looking at the developments being made in this direction, 5G looks like a potential hot technology for the big players in the gaming industry to watch out for.

Patent Filing trends

Next, we have gathered some insights on the top patent filers for using 5G techniques in the enhancement of “cloud” or directly, “gaming” infrastructure. Here’s what we got:

Who are the Major Players?top 5g cloud gaming companies patents

Qualcomm leading the count is not a surprise as the company is leading in the 5G chipset market. As smartphones are one of the reasons the cloud gaming market is getting a boost, Qualcomm, a leading chipset company, is able to get the opportunity to take a chunk of the market with its Snapdragon Processors.

Ericsson, Intel, Samsung, and Huawei in the top 5 do not come as a surprise as these companies are market leaders in providing telecommunication infrastructure.

Sony, a gaming company, is able to make a place in the top 10 list, despite not being as big a participant in 5G standard development. 

As you can see, the top list is flooded by 5g companies whether they provide network infrastructure or processors for gaming devices.

Further, the below trend shows a huge number of patents filed in the cloud gaming domain from late 2012 onwards – the era when 5G development began to shift gears.

Priority year-wise distribution

Chart Source: Derwent Innovation

Concluding remarks

After having a look at the patent filing trends and the ongoing 3GPP activities, it seems clear that ‘5G ’ is the future of the gaming industry. 

Telecommunication giants are working with full force to standardize various concepts of Cloud gaming in 5G. It is high time for gaming companies to start R&D in 5G/cloud communication, or form alliances with Telecom companies to stay ahead of the competition. 

A competitive analysis of at what stage your competitors are, in terms of owning 5G IP could prove crucial. Want a hand with the analysis?

Get in touch

Authored by: Nripdeep Singh and Ankush Sharma (Lead, Search Team). 

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