Sony, Microsoft form unlikely cloud gaming partnership

Kenichiro Yoshida, president and CEO of Sony Corporation (Left) and Satya Nadella, CEO of Microsoft. (Sony/Microsoft)

The makers of PlayStation and Xbox, heated rivals in the video game console market, are forming an unlikely alliance to explore cloud gaming and artificial intelligence.

Sony and Microsoft this week jointly announced an agreement to work together on developing cloud technologies based on Microsoft Azure. The companies are focused on improving their respective video game and content streaming services. Sony also plans to look into using current Microsoft Azure data centers for its services.

"PlayStation itself came about through the integration of creativity and technology. Our mission is to seamlessly evolve this platform as one that continues to deliver the best and most immersive entertainment experiences, together with a cloud environment that ensures the best possible experience, anytime, anywhere,” said Kenichiro Yoshida, president and CEO of Sony, in a statement. “For many years, Microsoft has been a key business partner for us, though of course the two companies have also been competing in some areas. I believe that our joint development of future cloud solutions will contribute greatly to the advancement of interactive content.”

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"Sony has always been a leader in both entertainment and technology, and the collaboration we announced today builds on this history of innovation," said Satya Nadella, CEO of Microsoft, in a statement. "Our partnership brings the power of Azure and Azure AI to Sony to deliver new gaming and entertainment experiences for customers."

Besides Google, which announced its cloud gaming service Stadia earlier this year, Microsoft may be the furthest along toward a new commercial cloud gaming launch.  Last year, Microsoft announced Project xCloud, a video game streaming service, with plans for public trials to begin in 2019. The service will work on PCs and mobile devices—along with consoles—and will allow users to play with a Bluetooth controller or on-screen controls.

In March, Microsoft showed off a live demo of xCloud. Kareem Choudhry, head of gaming cloud at Xbox, said the service would work anywhere that Microsoft has a client and where a good network connection is available. He said xCloud would use a lot of same Xbox Live features like cloud saves, friends networks, identities and accounts.

“It’s the same experience just translated to a different form factor,” Choudhry said.

It’s entirely plausible that Sony wants to hitch its PlayStation ecosystem to the xCloud train. Of course, Sony has already offered its own cloud gaming service, PlayStation Now, for years.

Microsoft and Sony also said they will collaborate on AI and semiconductor solutions, including new intelligent image sensor solutions.