Last week, Microsoft and Sony announced a strategic partnership that includes the use of Azure as a backend for future cloud gaming services as well as semiconductors and AI solutions. The deal surprised many in the industry as the two companies have been fierce competitors in the gaming space for almost two decades.
According to a new report from Bloomberg, employees of Sony’s PlayStation division were among those stunned by the announcement. People familiar with the matter say that most of the staff at the gaming division were unaware of the upcoming partnership, as the talks with Microsoft were handled directly by Sony’s senior management in Japan.
The two tech giants began negotiations last year after talks between Sony and Amazon for a collaboration on cloud gaming failed, as they couldn’t agree on commercial terms. The PlayStation Network, Sony’s online game service is currently hosted by Amazon Web Services. The breakdown in talks with Amazon led to Sony’s discussions with Microsoft.
With game streaming set to become a key component of the gaming market in the future, everyone seems to be gearing up for the upcoming cloud streaming wars. Responding to the announcement of Google’s Stadia game streaming service, Xbox head Phil Spencer promised to "go big" at this year’s E3 event with Project xCloud, Microsoft’s own take on game streaming. Amazon is also expected to enter that fight and rumors are surfacing on Twitter by an industry analyst that Nintendo is also looking to use Azure for its own streaming service. However, you should take that last bit of news with a grain of salt, because it hasn’t been corroborated by anyone else yet.