Cloud gaming uses remote servers to stream video games directly to the player. This allows the user to play the game remotely on their choice of computer or mobile device, so long as they have a strong, stable internet connection to stream games properly. Players could pay a subscription fee to access games that previously required a $300 PlayStation 4.
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Totoki said he thinks it will be some time before the video game industry can fully adopt a cloud-based model. He said cloud gaming would take a significant amount of time to implement, and digital content stores like the PlayStation Network would need to renegotiate rates for distribution.
"For example, take an extreme example, people not be using hardware," Totoki said on Sony's recent earnings call with analysts. "Hardware will become unnecessary, some would argue. But on this point, I think that would take a much the longer the time required for games going to the cloud, it would take much long time, much overtime and also the platforms trying to reduce the revenue share percentage."