Via Financial Times

Nvidia, whose chips are used in many of the world’s most powerful gaming PCs, has formally launched a streaming service for gamers, joining a race among some of the most powerful technology, internet and gaming companies to dominate the emerging market for cloud-based play.

The US chipmaker said it would offer a free service for gamers who were prepared to wait for access to its servers at busy times, along with a low-priced introductory offer of $4.99 a month for guaranteed service and a chance to play games with more advanced graphics.

Executives likened the service to Spotify, whose “freemium” streaming music service set a new model for the music industry. 

Nvidia had already been operating a trial streaming service with 300,000 users, all of whom will be automatically switched over to become free users in the new GeForce Now.

The company said it was doubling capacity in its network in anticipation of a wave of new users, who would have free access for sessions of up to an hour at a time, provided there was spare capacity on Nvidia’s servers. 

The move comes just three months after Google formally launched its own attack on the gaming market with a streaming service called Stadia. That service has received mixed reviews in its early days, given the scarcity of hit games and Google’s slow introduction of distinctive new technology features, such as integrating it with its YouTube video service. 

Unlike Google, Nvidia only provides the network and datacentres to support online play, enabling people to access games they already own or other gaming platforms that are linked to GeForce Now.

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This “bring your own licence” model contrasts with full content services like Stadia, as well as networks linked to the Xbox and Sony games consoles.

Nvidia starts out with a strong position among serious gamers, thanks to the popularity of its high-end GeForce graphics processing units, or GPUs, said Patrick Moorhead, an analyst at Moor Insights & Strategy.

Offering access to its most powerful GPUs online would expand the market by letting many more people play the most sophisticated games without having to pay $500 or more for a specialised graphics card for their own PCs, he added. 

The move represents both a hedge against the risk that Nvidia’s PC chips business would be disrupted by cloud-based gaming, as well as a potential way to open up a big new market for the company, according to Piers Harding-Rolls, an analyst at IHS Markit.

Cloud-based gaming had given companies like Nvidia a chance to expand their place in the gaming value chain, Mr Harding-Rolls added. 

Nvidia said its cloud infrastructure, based on nine datacentres in North America and six in western Europe, meant it could stream high-definition games to households with broadband connections in those areas with lags of only 20 milliseconds. Through partnerships with other companies, it also said it could achieve a latency of only 10 milliseconds with services in Tokyo, Seoul and Moscow.