Edge gaming is very much a platform business, meaning it takes a village to be successful, a whole ecosystem. As such this is not for everyone. By our count there are eight companies with some of the pieces of a solution, and of these only five are officially in the business.

As we mentioned in our initial piece, edge gaming is the idea behind decoupling game software from specific hardware requirements. All titles are ‘cross-platform’ and can be played on a PC or mobile phone or tablet. This requires five elements:

1. A service. This is the heart of the platform and is a big lift for companies to develop. Only a few companies have the resources to build this.
2. Infrastructure. Edge gaming shifts a lot of the burden to the network and cloud. So anyone competing here needs to invest heavily in building up this capabilities. As it turns out, most of the competitors are cloud service providers which simplifies things. Everyone else is either going to need to pay heavily to use someone else’s cloud or build their own data centers.
3. Game library. Without games, no one will use the service. Companies will not need their own games, but they will need to sign a lot of licenses and heavily evangelize their platforms.
4. Developer tools. Related to #3, the platform will need to build tools to appeal to game studios and publishers – audience tools, analytics and clean APIs for example. All the things it will take to get games to run on the platform.
5. Streaming. Beyond normal infrastructure, these companies will need the ability to stream large quantities of video. They will also need tools like tipping and messaging to attract influencers.

To be fair. There are individual games which can manage all this. Games like Fortnite and Vainglory are cross-platform, but they lack two elements separating them from other platforms. First, they still have underlying hardware requirements which may seem like a minor distinction, but does limit the overall size of their market. Read the user forum comments about cross-platform games, especially on mobile, and a large percentage of the complaints center on poor performance on particular devices.

Secondly, these games cannot support other titles or offer their platform as a service to other. Admittedly, this is a bit blurry for Fortnite, their huge success has made them an outlier by providing them the resources to do whatever they want.

One of the hardest parts of getting games to work online centers on networking issues. Game servers have to be close to the players or delays in communication impact game play. The second most common complaint in game forums are all about ‘ping’ or latency in gameplay. This is a thorny issue, since provisioning game servers is expensive, developers have to balance gameplay and user experience against capital and operating expenses. Having a complete platform of game titles reduces this pain oint as it provides economies of scale with gameplay support costs amortized over a larger number of players.

We saw some of this several years ago with Riot Game, publisher of the hit League of Legends game, who used their scale to build their own content network. Riot went out and signed a range of connectivity deals, leasing fiber and placing their servers all over the map. For example, the problem is particularly acute in Asia with a large number of countries across a vast geographic expanse. Gamers in India sometimes have to connect to a server in Singapore or Hong Kong, thousands of miles and a half dozen national boundaries away. Supporting these kinds of complexities requires a large team of network operations engineers and business development professionals to sign up all the fiber and Internet exchange points.

All of this costs a lot of money and is only viable for a small number of companies. There are only a handful who can afford this support. In our next piece, we will walk through who those players are.