Microsoft-Activision deal: What is 'cloud gaming'?

tech.hindustantimes.com:

Technology firms have long dreamt of shifting gamers away from cumbersome consoles and physical purchases to subscriptions and virtual access -- essentially a Netflix for video games.

However, on Wednesday the UK's antitrust regulator blocked Microsoft's purchase of Activision largely because it had the potential to kill competition in the still developing "cloud gaming" sector.

- How does cloud gaming work?

For decades, the console has been king. Sony's PlayStation, Microsoft's Xbox and various Nintendo units have dominated.

Millions have also enjoyed gaming on their PCs.

But the arrival of superfast broadband has allowed companies to experiment with new ways of delivering and monetising games.

Rather than buying games and storing information on their personal consoles and PCs, gamers would pay monthly fees, access a suite of games and have their data stored on servers far away.

Doing away with the costs of manufacturing and delivering hardware would allow healthier profit margins and capture whole new audiences.

At least, that's the theory.

- How big is the sector?

Some 32 million people were paying for cloud gaming services last year out of a gaming population of more than three billion, according to Newzoo, a data analysis firm.

This translated to revenues of about $2.4 billion, according to Newzoo, with the wider industry worth more than $300 billion globally.

But analysts are largely united in predicting huge growth for the sector, fuelled by rising numbers of potential players.

"It's set to become an industry worth at least $40 billion by 2030, growing by around 40 percent annually according to industry estimates," said analyst Susannah Streeter from Hargreaves Lansdown.

In its 400-page decision to block the