Sony and Microsoft forge what looks to be a historic partnership.

Yesterday, in a surprise announcement, Microsoft and Sony forged a new strategic partnership, one that will have big implications for both the gaming and tech industry. I have to admit, the news had me doing a few double-takes! The partnership seems unlikely, but looking at what each has to gain, this is not only exciting for the companies, but consumers and the industry as a whole.

To start, the announcement outlines Sony will use Microsoft’s Azure cloud-computing infrastructure for its gaming and entertainment endeavours. Sony has made moves in the past to bolster its cloud gaming capabilities purchasing Gaikai in 2012 for 380 million. Yesterday’s announcement sounds even bigger: Sony and Microsoft will collaborate on cloud gaming initiatives, artificial intelligence, content creation tools, and semiconductors. Phil Spencer, Vice-President of Gaming at Microsoft also tweeted about the partnership, cementing the connection to the gaming industry.

Although the companies have maintained a good relationship in the tech industry, they have long been rivals in the video game space. With this new agreement, the landscape has changed overnight. Many potential collaboration opportunities could arise from this newly formed partnership. It’s exciting to see where this relationship will go, and how it could change the face of the gaming industry going forward.

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Matthew’s Take:

The partnership is very new, but it’s interesting to ponder how involved it could become. To state the obvious: don’t count on Master Chief arriving on your PlayStation or Kratos on your Xbox just yet. The first potential outcome of this partnership would be for PlayStation Now to get a powerful upgrade on the backend from Microsoft Azure. Project xCloud could also power both PlayStation and Xbox gaming experiences over a variety of devices. With Google Stadia cloud gaming offering on the horizon, this partnership is likely a result of new competitors entering the space. The future of the gaming industry looks interesting, and the next battleground appears to be cloud-based experiences.

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