Games without consoles

Microsoft is in talks with smart TV manufacturers to allow users to play Xbox games without consoles. Microsoft will announce the new games at the E3 conference on Sunday.

Microsoft (MSFT) announced plans on Thursday to expand its game streaming business through partnerships with smart TV manufacturers as it sees a subscription model as the future of the video game industry.

Microsoft launches Xbox gaming consoles, offering its owners an Xbox Game Pass subscription from $10 a month with access to more than 100 games. Microsoft's game base was boosted after buying iconic studio Bethesda for $7.5bn.

Launched last September, Microsoft's Project xCloud streaming service offers unlimited streaming games for Android phone and tablet owners. In April a test run of the service was launched for access via a web browser on iPhones, iPads and PCs.

On Thursday, Microsoft announced that it wants to extend the Project xCloud service to televisions as well. To do this, Microsoft is working with manufacturers of smart TVs connected to the internet around the world to build its cloud gaming software into their devices.

As an alternative option for the smart TVs already released, Microsoft is simultaneously developing streaming devices that users will be able to connect to their TV or computer monitor to stream games from the cloud.

The video game streaming industry is becoming increasingly competitive, with major players being companies with large data centres and cloud computing capabilities. Microsoft is competing here with gaming streaming services from Google (GOOGL, GOOG) Stadia and Luna from Amazon (AMZN), and Arcade from Apple (AAPL).

Microsoft's revenues in the last reported quarter showed a 50% increase in sales of Xbox Series X and S gaming consoles, but global semiconductor shortages are limiting their production.

Xbox content and services revenue also rose 34% to $739 million, including Game Pass subscriptions.

Microsoft shares rose 1.44% on Thursday on the back of the news. Microsoft shares have risen 30.7% in the past 12 months, and since the start of 2021: 15,7%.