Microsoft Corp. today previewed Project xCloud, an upcoming service intended to make video games that currently require a personal computer or a gaming console playable on mobile devices.

The announcement comes a week after Google LLC revealed plans to launch a game streaming service of its own. If they live up to their promise, the offerings could give the tech giants a valuable slice of the gaming market, which is expected to generate more than $125 billion in revenues this year, as well as create broader appeal for their cloud services.

Microsoft already has a big presence in this industry. The company’s Xbox One console is among the most popular in the category and it has a prolific in-house game studio with several big titles under its belt.

More importantly in the context of Project xCloud, Microsoft operates one of the world’s largest infrastructure-as-a-service platforms. The service is powered by specially developed blade servers that the company is currently testing in its Azure data center in Quincy, Washington. The machines are derived directly from the architecture of the Xbox One.

“We’ve enabled compatibility with existing and future Xbox games by building out custom hardware for our datacenters that leverages our years of console and platform experience,” Kareem Choudhry, the corporate vice president of Microsoft’s Gaming Cloud group, wrote in a blog post. “We’ve architected a new customizable blade that can host the component parts of multiple Xbox One consoles, as well as the associated infrastructure supporting it.”

According to Microsoft, the current iteration of xCloud requires connection speeds of at least 10 megabits per second to stream games. That’s less than half the recommended minimum Google has set for its rival service and below other, existing offerings such as Nvidia Corp.’s GeForce Now as well. The reduced connectivity requirements could enable Microsoft to reach a broader audience of users, assuming it manages to maintain an edge after launch.

The company will begin public trials of xCloud will begin next year. Users will have the ability to stream games both to their tablets and smartphones, according to the company. 

Microsoft’s and Google’s push into game streaming come as carries worldwide start bringing the first 5G networks online. The term 5G refer to a set of technologies that promise to bring internet speeds 10 to 100 times faster than what today’s infrastructure supports. As connections become faster, streaming games over the web should become a viable option for more consumers, which could bring about a rapid expansion of this market.

Photo: Microsoft