Tencent Holdings Ltd. and Sony Corp. Amplify Their Commitment To Cloud Gaming By Joining The Latest Fundraising Round Of Japanese Company Ubitus KK
Ubitus, specialized in cloud gaming technology and services, said Wednesday it completed a round of investments from Tencent, Sony Innovation Fund by IGV and Square Enix Holdings Co., without disclosing the amount raised. The investors have invested about $ 45 million at a valuation of less than $ 400 million, a person familiar with the matter said, asking not to be identified because the details are not public.
Tencent has stepped up efforts to promote cloud gaming, allowing consumers to enjoy high-quality games without owning expensive hardware such as consoles or computers. Just as Netflix streams movies, cloud gaming services deliver games from servers over the Internet to users’ TVs, smartphones, and other screens. Tencent said Monday it was helping OOParts, a Japanese cloud gaming platform, take advantage of the technology.
Still, cloud gaming has faced challenges even as wireless connections get better, with most enthusiasts sticking to titles that use gamers’ own hardware. Excitement caused by Google from Alphabet Inc. didn’t last long as the Stadia service faced challenges in communication latency and plan pricing. Stadia has shrunk many of its ambitions and Jade Raymond, a gaming industry veteran who was a party tent for Stadia and recently left, has set up a studio to work on a PlayStation game.
“Longer-term cloud gaming will ease the development burden of creating cross-platform games, expand gaming into new regions and generate higher subscription revenues, but it remains far from a core platform,” said Matthew Kanterman, an analyst at Bloomberg. Intelligence.
Despite the skepticism, many video game platform owners see potential in the technology and predict that it could coexist with console-based business models. Sony offers PlayStation Now and Microsoft Corp. has Project xCloud, both of which offer streamed games to subscribers.
Founded in Taiwan in 2007 and now based in Tokyo, Ubitus is a major provider of cloud gaming solutions. His partners include Nintendo Co., which provides cloud-based versions of the Resident Evil and Assassin’s Creed from Ubisoft Entertainment SA on the Switch. Square Enix uses the startup’s technology to run its popular Dragon Quest X online multiplayer role-playing game. Ubitus’ cloud gaming patents are often praised for its low latency.