Episode 2: Cloud Computing in Gaming

Hello again, and welcome to Episode 2 of "Griffin Gaming Perspectives," a series of biweekly installments from the team here at Griffin Gaming Partners. My name is Anthony Palma and I serve as Principal with Griffin GP. My background and career have been centered around technology within gaming, so for this week’s Perspective I’d like to share some basic information on a topic we find crucial to the future of the industry: cloud computing

For the past several years, consumers have been presented with the promise of “cloud gaming” and how it will change the way we access and play games forever. Before I get into the state of cloud gaming though, there is a very important distinction to understand: “game streaming” (eg. Google Stadia, PlayStation Now, GeForce Now, xCloud, etc.) is just one use case of cloud computing for gaming. Often we see the phrases “game streaming” and “cloud gaming” used interchangeably, but there are actually several other equally important use-cases for cloud computing in gaming beyond game streaming. Some of them have been around for decades, and some of them will come to mass-market fruition in the next several years alongside game streaming. 

So, while I could spend hours going through the specific technical details, potential market opportunities, and the exciting present and future of cloud gaming, I will start by giving you our 10,000-foot view of the six major use-cases for cloud computing that we see in gaming today for this Perspective. We may dive into more details on these topics in a future post, as we are excited to see the role of cloud computing continue to expand in our industry.

Digital Downloads


Digital downloads were one of the first and simplest uses of cloud technology in delivering games to consumers via direct online file downloads rather than requiring physical discs/drives. 

How it works

Digital downloads are any files - media or otherwise - hosted in a central cloud storage unit (essentially a hard drive in the cloud) that is accessible by anyone with a verified connection to it. These files can then be accessed and downloaded from that cloud storage directly to a user’s local hard drive, which then allows them to run locally on said user’s device. 

Use Cases

Digital downloads are primarily used for full purchases of games in place of buying a physical disc. Since the game files exist on a user’s local hard drive after download, full ownership of the files makes the most sense.

Real-Time Pixel Streaming


Real-time pixel streaming (AKA game streaming) describes when a game is being run on a remote, powerful cloud server rather than running on a user’s local device, and the user interacts with a live video feed of the game running remotely.

How it Works

At a high level, the game itself is installed and run/rendered on a remote, often GPU-powered, cloud server. The user can interact with the game in real-time by viewing a live video feed of the game running on that remote server and sending input commands to the server via their normal controller/keyboards/mice via the internet. Because the game isn’t installed and running locally, there are no up-front download, storage space, or hardware requirements to play the game.

Use Cases

Real-time pixel streaming best enables higher-quality content on lower-quality devices as well as the ability to play “on the go” without having to wait for long download times or installs.

Progressive Downloads


Progressive downloads are an advanced form of digital downloads which allow games to be delivered to a consumer in very small chunks on an as-needed basis, or “on demand.” 

How It Works

Original full-size files are stored in central cloud databases, and then are sent to various smaller “edge server” data centers that are positioned in specific geographic locations to be as close to as many users as possible. These edge servers break up the full-size files into small chunks and send them to users as-needed to minimize data usage and local storage requirements.

Use Cases

While this is most common in video and audio “streaming” it is most commonly used in mobile games for delivering small content packages without requiring a full app update. It is also useful for platforms that allow users to download the first level/area of a game to begin playing quickly.

Cloud-Driven Computation


Cloud-driven computation describes the use of powerful cloud computers to handle complex and intensive computations in games rather than relying on a user’s local hardware. Think of this as expanding the upper limit, whereas real-time pixel streaming reduces the lower limit.

How It Works

Utilizing a cloud infrastructure for complex and large-scale computations allows game developers to create experiences that expand beyond the confines of a user’s local hardware. These computing needs are managed by cloud servers that can expand/reduce compute power as needed to provide whatever amount of resources are needed on-demand for a game.

Use Cases

This enables opportunities like physics simulations for fully destructible persistent cities in games, expanded MMO server user capacities, and massive seamless worlds cross-platform.

Networked Multiplayer


Networked multiplayer has been a common use of cloud computing in gaming. Multiple users, using different devices, can connect to the same game environment and interact in real time.

How It Works

While the game itself is typically running (processing and rendering) locally on each user’s device, certain data like user position, gunfire, etc. is communicated out to a cloud computer that is “hosting” some authoritative logic for the multiplayer session. This logic checks for possible exploits before relaying incoming data from one player back out to all other players to keep all their positions and information in sync across their various devices.

Use Cases

Real-time multiplayer may get the spotlight with big-brand competitive games, but asynchronous multiplayer where players can take turns at their leisure has also been huge in mobile gaming

Real-Time Analytics and Events


Real-time analytics and events driven by cloud computing allow developers to capture, process, rationalize, and act upon important user data in real time as users progress through games.

How It Works

As a user plays through a game, certain data can be collected on their habits, play time, spending, etc. and can be relayed in real time to cloud servers. The two main reasons cloud computing is important for this collection is for data security and for mass processing at scale, so developers can both better protect and understand their potentially millions of users quickly.

Use Cases

Games that utilize Live Operations have found real-time analytics and events incredibly useful for customizing the user experience to improve retention, engagement, and monetization for their games long-term. Being able to make tweaks on the fly based on real-world data has proven invaluable in the Games-as-a-Service category, particularly on mobile.

Our Perspective

Cloud computing has already played a major role in gaming for the past two decades, and we fully expect its uses to expand as the industry continues to evolve over time. The connectedness and expansive compute power it provides to gaming will give way to new types of content and new ways for players to engage with each other. Cloud gaming will continue to reduce the friction between players and the games they love, be it via easier/faster access, more content updates, or more ways to play with friends. This of course allows player to spend more time and money in their favorite experiences, which will ultimately drive the value of these games, and the industry as a whole, up. Cloud computing will also allow game developers to speed up their processes, work better remotely, and invent new types of experiences for their users to further reduce friction points and increase the value of their creations.

Cloud computing within gaming is here to stay, and we believe the industry is just starting to tap into its potential.


Episode 1: Griffin Perspectives

Hello, internet friends. It is my pleasure to introduce the first installment of “Griffin Gaming Perspectives,” a series of biweekly installments from the team here at Griffin Gaming Partners. We are gamers and we are venture capitalists. These brief essays aim to afford our readers a little more clarity on what is happening in the ever-changing and deeply exciting world of video games.

The games industry is one that is profoundly susceptible, yet receptive, to massive changes. Everything changed when Ninja queued into Fortnite with Drake, JuJu Smith-Schuster, and Travis Scott 2 years ago. We saw an increased focus on cross-platform play, the rise of influencers on communities and the relevance of games streaming in popular culture. These unique events drive the industry forward in fun and exciting ways and we will strive to elaborate on these unpredictable catalysts of change in the coming writings.

Unreal Engine 5 and the Next Generation

The predecessor of Unreal Engine 5, Unreal Engine 4 has been at the forefront of games development since its release in 2014. While tech has largely kept up with the creative demand of developers, a new Unreal Engine marks a significant leap forward in graphical capabilities for entertainment. Unreal Engine 4, owned by Epic Games, boasts more than 2 million developers using the platform. A new iteration of this technology is critical for empowering titles for the next generation of games when new consoles (Xbox Series X, PlayStation 5) and graphics cards launch later this year. At Griffin, we can’t wait to see what this next generation of games will show wielding this new technology. Given the gaming industry’s embrace of live events and never-ending quest to get content to the next level, Unreal Engine 5 will greatly enable developers’ ability to tell stories within the gaming medium.

Worldwide Digital Video Game Spending Hits Record-Breaking $10.5B in April

Games now account for 87% of spend on mobile – a trend that we believe to be very indicative of the demand for premium content. Games have always represented a significant value proposition for the consumer when compared to traditional forms of media such as film. This has never been clearer than it is now given that people are starved for new content amidst lockdown and pervasive boredom.

Let’s look at two examples of long-form film and long video games to compare the amount of entertainment each provides. The Witcher 3: Wild Hunt takes an experienced player 25 hours to get through the core story, and about 200 hours to complete 100% of the content. To get through the entire Lord of the Rings Extended Edition Trilogy, it would take a viewer 11 hours and 22 minutes – which is still less than half of the playtime of the Witcher 3’s main storyline. In times of entertainment need, video games hold a large advantage over film and TV. The replayability and durability of content, especially considering the robust social offerings in games, are becoming increasingly necessary during global stay-at-home orders.

Fortnite Hosted a Psychedelic Travis Scott and 12.3M People Watched

What does this mean for live events? Concerts touring? Games-as-a-service? Fortnite has been a pioneer of digital live events that fuel the content desires of the community as well as the ever-expanding, multiverse narrative of Fortnite. Just this week, Fortnite ushered in the end of Chapter 2 Season 3 with a well-produced, experiential live event (The Device), which was viewed by 6.1M+ on YouTube and 2.3M+ on Twitch alone. In a post-COVID-19 world, when populations are still deprived of new traditional content, such as films and concerts, these digital live events will continue to grow in scope and scale. And the platform on which these events take place matters intensely. When Griffin looks at making an investment in content, our principal concern is: “Is it fun?” The Fortnite Marshmello concert or Travis Scott’s Astronomical have been enormously successful because they engage the audience in a familiar, fun and interactive environment. We believe that this trend is just getting started and we cannot wait to see where it goes.

We think there is no greater reinforcement of our stance than our recent investment in Wave – the next generation of concerts has already arrived, evidenced by Wave’s previous transformative digital concert experiences like the Church of Galantis concert earlier this year.