MICROSOFT BUILDS A MOUNTAIN ON THE FARM TO BEAT SONY $MSFT $SNE $GME

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The battle between the new generation of gaming consoles from Microsoft MSFT +0.32% (MSFT) and Sony (SNE) is on.  Sony won round one when Microsoft tried to impose its highly unpopular restrictions on used game sales and internet connectivity on Xbox One.  Microsoft has tried to neutralize Sony’s advantage by rescinding the restrictions.

Microsoft is counting on what it’s calling “Project Mountain” to help Xbox One beat PS4 from Sony.  Project Mountain is a massive data center to be based in West Des Moines, Iowa.  The Des Moines Register  reports that the Iowa Economic Development Authority Board has approved $20 million in tax credits for Project Mountain.  Microsoft will initially invest $700 million in Project Mountain and later on push it to $1 billion.  Christian Belady of Microsoft said, “The expansion supports the growing demand for Microsoft’s cloud services.” The project represents “our latest in efficient data center thinking.”

Microsoft had earlier said that Xbox One would be supported by more than 300,000 cloud servers.  Now we know that these cloud servers are part of Project Mountain.

Parts of Microsoft’s strategy can be gleaned by an interview with Matt Booty, General Manager of Redmond Game Studios, published in Ars Technica.  Booty said, “Things that I would call latency-sensitive would be reactions to animations in a shooter, reactions to hits and shots in a racing game, reactions to collisions. Those things you need to have happen immediately and on frame and in sync with your controller. There are some things in a video game world, though, that don’t necessarily need to be updated every frame or don’t change that much in reaction to what’s going on.”

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There is an obvious question about such heavy dependence on cloud servers in gaming because traditionally cloud servers have produced a lag…Read more at Forbes

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