Microsoft has confirmed today, that a dedicated game streaming device will be released soon. Microsoft is also collaborating with a number of TV manufacturers to integrate the Xbox experience directly into their internet-connected displays, and it expects to introduce cloud gaming to the PC Xbox app later this year, with a focus on play-before-you-buy scenarios.
The physical appearance of these new game streaming devices isn't yet revealed, as Microsoft has neither given any additional information. But it's more than likely that we're talking about a Chromecast-style streaming stick or a small Apple TV-style box. We also don't know which TV manufacturers it will work with at this time.
It's no secret that Microsoft believes in cloud gaming. With Xbox Game Pass Ultimate, subscribers can already play more than 100 console games on Android, streamed from the Azure cloud, for example. It will offer cloud gaming in the browser on Edge, Chrome, and Safari to all Xbox Game Pass Ultimate customers in a few weeks (that is currently in limited beta). Later this year, it will also bring Game Pass Ultimate to Australia, Brazil, Mexico, and Japan.
In many ways, Microsoft is trying to decouple gaming from the hardware, similar to what Google is attempted with Stadia (which has so far failed) and Amazon with Luna. With the exception of Nvidia's GeForce Now platform, which has a different revenue model because it focuses on allowing you to play games you buy in third-party stores like Steam or the Epic Store, Microsoft has a big library of popular titles, which is generally lacking on rival services.
Microsoft clearly wants to extend the Xbox ecosystem as a whole, even if it means selling fewer dedicated high-powered consoles. The company compares this to the music industry's shift to cloud-based services supported by all-you-can-eat subscription models.
Microsoft’s Xbox head Phil Spencer says, “We believe that games, that interactive entertainment, aren’t really about hardware and software. It’s not about pixels. It’s about people. Games bring people together.” Adding further he explains, “Games build bridges and forge bonds, generating mutual empathy among people all over the world. Joy and community -that’s why we’re here.”
It is important to note, though, that Microsoft has stated that it is not ditching dedicated hardware and is actively working on the next generation of console hardware - but don't imagine a new Xbox console anytime soon.