Remote video game streaming services like Gaikai or OnLive, which were launched earlier this year, will not be able to compete against local machines in the foreseeable future, claims Microsoft Corp. But the world’s largest designer of software believes that in longer term those services will make sense.

“I think streaming technology is something that [the industry] is betting on longer term. Right now I don’t believe that technology can scale out against the experience we can offer on a local machine. The technology will continue to improve. As an industry, we’ll have to accept that and move with it – but I don’t think it’s on an accelerated timeline for the foreseeable future,” said Jerry Johnson, product unit manager of Xbox Live at Microsoft, at London Games Conference, reports MCV web-site.

Remote video game streaming services, which allow their customers to play games that are processed by the server, not by the local hardware, have three main advantages over contemporary consoles or personal computers: gamers do not need to buy expensive hardware (which means that more people can be addressed), gamers do not need to acquire games themselves in a retail stores or carry any physical media (which makes games more affordable or even free in certain cases), gamers cannot pirate software.

But while remote game streaming services have a number of benefits, they are hard to implement from technology standpoint (Internet still generates input lags, video needs to be compressed and decompressed, etc.) and their economic model also does not seem to be really feasible (one customer should be provided with enough performance to play a game with 1920x1080 resolution with all the bells and whistles enabled, which typically means dedicated graphics processor and at least two CPU cores, something not exactly cheap).

In the long run the advantages of remote game streaming services may surpass their drawbacks, however, it looks like this will hardly be the case for the next ten years.

Tags: Microsoft, Xbox, OnLive, Gaikai