Insiders say Google lacked the focus and discipline to run a successful game studio

Cal Jeffrey

Posts: 2,879   +747
Staff member
In context: Part of what led to Stadia Games and Entertainment division's early demise is the underwhelming number of subscribers the platform managed to garner since November 2019. Although Google has not posted official numbers, Bloomberg quotes insiders stating Stadia missed controller sales and monthly active user count goals "by hundreds of thousands." The low adoption rates may be attributed to how the platform was marketed and released. This is arguably the biggest waste of money and resources in Google's history.

Stadia broke from Google's typical "start small and build" philosophy of product development. Unlike other Google products with long beta cycles, like Gmail, it was marketed and hyped as a full service that was ready to kill off consoles. Stadia head Phil Harrison said it was "the future of gaming." Speaking with anonymous sources, including former employees of the now-defunct development house, Bloomberg and Wired uncovered some details surrounding what was going on leading up to the closure.

Harrison is a veteran of console gaming, having served as an executive at both PlayStation and Xbox. While many in the Stadia team knew the platform was not ready to take on console gaming, Harrison was not dissuaded and "positioned Stadia as a traditional gaming platform full of bells and whistles."

Take-Two CEO Strauss Zelnick said Google "overpromised" with Stadia. "The launch of Stadia has been slow," Zelnick stated last June. "I think there was some overpromising on what the technology could deliver and some consumer disappointment as a result."

Harrison's console-like approach affected the overall Stadia business model. For instance, it required the $130 Founder's Edition controller bundle to have some way to offer pre-orders. Console makers generally use pre-order sales to grease the cogs of assembly lines and get initial product shipments out the door. This was not necessary in Stadia's case since just about any controller will work with the service, and Chromecast dongles were already well into their production cycle.

The subscription model also led many to believe early on that the service would operate much like Netflix with an all-you-can-play experience for one monthly fee. As it turned out, the subscription covered only a handful of games. At as much as $60 per title, Stadia's other offerings were no cheaper than buying a title elsewhere. As a result, potential users did not see the point to pay on top of the subscription, especially when they already owned some of the same titles on consoles or PC.

However, lack of user interest was not the only thing troubling SG&E. Former and current Stadia employees speaking with Wired indicated that Google might have been ill-equipped in both leadership and resources to operate a game studio. "After pouring tens of millions of dollars into two game studios, Google couldn't stomach the expensive and complicated creative process necessary to build high-caliber video games—especially considering Stadia's unremarkable subscription numbers," said the anonymous employees.

Google had already spent millions of dollars enticing third-party developers to release games on Stadia but knew it needed exclusive content to attract users to the platform. According to the insiders, this drive to create games for the sake of the system was the crux of the problem. The employees expressed that "Google wasn't funding games to sell games; it was funding games to sell Stadia."

To that end, it opened Stadia Games and Entertainment, hiring scores of workers and scooping up Typhoon Games along the way. Google lured veteran designers with the promise of a more relaxed work environment without the "crunch" and worry of layoffs. It also hired industry vet and founder of Ubisoft Toronto Jade Raymond to head up the division, so what could go wrong? Apparently, a lot.

For one, Google's ambition was to release AAA Stadia exclusives, but didn't have the existing talent for creating such content in time for launch.

"Google is really an engineering and technology business," said one source fortunate enough to still be employed with Stadia. "Making content—it requires types of roles that don't typically exist at Google." So the company went on a hiring frenzy, but its selection process was cumbersome, taking up to nine months to approve a new hire. The sources say it was hoping to hire at least 2,000 employees within five years. This goal became achievable after streamlining its hiring process to one more structured to game designers rather than software engineers.

However, after joining the fold, developers encountered a work environment not conducive to producing games. For example, three of Wired's sources confirmed that Google disallowed crucial game development tools because of "security" reasons. Another hurdle was Google's insistence of putting Stadia features above gameplay features.

"For a long time, the mandate for games included requirements to espouse the Stadia-specific mentality, so, like, taking advantage of features meant specifically for Stadia," said one of the insiders. Despite the desire to launch Stadia with first-party exclusives, being late to the game, throwing up development barriers, and having unrealistic expectations of development times, Google was forced to face the hard truth that it would not have anything new to offer when the platform debuted other than the indie title Gylt.

This shortfall did not seem to dampen Google's commitment to developing exclusive in-house content. It continued hiring and had actually accumulated a decent stable of talent. However, the pandemic hit in early 2020, and by April, Stadia had announced a hiring freeze. As the pandemic stretched into 2021, the company became acutely aware of how AAA development costs could ramp up, and suddenly the prospect of in-house exclusives became much less attractive.

"I think it's a lack of understanding of the process," said an insider. "It seemed there were executive-level people not fully grasping how to navigate through a space that is highly creative [and] cross-disciplinary." In other words, Google had bitten off more than it could chew. Despite upper management coming to this conclusion, they led developers to believe everything was still status quo as far as SG&E was concerned.

On January 27, Phil Harrison issued an email containing the "high-level platform budget and investment envelope" for 2021. In it, he also mentioned that SG&E "had made great progress building a diverse and talented team and establishing a strong line up of Stadia exclusive games" and noted that the division's budget was forthcoming. However, he was apparently just blowing smoke.

Google has no intentions of abandoning the Stadia platform

Just days later, coinciding with the launch of SG&E's only completed project, Journey to the Savage Planet, Google announced it was closing its studios. It promised employees with relevant skills would be placed elsewhere in the company, but most of the 150 game designers were laid off. Wired's sources said that the studio's closure was not that surprising considering the inner turmoil, but the fact that it came so close to Harrison's praise of the division and the launch of its only game was somewhat shocking.

At this point, Google has no intentions of abandoning the Stadia platform. There are several competing services from the likes of Nvidia, Sony, Microsoft, and others who want on the ground floor of cloud gaming. So it would be premature to pull out this early— after all, Sony has been trying to perfect PlayStation Now for over six years. However, if what Stadia leakers say is true, Google might want to reassess how it markets and runs a service that still has yet to prove itself.

Image credit: Colleen Michaels, Daniel Constante

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Watzupken

Posts: 90   +61
Based on my observations, this is a common problem with Google. They try to roll something out and hope that the ball will keep rolling on its own. I feel they generally don't see through the initiative, and will drop it as soon as they feel its not taking off. Stadia is just one of these.
 

Dimitriid

Posts: 320   +562
I think the distinction is the level of commitment needed. I don't think that the model Google wanted is inherently flawed, but to come into a busy, contended industry to try and change the way most people do business requires a very significant commitment. If anyone could afford it, it's Google don't get me wrong. But it would require them to invest potentially billions without expecting returns for a long time.

The approach wasn't the issue, is thinking they could expect the same results they get out of gobbling up small start ups but out of huge corporations that are not easily persuaded by just the promise of "Google money"
 

Uncle Al

Posts: 8,001   +6,775
Looks more to me like Google couldn't handle two different goals and tried to wrap them into one. I can't tell you how many businesses out there that make the same mistake every day .....
 
To me half the fun of gaming is having my own rig. I like to tweak here and there for better quality and performance. Keep up with the latest gaming technology and software utilities. It's the main reason I'm a member of Techspot. I do think it sucks that there is a chip shortage, and GPU scalpers. I'm some what suspicious that the market is being manipulated because things have really been so crazy lately, especially with the big tech giants. It will be interesting to see how it all plays out.













 

gcarter

Posts: 104   +40
As was touched upon in the article, my personal annoyance / reason for not taking up a stadia subscription was again that it was touted as a Netflix style service maybe not directly but the overall impression was.

...if so, it would have been incredible.

I’m not one for cutting edge games and if they had rolled out a service with titles which were several years old and just a monthly subscription, that would have been the sweet spot!
 

terzaerian

Posts: 694   +976
"Cloud gaming is THE FUTURE!" crowd has the same insufferable vibe as the "Console gaming is THE FUTURE!" clowns from a decade ago.

We will bury you.
 

koblongata

Posts: 398   +217
Geforce Now's way is way smarter... it only serve as a cloud service for the games you already own on GOG Steam Epic, you only pay monthly fees to use the service, no strings attached, and they don't even have 4K yet, Google really went so unrealistically far it's baffling.
 

Stoly

Posts: 81   +46
The business model is terrible for consumers.

AFAIK, you don't get to keep the games you purchased if Stadia goes kaput.

With Geforce Now you not only can you play many of your current titles, but the ones you buy, you keep no matter what... well unless steam. uplay and epic go down :p

Also you can't take advantage of epic/steam/ubisoft promotions.
 

Adorerai

Posts: 85   +52
Google doesn’t create content. They use yours, royalty free, to sell their services. There’s no escaping it, they own the internet. If you want to be relevant on the internet you need to include their analytics and tracking software. Everyone’s in a race to see who can feed google the most data about their sites and their users.
 

Theinsanegamer

Posts: 2,334   +3,316
Google never sees anything through. Stadia was 95% likely to end up in the bin after a few years, and consumers knew that. They're not going to dump money on a cloud gaming platform that has such a shaky background.

Running a game development studio is a difficult process, that takes several years minimum for a succesful product launch, has to contend with high turnover, and doesnt have constant data analytics and ad revenue attatched. This is something the ever ADHD-riddled google cannot maintain.

I give it 2 more years before stadia is shut down completely.
 

Soaptrail

Posts: 32   +37
Google never sees anything through. Stadia was 95% likely to end up in the bin after a few years, and consumers knew that. They're not going to dump money on a cloud gaming platform that has such a shaky background.

Running a game development studio is a difficult process, that takes several years minimum for a succesful product launch, has to contend with high turnover, and doesnt have constant data analytics and ad revenue attatched. This is something the ever ADHD-riddled google cannot maintain.

I give it 2 more years before stadia is shut down completely.
What Google pulls the plug on something after only finishing it 50%, shocking! I never thought twice about them cancelling stuff until they did it to Google Play Music. Now I don't trust anything they do to last. Not only that the shutdown timeline for Google Play Music was 6 months unlike hangouts which is going on 2+ years?
 

Avro Arrow

Posts: 1,033   +1,160
TechSpot Elite
Let's be honest here. Gaming never was and never will be Google's core competency. There's too much going on in that company for them to ever really challenge big game studios like Ubisoft or Square Enix who are dedicated game developers from the ground-up. It makes a big difference when top management is as passionate about making great games as anyone else in the company. Google would NEVER be like that and the games would suffer.

At the end of the day, no big loss.
 

Wrinkle

Posts: 38   +31
To me half the fun of gaming is having my own rig. I like to tweak here and there for better quality and performance. Keep up with the latest gaming technology and software utilities.

I can very much relate to that but for me that doesn't exclude other platforms or consoles. Streaming services are technically interesting, I used GeForce Now beta, MS xcloud beta, Shadow beta and I pre ordered Stadia. It's just nice to get acquainted with all of them.
 

terzaerian

Posts: 694   +976
I can very much relate to that but for me that doesn't exclude other platforms or consoles. Streaming services are technically interesting, I used GeForce Now beta, MS xcloud beta, Shadow beta and I pre ordered Stadia. It's just nice to get acquainted with all of them.
Streaming games was interesting to me for all of ten seconds when I tried out Steam streaming and thought "cool, I can play a game on my living room PC from my office PC" but that was basically it. The red flags started going off as soon as the likes of everyone else started getting in on it, and made it clear their intent was not to have you stream games you already own off hardware you already own. For them it's just the latest attempt to gatekeep consumer access to media and erode the concept of ownership further.
 

Wrinkle

Posts: 38   +31
Streaming games was interesting to me for all of ten seconds when I tried out Steam streaming and thought "cool, I can play a game on my living room PC from my office PC" but that was basically it. The red flags started going off as soon as the likes of everyone else started getting in on it, and made it clear their intent was not to have you stream games you already own off hardware you already own. For them it's just the latest attempt to gatekeep consumer access to media and erode the concept of ownership further.

Could be but I also tinkered with Moonlight over the internet and setting up vpn servers to stream to any device. It's just a vehicle to learn more about tech.
 

Avro Arrow

Posts: 1,033   +1,160
TechSpot Elite
As was touched upon in the article, my personal annoyance / reason for not taking up a stadia subscription was again that it was touted as a Netflix style service maybe not directly but the overall impression was.

...if so, it would have been incredible.

I’m not one for cutting edge games and if they had rolled out a service with titles which were several years old and just a monthly subscription, that would have been the sweet spot!
Yeah but you can get most of those old games as abandonware for free. Then of course, there's also Pandora's Box for old arcade games with real arcade control sticks and buttons:
3dx-wifi-pandorastoybox.ca-web.jpg

 
I can very much relate to that but for me that doesn't exclude other platforms or consoles. Streaming services are technically interesting, I used GeForce Now beta, MS xcloud beta, Shadow beta and I pre ordered Stadia. It's just nice to get acquainted with all of t
I can very much relate to that but for me that doesn't exclude other platforms or consoles. Streaming services are technically interesting, I used GeForce Now beta, MS xcloud beta, Shadow beta and I pre ordered Stadia. It's just nice to get acquainted with all of them.
I'll probably check out the free trial versions of them, but I have so many games that I have already bought and haven't play them yet. I live in a rural area and I was recently able to to upgrade from 3mps ( it would take a week to download a game, ) to 25mps that is shared between 2 pc's, so streaming maybe an issue for me. 25mps doesn't sound like much but for me it's been a god send. I can see where a platform like Stadia would attract people that don't have to invest in a gaming pc. And you don't have to go thru buyers regret from paying for a game that you end up not liking.
 

Stoly

Posts: 81   +46
I'll probably check out the free trial versions of them, but I have so many games that I have already bought and haven't play them yet. I live in a rural area and I was recently able to to upgrade from 3mps ( it would take a week to download a game, ) to 25mps that is shared between 2 pc's, so streaming maybe an issue for me. 25mps doesn't sound like much but for me it's been a god send. I can see where a platform like Stadia would attract people that don't have to invest in a gaming pc. And you don't have to go thru buyers regret from paying for a game that you end up not liking.
except you have to go thru buyers regret if you buy a game you don't like, even worse, under stadia, you don't actually own any of the games you buy. If you want to play them on your PC you have to buy them AGAIN...

Worst business model for consumers ever!!!
 
You have a very good point. I'm old enough to remember when you just bought a hard copy and you owned the game. I got away from gaming all together for a few years and it was an ajustment to have to deal with steam( the arrogant ^%$^*s,) and others like that. It down right pisses me off actually. It sounds like Stadia just rents you the game for the going retail price of buying it to own. Your right, that is a pretty bad deal.