Gaikai: Microsoft will have to enter TV market

Gaikai co-founder David Perry believes that Microsoft will be forced to enter the TV market to compete with more hardware focused companies like Apple and Sony.

In an interview with CVG, Perry claims that the expanding functionality of the Xbox and PlayStation 3 combined with the emergence of cloud-gaming through Smart TVs will change the way consumers look at consoles.

"I think [the platform holders are] going to stop calling them consoles and they'll start calling them something else," he said.

"Digital TVs are including all of that media stuff. I think the mistake that the console companies are making is not a mistake of their choice - it's the evolution they have to go through.

As soon as AAA game experiences are accessible through "other media hubs" it will disrupt the traditional console market, shifting advantage to those companies with the ability to produce TV hardware.

"I don't mean Checkers, but things like Call of Duty - the public will get confused," Perry continues. "With that in mind, who is able to make a TV? Sony is already making them, so it will have to take all that stuff into its TVs.

"So: my prediction is that Microsoft will have to make a TV. What choice do they have? There have been lots of reports that Apple has bought out a large LCD panel-making company. It's pretty obvious that they're on the trail too."

Last month, Gaikai inked a deal to include its service in LG TVs, and the company's other executives have made no secret of their doubts over the precarious future of the console business.

Microsoft has given no clear indication that it is contemplating a move into television hardware, though television content will play a key role in the future of the Xbox platform.

In December last year, rumours emerged that the company was seeking an executive to develop first-party TV content for Xbox Live. However, plans for an "Xbox Live Diamond TV service" were recently put on hold due to prohibitive licensing costs.