Tuesday, September 25, 2012

Cable Plans To Make Consoles A Bygone, Xbox Stands At A Risk – Verizon, AT & T, Time Warner Cable (VZ, T, TWC)

As per secret sources that are acquainted with the matter, Verizon Communications Inc.(NYSE:VZ), AT&T Inc.(NYSE:T) and Time Warner Cable Inc(NYSE:TWC) are getting ready for a push to provide games directly to televisions. A shift in strategy seems to pose threat to traditional consoles such as Wii, Xbox and PlayStation.

Trials of cloud gaming services may start later this year. Hence, carriers can test and modify the technology before going to wider developments that may start in 2013. Other carriers are targeting for 2014.

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If successful, internet-based games are likely to accelerate a shift away from gamming consoles that have been the main money maker of the industry since the past three decades. Microsoft, Sony and Nintendo have helped in building a market that is worth $24.1 billion in the US in 2011, as reported by NPD Group. Customers are already getting rid of consoles and turning to games played on tablets and smartphones, resulting in 39% fall in video game hardware sales the previous month.

A video-games analyst at Lazard Capital Markets, Atul Bagga said that everyone owns a TV and as cable and phone firms are exploring new ways to monetize their users, gaming can be gripping.

By adding popular games to their TVs, phone packages and internet, carriers can provide another service to their nearly 50 million subscribers.

Apart from Verizon, Time Warner and AT&T, Cox Communications and ComCast are also considering to offer video-gaming services. They all are looking to go beyond social games offered by Zynga and casual games like Solitaire and Tetris.

For technology, the carriers are taking help of Agawi, CiiNow and Playcast Media Systems that provide software to ensure quick delivery of real-time gaming. Executives of those companies revealed that they are engaged in discussions with US carriers. However, they have not disclosed the names of the carrier companies.

Shares of TWC are up 0.20%, AT&T rose 0.13% and VZ added 0.24%

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