Amazon (AMZN, $1,656.22) to Foray into Online Videogame Streaming

According to a recent Information Report, Amazon has upped its services by foraying to develop an online videogame steaming service that would stream gameplay over the internet.

Currently, the videogame sector is undergoing a paradigm distribution shift from its earlier physical discs to online download. In light of this shift, the emergence of game streaming services will be a significant development, as it may release players from the pressure of buying expensive hardware as the processing power needed to play complex games shifts to data centers, simplifying user devices.

According to Amazon, this service will not hit the market until early next year as the company is yet to collaborate with game publishers, whom they have recently approached to consider bringing their content to the streaming service.

However, the development of a Web-based gaming hub would mark a significant step for Amazon in a market place already inhabiting players like Microsoft (MSFT) and Google (GOOGL, GOOG).

Expected to bring top-notch games to virtually anyone with a smartphone or streaming device, the service is expected to provide the customers a wider universe of gaming content through a monthly subscription. For Amazon, it is expected to bring a steady revenue stream along with a broader pool of potential customers for its other businesses.

Advantages for Amazon for foraying into this business – one, its massive online store; two, direct access to a broad set of internet customers, as it leads the global cloud computing industry commanding 32% market share compared to Microsoft Azure’s 17% and Google Cloud’s 8%.

This new development follows Amazon’s cloud-based service launched last spring called the GameOn cloud service that helps developers easily add leader boards, competitions, invites, and giveaways into games.