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The $130 billion video game industry is facing its "Netflix moment:" a coming streaming boom will sap the market for physical consoles. (Photo by Yuki Kohara)
The Big Story

A Netflix moment for gaming? Streaming challenges consoles in 5G era

Former rivals Sony and Microsoft ally to take on new 'cloud gaming' platforms

AKITO TANAKA, Nikkei senior staff writer, and JADA NAGUMO, Nikkei staff writer | Japan

TOKYO -- In May, Sony CEO Kenichiro Yoshida faced his counterpart at Microsoft, Satya Nadella, on the sprawling campus in Redmond, Washington, that houses the world's largest software maker.

The meeting was the culmination of highly secretive talks about a joint venture in a market where they had previously been fierce rivals: video games. For nearly two decades the companies' consoles -- Sony's PlayStation and Microsoft's Xbox -- have competed for space in living rooms around the world, investing billions in technology and intellectual property to win over gamers. But, on May 17, the pair announced that they would now be collaborating, developing game and media streaming services based on Microsoft's Azure cloud computing platform.

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