Bank of America remained bullish on Alphabet Inc. GOOGL following the release of more details on Google’s new Stadia game streaming service, including prices and a November launch date.
The more detailed information about Stadia shows it initially will function more like an online game store than a game rental or streaming service, said Bank of America Merrill Lynch analyst Justin Post, and will have lots of competition soon, but is an ambitious platform.
Post reiterated a Buy position on Alphabet stock with a target price of $1,350.
What Is Stadia?
When Google announced Stadia in March, it promised a cloud game streaming platform that will allow users to play console or PC games by streaming them directly to any device with a Chrome browser, removing the need to buy an expensive PC or console.
What’s New?
Google this week revealed more details on how it will work, what it will cost, what players will be able to play and when it will be available. Google said Stadia will launch in November in 14 countries and will include at least 31 different games from 21 publishers. Among the games are “Ghost Recon Breakout,” “The Division 2” and they teased “Baldur’s Gate 3” is being worked on for the platform.
Stadia Pro will start at $10 a month, which allows access to the platform and a few free games.
But Google also said that users will still have to buy most titles, most at similar retail prices to what they’d cost on PlayStation, Xbox or other platforms.
“We will sell these games like any other digital storefront,” Google’s director of games Jack Buser said in a report in The Verge.
“We think the potential to buy games at full price on the Stadia storefront, and play them to the Stadia platform is an interesting twist (no console cost), but may be difficult to get core gamers to transition off of Sony and Microsoft platforms which have their content libraries,” BOA’s Post cautioned in a Friday note to investors.
Competition Coming
Post also expects Google to soon have “robust competition” in the cloud gaming space and mentioned Microsoft Corporation MSFT, Amazon.com Inc. AMZN and Apple Inc. AAPL as likely to soon have their own services.
Tailwind For Publishers
Post also said the new type of gaming platform should be a tailwind for game publishers of games, including Electronic Arts Inc. EA, Activision Blizzard Inc. ATVI and Take-Two Interactive Software Inc. TTWO.
Price Action
GOOGL traded up 1.9 percent Friday to close at $1,068.37.
Related Links
Google's Stadia Video Game Platform Announces Pricing, Games Structure
How Google's Stadia Video Game Streamer Will Be 'Highly Disruptive'
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