Gaikai looking for a buyer

The cloud-streaming service will serve itself up to the tune of $500 million

Anonymous sources have told CNN Money that Gaikai is looking for a buyer. The cloud-streaming service has apparently already hired bankers and is looking for a purchase price above $500 million.

Gaikai differs from rival OnLive in that it has no direct consumer service, instead choosing to aim at publishers and developers. The company has already raised around $45 million in funding and has partnered with Electronic Arts, WalMart, Facebook, and Youtube.

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Latest comments (14)

gi biz ;, 7 years ago
Seriously? To date I couldn't get to try any of those services yet. I didn't even know they were still on business. Gaikai gives me a mostly blank web page with random messed up graphics as I move the mouse, and OnLive says "The demo is currently unavailable on this platform. Play this demo on a PC or Mac". After a thorough look at my machine I would say it's indeed a PC. Makes me think of Dogbert.

But then, wasn't the deal to play my favourite games on my phone, TV, PSP, raspberry pi, whatever has an internet connection and a browser?
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Bruce Everiss Marketing Consultant 7 years ago
The huge growth to come is with smart TVs. Gaikai already have a deal with Samsung.
Other TV companies have just formed the Smart TV Alliance to unify standards. Their mission statement is 'build once, run everywhere'.
Apple TV is due out later this year.

The components necessary to make a TV smart are very cheap. So soon all new TVs will be smart. And with the introduction of OLED most people will be replacing their existing televisions. So there will be very rapid market penetration.

Gailkai is ideally poised to become the major player on a platform that there will soon be billions of.
This is their value.
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Morville O'Driscoll Blogger & Critic 7 years ago
And with the introduction of OLED most people will be replacing their existing televisions.
People with lots of spare cash will gladly replace their TV with a new state-of-the-art one. However, you look at the economy generally, and you don't see many people with lots of spare cash. TVs aren't like phones, where touchscreens have become ubiquitous because you can get a low-end touch-screen for 40. TVs are expensive pieces of kit - more in-line with cookers, fridge-freezers and washing machines - and people tend to replace such things when their current model dies, or becomes obviously outdated. Market penetration won't spread as quickly as you think, I think. :) (See also: Digital replacing Analogue)
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Bruce Everiss Marketing Consultant 7 years ago
OLED televisions are a big jump up from LCD. The picture quality is hugely better. They also use a lot less electricity.
When the manufacturing industry gears up they will be a lot cheaper to make because the screen is basically created by lithography and the layers of filters are not needed.

Read more about them here:

Sony have had a small but very expensive model for a few years. But now the industry is gearing up to mass produce them, starting with top end models appearing in the shops this year. Then LCD televisions will rapidly go out of production. Once you have seen an OLED television you will not be happy watching an LCD television again.
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Morville O'Driscoll Blogger & Critic 7 years ago
Once you have seen an OLED television you will not be happy watching an LCD television again.
Not trying to be too argumentative here, but...

Do you really think people who watch Eastenders, X-Factor and Sherlock care about picture quality that much? Market penetration is about getting the largest demographic to buy your product, and I'm telling you now, LCD to OLED picture quality won't matter to the casual viewer, until their shiny LCD with built-in Freeview either looks horribly outdated (which seems unlikely), or dies.

As another example, my girlfriend doesn't really notice - or care about - the difference between a 720p BluRay rip and the original BluRay. And that's on a 42inch 1080p TV.

Edited 1 times. Last edit by Morville O'Driscoll on 22nd June 2012 10:15am

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gi biz ;, 7 years ago
As far as I know TV sets are losing terrain. I don't know many people between 20 and 50 who still enjoy watching TV. It looks like a thing of the past. I would buy a TV set for 50 max maybe. Or maybe not. But that could be cultural, maybe the UK is still big on TV.
But why would I need special hardware to enjoy a service advertised to be hardware-independent?

Even if they decide to go back on that, he point is that the service should work *before* they make you buy new hardware. Their websites look half abandoned, so after all it was a failure as expected by many?
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Devante Adams designer 7 years ago
Facebook or google will buy this as it fits their long term strategy. I think Microsoft will want to buy it when it is too late instead of buying it now. A surprise buyer could be Apple merging it with iCloud but only if it can see value in it selling a product (maybe Apple TV)
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Nick Parker Consultant 7 years ago
I find this news astonishing. Gaikai is a long term play with potential long term better value than $500m. Their infrastructure should be a draw either for an acquirer to have a ready built cloud solution or for a current digital distribution community builder like Steam, PSN or Xbox Live to bolt onto what they already have. The Asian players like the Chinese networks or Korean consumer electronic manufacturers (Samsung, LG) could be interested.
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Maybe they figure its all still in the Clouds at the moment...
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This makes me *very* suspicious. If the owners of Gaikai *really* had faith in the service, they would be in this for the long haul - it could be worth $5bn in a few years. Putting it up for sale now, and at this price - tells me either the market is too competitive, they have run out of money ... or something else we don't know about. Maybe it was always a "rich quick scheme", and the VCs want out...
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Andrew Goodchild Studying development, Train2Game7 years ago
It seems weird that they would be trying to sell before really getting going. Sure they are signing deals, but have they got much in the way of revenue streams? They may be coming to Smart TVs, but I don't think (correct me if I'm wrong) those Gaikai enabled TVs are actually on the market?
I'm sure someone will buy it, but it seems early to sell a business that apparently the owners believe in, before it has ramped up much.
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Urs Schaub 3D modeller AA 7 years ago
If im not mistaken you can try gaika service over greenmangaming dot com's demo section, it works but i wouldn't call it afirst class gaming experience.
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Robb Lewis Director of Marketing and Consumer Products, PlaySpan7 years ago
we're they unable to get the technology to work at scale or is this more searching for a larger network provider (comcast, at&T??) with expertise and deep pockets to fund a mass build out? Is $500m low?
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Greg Wilcox Creator, Destroy All Fanboys! 7 years ago
To quote whomever coined it: "It's the economy, stupid." (No, I'm not referring to anyone here, mind you). All this new tech costs money, but a lot of people it's aimed at probably can't afford it in the numbers Gaikai needs to continue in its present form. I guess if Apple bites and snaps them up and slaps the service into their TV's, they'll be a household name within seconds of the announcement.

Granted, what an Apple TV will cost (minus whatever fees they'll charge for content) is going to be more than a lot of people can afford, save for Apple users who seem to have more disposable income than non-Apple users, who probably won't give a hoot about a TV that's not going to change anything about the way they prefer to watch and play.
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