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This small startup helps Microsoft sidestep the App Store with its new cloud gaming service

Rainway is helping deliver Xbox Cloud Gaming to iOS.

This small startup helps Microsoft sidestep the App Store with its new cloud gaming service

Rainway sees a lot of opportunity in cloud gaming ahead.

Image: Rainway

Beta testers of Microsoft's new cloud gaming platform could for the first time last week boot up the service on iOS, bringing Xbox Game Pass and its vast library of PC and console games to a portable screen you can fit in your pocket. That would not have been possible without a small startup called Rainway, a cloud gaming service provider that's become Microsoft's go-to partner for browser-based game streaming.

Cloud gaming comes in many shapes, sizes and delivery methods, but increasingly it is being offered through one of the oldest known open platforms: the web browser. The browser used to be anathema to those seeking and building high-quality gaming experiences. It was known mostly for old-school, Flash-powered web games and janky game-streaming apps that, while ahead of their time, highlighted how far media streaming needed to go before it could tackle a medium as complex as video games.

Yet advancements in codec and protocol technology — combined with massive leaps in connectivity speeds — mean you can now stream console-quality experiences with minimal latency and lag to a browser window on a computer, smartphone or tablet, so long as you have a powerful connection. The browser is having a bit of a moment in the game industry, too, as Apple's restrictions on iOS force game companies to rely on creative solutions to sidestep those barriers and reach iPhone and iPad owners.

That is, of course, if the cloud provider can iron out the many kinks that pop up when trying to stream high-bandwidth, interactive video streams to web browsers on both PCs and mobile devices. It's a tough problem, and even major tech companies struggle with it. That's precisely why a company as big as Microsoft tapped a Seattle-based startup consisting of less than 20 employees.

"Rainway's tech is unique in that we really mastered the browser ecosystem," said co-founder and CEO Andrew Sampson in an interview with Protocol. "Browsers are not really designed for the use case we're using them for. They've evolved a bit, but the traditional APIs are not a good fit." Instead, Rainway built its own, as part of a multi-year effort to develop its own cloud gaming platform. Now, that technology is helping power browser-based game streaming for one of the world's biggest game companies.

"We managed to finesse it all the way back in 2017 and over the years have built an experience that is basically the same as native gameplay that exists inside Chrome or Safari," Sampson said. Rainway licensed its technology to Microsoft through a software development kit it's planning to release more widely this summer, so any developer (and not just gaming companies) can access it to power apps and services of their own.

Rainway's speciality is in optimizing video streams and then properly encoding and decoding those streams as they move up and down the pipeline from a player's device to the provider's servers. It built the tech in its pursuit of a consumer platform that it ultimately couldn't find success with, Sampson said. But it's proving rather useful in Rainway's transition toward the enterprise.

"Going out and building a cloud gaming service with all the licensing deals you have to negotiate and also global infrastructure [you have to maintain] was just not in the cards for us," Sampson said of Rainway's early years, dedicated to building its consumer apps, which are still available today. "We got 1 million users off of that, but we never really saw how we were going to monetize it." After all, as Sampson pointed out, "game publishers and studios are not TV and movie studios or music labels" and are only just now coming around to the idea of licensing games to streaming providers rather than selling them outright.

When Microsoft launched its new Cloud Gaming beta (the consumer-facing name for its xCloud project) last week, it arrived on both PC and on iOS roughly nine months after the platform first became available on Android. The delay can be attributed to Apple, which said last August that its App Store policies bar cloud gaming apps from being distributed through its mobile storefront.

Apple eventually amended its rules to allow for narrow exceptions after receiving significant pushback from both gaming companies and the public, but the primary blockade barring services like xCloud and Google Stadia remained. Simply put, the App Store does not allow you to serve one app that contains access to multiple games within, either streamed from the cloud or downloaded. Instead, providers needed individual games to go through App Store review, and presumably be subject to the company's 30% commission. Microsoft called the compromise a "bad experience for consumers" and said it would find another way.

That other way is the browser, which Apple has offered as an alternative solution for apps that run afoul of its App Store restrictions. The end result is a number of new, browser-based cloud solutions popping up in the past few months to bring game streaming to iOS: Amazon Luna's beta in September, Nvidia's GeForce Now iOS beta in November, a Stadia progressive web app in December, and now — finally — an xCloud option.

Sampson said Microsoft approached Rainway last year to help it demo new data centers in Africa, with the startup's browser streaming tech used in place of the xCloud servers it traditionally relies on. After Microsoft hit its iOS roadblock in the summer, the Xbox maker turned to Rainway for a more permanent streaming solution that would help it deliver cloud gaming on Apple devices and Windows PCs.

It took a couple months of work, but Sampson said the company was able to repurpose a lot of the features and functionality it initially created for its native iOS app into a workable browser solution that supports WebKit, the Apple-owned software engine upon which Chrome and Safari are built.

Rainway sees a lot of opportunity in cloud gaming ahead, even if it's currently experiencing some growing pains since major players like Amazon and Google arrived on the scene.

"I've always been a fan of cloud gaming. It's not a new concept. It's been around for the better part of the last two decades," Sampson said." The technology has always been there — even in 2005. The tech is here, but the problem is always economies of scale."

Now that some of the tech industry's most powerful, cash-flush companies are in the game, everything has begun to change. "The idea of a startup building a cloud gaming business has always been a pie-in-the-sky idea. But now that we have companies like Amazon, Google and Microsoft going after it, it can work," Sampson said. Not only do these companies have experience building complex, cloud-based products, but they have the data center infrastructure to scale it. "These companies are investing in cloud gaming as an idea because they realize that they could be the ones that build Netflix for video games."

As for Rainway, it's content for now being part of the behind-the-scenes infrastructure required to make the service that consumers end up experiencing smoother. "If our technology can help bring cloud gaming to new users," Sampson says, "that's what we're here for."

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