Esports Circus: Everything You Need To Know About Cloud Computing

September 7, 2022

Article written by Jeffrey Weiss of Esports Circus

Cloud computing is the future of everything entertainment and gaming. Remote computing on servers in a centralized location provides many benefits for players and companies and can be game-changing for schools. Here is everything you need to know about cloud computing, its benefits, costs, and how it can help you.

The future of gaming infrastructure

Let's talk about virtualized systems and how I feel that they are the future of gaming infrastructure. When people think about an esports gaming center, they think about putting a bunch of computers on desks, throwing some paint on the walls, and calling it a game center or an arena. Neither of which is true. There are a lot of issues with this type of infrastructure. 

This article will detail the problems with using PCs to run your gaming systems. I will describe some of the advantages of the solution I will present. Also, virtualized computers are not only cheaper in the long run and the short run, but I am more secure and flexible for your school.

It doesn't matter whether you are in a high school, college, or even if you're middle school. This type of infrastructure can benefit you and help you meet many of your needs, from security to budgeting.

Credit: Medium

Issues with gaming infrastructure in schools

So let's talk about how computers look today. When I tour most campuses, I walk into a room and see between 12 and 50 computers sitting on a desk with lots of cables taking up lots of space. These big heavy computers on desks are tough to move and manage.

Schools keep the computers in that one place and don't move them. They lessen the workspace for the game, whether underneath the desk or on top, taking up real estate. Schools often have a way of taking the systems around campus or packing them up for a long trip, but this as you will read as many issues to it as well.

Another issue with having a significant giant heavy asset that costs you a lot of money is sitting on a desk next to one of your students. Most of your students will treat your hardware respectfully and not steal or damage it, but some will.

I have seen cases where computers end up with someone's twitch sticker. Or others where people download a game, and it turns out to be loaded malware. You now have illegal, stolen software on your campus computers. This malware can spread across your campus network, leading to many security issues and the closure of your game center.

Other issues are that the students could steal some of the hardware from your systems; this happens more often than you'd think. Still, more problems are with kids mistreating the equipment. They can often get upset after a defeat and hit the hardware destroying a big expensive computer and causing you to have costly repair bills. I've even heard of instances where kids have removed some of the hardware from the systems.

High infrastructure costs

These systems are expensive, upwards of $2,000.00 to $3,000 at a minimum. Some schools could spend as much as $5,000.00 to $10,000.00, depending on the system's hardware. Not to mention the expensive cost of software such as operating systems, games, video editing software, plug-ins, and other yearly fees associated with a workstation. 

The budget for most schools' gaming departments is not very big and can drain your budget. The annual cost to maintain just a single windows PC is about $400.00 to $800.00 a year per system at education pricing. For example, Windows is $100.00 for each workstation, and there are many other expenses.

Most schools don't have a way of monetizing their esports teams, so having to buy 12 computers at $5,000 each is a minimum of $60,000, and that's just the PCs. This doesn't even include all the monitors, keyboards, network switches, cabling, cameras, headsets, microphones, and so on you will need.

Tracking and moving valuable assets

How does your school track these assets? It isn't straightforward for a school to keep track of the gaming systems. Schools usually track systems if their value is $500 or more. The school name generates a sticker placed on the design and has requirements for where the system can reside.

This causes an issue if you have a contest around the school, like in the theater or cafeteria, then you have to move these expensive assets all around campus. They might get damaged, lost, or stolen. Or if you do away games and need to pack the systems up to take them off campus, this causes a security issue and a lot of extra paperwork.

Credit: NorseCorp

Overall issues

Ok, so we've talked about the problems with this workflow. We spoke about the security issue of having to manage an expensive computer. This computer is tough to move in and migrate around campus for away games. Having kids damage, steal, or infect your systems with harmful malware or stolen software is difficult. 

The very high cost usually ends up breaking the budget of some schools, causing most schools to cancel or not have any sports programs on campus. Even if you get a company to sponsor your Esports program and give you a discount cost, a system doing maintenance costs is usually prohibitive for most esports programs.

Previously I've discussed the issues I have with putting computers in your gaming center. There are some definite advantages to having a large computer available for students to play on. In the past and currently, most games are downloadable to your computer and are open to play locally.

Advantages of high spec computers

The only thing that's done virtually when you download a game is the interaction with other players and the changes to the maps or the gameplay area caused by players interacting with the environment. For example, if a player in South Korea blows up a tree on the island in Fortnite, that item is no longer on the map. 

Having the game on your computer will allow you to take advantage of some of the high-end equipment and your system. For example, suppose you have a graphics card on your computer with a lot of RAM (Random Access Memory). In that case, this will allow you to gain faster regeneration of your video and drive more extensive, higher resolution monitors.

Adding more RAM can boost system responsiveness and improve frame rates compared to systems with less memory. Multiple processor cores and hyper-threading technology are virtually essential in gaming and everyday computers. Multiple processor cores allow you to increase productivity at work, play complex video games, or explore a new world with virtual reality.

The power of cloud computing

Now to the solution that we believe will be the future of where gaming is going. This goes by either cloud computing or virtualized workstations. Let's define what I'm talking about with cloud computing and virtualized systems and what the differences are other than the spelling. 

Cloud gaming, at its core, is the ability to separate the technical power required to play a video game from the device it is being played. That is accomplished using remote data centers, which harness a company's processing power and stream a game directly to a user's device.

Cloud computing is when you use a Terminal or any computer or device to connect over the network, which connects to a data center to utilize the systems, storage, and network infrastructure for a nominal fee. It can get a lot more complicated, but this is the basics. 

Companies like Amazon web services, Azure, Cyxtera Technologies, Coresite, and others have spent hundreds of millions a year to build out cloud computing infrastructure systems and maintain them. They will then charge you a monthly fee to access the system anytime. The more that you use it, the higher your cost. A lot like renting an apartment. 

The apartment manager maintains a property, fixes any issues, and charges your monthly rent. The difference in the property is that you gain equity if you own a property. If you own a computer, it depreciates and costs much more to enter, so there are none of the benefits associated with owning a home as opposed to renting. The good news is that cloud uses are being used much more, so the cost has decreased. It's one of the only things where the price is not increasing.

Cloud computing vs Virtual systems

The difference tween cloud computing in a virtual system is cloud computing, and you can use any device such as a notebook, tablet or iPad, or even your phone to connect to the server. With a virtual system, you get a specially designed Terminal with a high bandwidth connection to the server.

It also has a tiny inside, no hard drives, and doesn't even have a standard OS. This brings most systems to between $50 up to about $500. These terminals include a monitor, keyboard, mouse, headphones, microphone, and networking ports that you can plug into all your peripherals. Then you can link to a virtualization computer with a company like Amazon Web Services or another data center system for a minimal monthly cost. 

Because they are under $500, most schools don't track the terminals as assets. And you don't have to worry about someone stealing it because it just doesn't do anything if they don't have the right connections, as there are no hard drives inside it for the steel.

Another significant benefit of virtual I systems is that they are much smaller and lighter than a general PC. Even if you get one of these small-contained PCs, they usually weigh about 8 to 10 pounds, and most PCs, on average, weigh about 25 to 30 pounds. 

So you can pile them in a box because they are minimal, about the size of a 6-inch pizza, and move them anywhere around campus with little issue. You are connected by plugging them into your campus network jacks or switches.

Credit: Nasdaq

Why isn’t everyone using cloud computing

So we've talked about the benefits of virtualized and cloud systems. We discussed that they cost over 50 times less than the standard gaming PC, with no expensive ongoing maintenance software or IT costs associated with on-premise computer systems. We also discussed how they linked to the plans at the data centers.

So why is not everybody running out to buy this if it is so much better? The biggest issue is education and people not understanding how incredible cloud systems are; the cloud is the future of global technology.

You are already using cloud systems right now. When you load up games like Fortnite, League of Legends, Dota 2, Halo, and others, you are linking to the gaming servers for these companies, which primarily run the game off the cloud systems. Yes, you can load the game package on your personal computer, but it requires you to connect to the server and link back to where the game is hosted.

So let's dive deeper into cloud gaming, where it is today, and where I think it will go over the next few years. Cloud gaming incorporates most gameplay into data centers, taking them outside the facility, home, or school. Whether operating at a small facility or a large one like Amazon Web services, these extensive data facilities usually consist of hundreds, if not thousands, of racks of computers.

Latency issues

Some are the same consumer systems you may buy, and some are more professional grade workstations used by visual effects artists and video editing artists. One of the most significant components of why you should have on-premise systems instead of cloud gaming or virtualized systems is latency. The computer is not right in front of you, and the data has to travel.

However, the truth is that latency can happen even if you have a computer next to you. Latency is caused when there is a bottleneck somewhere in the game stream. If you have a super-fast computer with many people playing, it can cause issues. If you don't have the same firmware, operating system software, game version, RAM, or Video Card, this can all cause latency issues.

It's not just the computers. It is also the network. Using a consumer-grade network switch with no management features can cause wait-and-see issues because the network ports can run at different speeds. Also, you can get various speed differences with the type of ethernet cable you utilize. If one person is using a Cat-5-cable and another player is using a Cat-6-A-cable, this can cause a difference in speed. Granted, it will not be much, but even 1-MS speed difference can make the difference between winning and losing in competitive play.

Using remote data centers is much better because everything is uniform and controlled by network engineers and is monitored 24/7. All the processing is done at the Datacenter, and all the computers are usually in one or two racks next to each other; you can get much better throughput. And if you think there's going to be latency because the stream has to travel miles to get to your device, you would be incorrect. Think of it as if you were streaming from Netflix or Disney. The videos are coming like a stream from your channel provider.

The future of gaming and cloud computing

This is where the future of gaming is already heading. We have seen Facebook and Microsoft heavily invest in meta-verse and online gaming. Even consoles like the Nintendo Switch, PS5, and Xbox One are all going to online packages for their games. It is cheaper for the publishers, more profitable, and less expensive for the consumer in the long run. 

Not only are they saving money on expensive computers, but they're also saving money on gaming packages. As we discussed earlier, people spend a lot of money each year upgrading and buying new games. Most often, people go out and try to buy the game, which is unavailable because the retailer has run out. You could buy a subscription for $10 a month to get the latest version of all 10 of your favorite games. This would typically cost you about $50 each, significantly saving. As far as the manufacturers, they will make more money. After all, they'll sell more subscriptions and have fewer support issues because everything runs off their control servers. They don't have to worry about piracy because it is impossible to pirate something on the server.

Existing cloud services

To this end, we see a mix of so-called "cloud gaming" services and models in-market today, only some of which are cloud game streaming.

Google Stadia Pro ($10/month) or GeForce Now ($5/month), for example, are cloud game streaming services that still require users to buy individual games (though some are free). In other words, they change how gamers access gaming hardware, but not how they access (i.e., buy) gaming content. The lack of the latter is widely seen as a critical barrier to adoption, especially given the services lack compelling exclusive content. Microsoft's xCloud is likely to resemble this model (though later in this section, bundles are likely too).  

All-You-Can-Eat (AYCE) digital game subscription services are Xbox Game Pass ($10/month) and Apple Arcade ($5/month). These services are often called "Netflix for Games," but subscribers need to download and install these games locally. However, this model will change as they entirely expose the gaming community to the benefits of cloud gaming. Accordingly, they're a version of Netflix where the only playback option was via "download to watch offline."

Meanwhile, Sony's PS Now ($13/month) is a cloud game streaming service that includes an AYCE gaming catalog. Even still, subscribers don't need to play many of these titles via cloud delivery - they can also be downloaded for local processing. The vast majority of PS Now playtime is via local installs.

Sony and Microsoft have also suggested that physical console owners who buy a la carte games can stream those games to other devices at no additional fee.

So today, companies like Disney, Microsoft, and Facebook have announced that they will migrate to an online cloud delivery system in the next three years, and I will start deleting their games' retail packages. Companies like steam, epic games and others have also announced that they will be migrating entirely over the next 5 to 10 years off retail gaming. So, in the end, everybody will be forced to go to cloud-based gaming.

This model extends into "direct-to-consumer" video services too. When a customer buys HBO Now from Amazon Channels for $15, Amazon keeps ~$5 to manage delivery. When a customer buys HBO Now direct from HBO, the company charges $15 and spends several dollars on its delivery costs. 

Increasing customer choice

It is, however, technically possible to unbundle these products. Imagine, for example, sending Amazon $15 per month for the ability to watch content through Amazon Video and then adding the likes of HBO for only $10. Stranger still, you might go to, buy HBO for $10, then need to connect it to a paid technology provider (e.g., MLBAM or Apple TV+) to watch it.

The unbundling of content, access, and services is expected in gaming due to the diversity of parties and technologies needed to enable online multiplayer experiences. Accordingly, consumers are not just used to paying multiple parties. They've even come to accept paying the same party numerous times. 

You have to buy a PlayStation console from Sony and then a PlayStation game from Activision, Sony, or another party to have something to do with your Console. And if you want to play multiplayer, you need to buy the monthly PlayStation Plus subscription from Sony. Sometimes, you must pay the publisher a monthly content subscription for their game.

In the future, the only difference will be whether you will provide gameplay on a tablet, primary computer, Chromebook, or a Virtual Console. The benefit of the virtual Console is that it has many connections for your headphones, microphones, monitors, and other USB devices and has a high-end network connection. And as I said earlier in the article, it is much easier to control and very inexpensive to buy.

High end server hosting issues

Server-side rendering, however, is costly. GPUs (Graphics Processing Unit) is expensive, and data centers have notorious heat and electricity requirements. It's one thing when a game console is at home by itself; it's another when it's sitting in a rack with many others. It generates tremendous amounts of heat from its graphics cards. Most estimates suggest at least $0.35-40 per user hour. This means that just the direct marginal server costs of 20 hours of gaming are $7+.

Cloud game-streaming also has fewer opportunities to achieve "scale efficiencies" than most cloud-based content solutions. Players cannot be too far away from a remote data center, or latency increases to the point of intolerability (see above - this is also why multiplayer typically sorts players on a regional basis; there's too much latency from greater distances). This means a cloud game streaming service can't just have one "hyper-scale" data center. Many locations are required around the country and globe. This requires enormous capital investment and makes implementing upgrades and technical fixes harder.

Furthermore, cloud game streaming servers spend most of their life with excess capacity due to the need to "plan for peak" demand. If 75,000 players use a service at 8 PM on Sunday, the local data center must support 75,000 players. At 4 AM on Monday, however, there might be only 15,000 players, and thus 80% of capacity goes unused. At most times, less than 40% of these racks would be used. As a consumer, you can purchase a $400 GPU and let it sit offline as much as you want, but data center economics are oriented toward optimizing for demand.

Types of cloud streaming

A Cloud Streamed Game is a game that can but need not be played via cloud processing. An example here is Resident Evil 7. The game is available via cloud game streaming on the Nintendo Switch (which lacks the processing power to play it locally), but it can also be played as a locally processed game on PlayStation 4, Xbox One, etc.

A Cloud Only Game is a game in which cloud processing is the only option available to a consumer. An example might be if Google Stadia bought exclusive rights to Resident Evil 8, a title currently planned for most major 8th and 9th generation consoles. In this sense, consumers could have played this title through local processing but are not given that option.

What's interesting is Cloud Required Games are games that can only be played using infrastructure, computational power, or technology that no consumer could afford or a consumer device offers. In a simplified sense, they are the games that only a "supercomputer" composed of interconnected racks of industrial servers might run (Amazon CEO Jeff Bezos describes these sorts of games as "computationally ridiculous").

All cloud-based servers face the challenge of optimizing for utilization. This is why Amazon Web Services (AWS), for example, gives customers a reduced rate if they rent servers from Amazon in advance ("reserved instances"). Customers are guaranteed access for the next year because they've paid for the server, and Amazon is pocketing the difference between Amazon's cost and the customer's price. AWS's cheapest Linux GPU reserved instance (equivalent to a PS4) costs $2,709 for one year before video bandwidth.

Why you should embrace cloud computing

Cloud computing has so many benefits. You have no downloads or patches to updates, no expensive hardware to buy and maintain, and you do not have to worry about whether your devices are compatible. Also, whether you have better or worse hardware than the other player, being able to multi-platform anytime, with a broader distribution of games. It also creates more accessible access to tournaments; these are the main reasons we think that cloud gaming will be the future. 

Anybody who is not embracing this today is fooling themselves. It is also better to welcome the newest technology at school as you'll be training your students on what is coming instead of what is in the past. Like in Broadcasting, most schools are teaching their students in IT broadcasting instead of traditional Broadcasting. This refers to shifting away from SDI (serial digital interface) connections to a network interface where all broadcasters are switching. Instead of buying a lot of expensive switches, routers, and other hardware, most broadcasters are migrating towards a cloud-based editorial by picking the apps they want for their broadcast.

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