Microsoft is Building a Cheap Xbox for Streaming Games

Microsoft announced back at E3 last month that they are working on a new low-cost Xbox, which will stream games from the cloud rather than processing them on local hardware.

The company says that they will be making an update to their Xbox One X, plus they will also bring another console known as “Scarlett” that will be a cloud gaming console.

How Scarlett Works and its Benefits

Traditional gaming consoles have hardware that runs games locally, while cloud gaming (Scarlett) relies on cloud servers for processing and you can simply stream them on your screens.

Scarlett will have a limited amount of power in terms of hardware (will have a low-end CPU and GPU etc), which is all it needs to perform local tasks such as syncing save files or another non-game related console stuff. The good thing is, it feels exactly like how you normally play games on consoles like the Xbox One or PS4.


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This reduces the price of hardware for Scarlett as the traditional consoles require up to date GPUs, CPUs, RAM etc. It even reduces the size, weight and power consumption of the console, dramatically reducing its overall impact and footprint.

Microsoft will let you play these cloud-based games on your phone, tablet, laptop etc. Microsoft themselves have confirmed they will be making Scarlett Cloud accessible across all devices.

Potential Drawbacks

There are a few factors that can be potential deal breakers:

  • It needs a good internet connection.
  • Controls will feel a bit sluggish due to high latency and framerates will be low.
  • It will bump up the price of game streaming and online services.
  • Only small-scale, limited games will be available, it won’t be able to rival traditional consoles in terms of quality.

Microsoft’s Plan

Microsoft seems to be confident about cloud gaming, as they believe that they have figured out a way to handle the latency sensitive aspects of gaming. There would be some part of the game that will be processed locally instead of completely processing game over the cloud.

We already know that Microsoft typically doesn’t make much money out of selling their hardware. They mainly earn from their service like Xbox Live, Xbox Gamepass and by selling games. Increasing the price of services where you actually earn big (Online) and lowering the price of the hardware is a win-win scenario for Microsoft.

Scarlett will come sometime after Xbox One X’s successor launches in 2020.