Project Keystone: Microsoft's cloud gaming dongle is still in development
Back in 2020, mentions of the first Xbox-branded "cloud gaming stick" showed up online. Nothing came of that rumour until today. Jez Corden of Windows Central has heard from industry sources about a Chromecast-like device tailor-made for cloud gaming. It is codenamed "Project Keystone" and has been in development for a while.
A Microsoft official has told Windows Central that Project Keystone aims to make gaming more accessible to the masses. Given its form factor, it will probably run a low-power ARM chip and a custom OS, relying on Xbox Cloud Gaming to do all the heavy lifting. Microsoft could also load it with popular streaming apps to make it a rudimentary Chromecast/Stadia competitor.
However, it could be a while before Microsoft unveils the cloud gaming device. Xbox Cloud Gaming is itself in infancy, and it'll be a while before Microsoft can roll it out worldwide. Besides, cloud gaming has its inherent disadvantages, such as high latency and high bandwidth requirements, and many gamers would rather get a secondary console instead of relying solely on the cloud.
While one would still be better off sticking to consoles for high-fidelity AAA games, a streaming stick could come in handy as a secondary or tertiary device earmarked for indie titles. Microsoft will likely price it in the US$60-70 region, a little over a 4K-enabled Chromecast/Fire Stick. One can only hope that an Ethernet port is included, as Wi-Fi isn't particularly ideal for cloud gaming.
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