We see this again and again. The cynic in me sees Stadia as yet another internal promotion scheme, masquerading as a product.
I doubt this will ever change. The internal momentum of the company culture will make it so. What does it mean for investors? Google has enough money they can just buy their way into markets indefinitely. It will probably keep them going, but I don't expect huge growth. I'd probably be putting my money into other stocks if I had to choose. I honestly don't think people would miss Google much if it was gone.
"We have some of the best cloud engineers in the world, we have one of the biggest fleets of data centers. Not a lot of companies could reasonably implement cloud gaming, but I bet we could!"
That part is true! But then:
"Productization? Pricing? Market-fit? Customer service and messaging? Whatever, we've got good tech, it'll sell itself. We can figure all that other stuff out later, that's the easy part."
...cue the flop. It was always going to be this way.
When I write Stadia doesn't provide much value for AAA games, we need to look at it from both the gamer and the dev side. For gamers, if money was no object, one is better off with either a decked-out PC (better performance) or a console (wider variety). Stadia's main advantage is potentially being cheaper - which is precisely the gaming crowd which doesn't attract AAA gamedev companies.
For AAA developers, they need to port their game to a different API, then pay the Google tax, in order to appear on a small platform whose users are often drawn in by being cheap and are less likely to pay for your product.
There's no technical advantage for AAA - now that Google has closed their studios, nobody will try to make features that are only possible in cloud gaming in Stadia. If Google couldn't, can you? What happens when you ran into a problem, can you handle Google "support"?
Stadia could be good for casuals. Except it doesn't have any good discoverability features or even a search bar. Cyberpunk 2077 doesn't need discoverability, but indies or anyone searching for them really do. Its payment model (direct 'purchase', no gamepass) is OK for AAA, but not as a good for casuals. And of course, one still needs to port the game which can be difficult and relatively expensive for indies (Luna is just a VM by comparison).
Google could make Stadia better for casuals, but that means doing something less prestigious, no Google engineer will go for that, and they obviously don't understand the business model.
So Stadia is geared for AAA games/gamers, but doesn't provide good features for AAA, and even Google itself couldn't manage to make cloud-gaming-only features. Stadia can be useful for casual gaming, but the platform just isn't geared for that, and Google is unlikely to change that. Likely result is cancellation within a few years.
There are also many prestigious and lucrative engineering goals at Google that are totally untouchably intractable because money is involved. The Google Play store offers countless examples where graph algorithms and ML could identify the worst behavior for human review. If an established app is deluged by negative reviews, take a look at what’s happening. It’s either become a Trojan horse or a victim of 3rd world scamware competition. The average review for an app does not go from 4.5 stars to 1.5 stars overnight without cause!
Attempting to address this glaring deficiency leads to the following problem: the other engineers who rallied to solve it, in the past, are no longer with Google. Do you like your job? Find a technical problem with no downside, in that case!!!!!!