Sony acquires online company Gaikai for cloud game strategy

— -- Sony is taking its video games to the cloud.

The electronics giant has agreed to acquire online game-streaming company Gaikai for about $380 million and has plans to establish a new interactive gaming cloud service.

Gaikai, founded nearly four years ago, is often described as a "Netflix for gaming," because it offers an on-demand library of video games streamed online and to devices.

Sony and Gaikai offered few details in how the service might be integrated with Sony's current PlayStation 3, PlayStation Vita handheld system and online PlayStation Network. Nor was there mention of what was expected for the successor to the PS3 and PlayStation-compatible smartphones.

The planned service will include casual games as well as "immersive core games with rich graphics," Sony Computer Entertainment President Andrew House said in a statement. The company declined to comment further.

Unlike cloud gaming competitor OnLive, which touts its subscription and on-demand games options directly to consumers, Gaikai has focused on helping game publishers give consumers a chance to try games before they buy online.

Earlier this year, Gaikai brought a selection of free game trials to Facebook. Once users complete the free portion, they are directed to a publisher or game retail site where the full game can be purchased.

"We're honored to be able to help (Sony) rapidly harness the power of the interactive cloud," said Gaikai co-founder and CEO David Perry.

Sony's acquisition helps position it to compete with free Web-based games and with Apple and Google, which are bringing games to Internet-connected TVs, says M2 Research analyst Billy Pidgeon. "The cloud is going to play an increasingly important role in gaming."

Bringing easy-to-play cloud games into Sony TVs could help lift sluggish set sales, says Wedbush Securities analyst Michael Pachter. The deal also eliminates a direct competitor to console video games. "I think they have to integrate Gaikai as part of their console strategy," he says. "It will be complementary to, rather than a substitute, for console gaming."

The Sony-Gaikai deal might eventually be as influential as Apple's iTunes launch, says Paul Hsiao, partner at venture-capital firm NEA, which last year invested $13 million in Gaikai: "It just opens up all kinds of possibilities for business models."