Microsoft is developing a Netflix-style streaming video service for video games. It promises to deliver "console-quality gaming on any device'.
The Redmond-based company claims that gamers will be able to stream blockbuster films to their Xbox laptop, computer or smartphone.
It's unclear whether players will be required to pay for individual games, or will be capable of accessing the entire library for a monthly fee like video on-demand services.
Microsoft does not believe that streaming will completely replace dedicated consoles, but the company teased that a new Xbox hardware was in the in the works.
Microsoft is developing an online streaming service similar to Netflix for video games that is expected to bring 'console-quality gaming to any device'. In its E3 presentation, Microsoft revealed 50 new games to fans - an unprecedented feat for the Redmond-based company.
Phil Spencer, Xbox boss, teased the future video game streaming service, which he said will allow gamers to play console-quality games on any device.
Microsoft's Executive Vice President of Gaming Phil Spencer spoke at the E3 press conference in Los Angeles to reveal its plans to develop cloud-based service.
Spencer said that: "Our cloud engineers are developing a game streaming network for console-quality gaming on all devices.
"We are dedicated to improving your gaming experience everywhere you play - on your Xbox or PC and even on your mobile."
This approach, known as Cloud Gaming, allows players to access a huge library of games without having to download or install each individual game.
Cloud gaming can allow console-quality video games to run on less powerful devices, such as smartphones, as all the heavy lifting is handled by a server, not by the device used by the player.
This is very different than traditional console games that must process all data on the disk locally and therefore require high-end chipsets.
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Xbox director Spencer hasn't revealed an exact date for the launch of the service during his presentation, but he has previously teased that Microsoft's game streaming could be available prior to 2020.
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The company is not the first to express an interest in a game streaming service as rival PlayStation already offering gamers the chance to stream titles to their devices.
PlayStation Now is a subscription service that costs PS12.99 ($20 per month) and lets users stream more than 500 titles to their PlayStation 4 or Windows PC.
After it purchased rival services Gaikai, OnLive, and Sony, Sony launched its cloud gaming platform.
But despite its emphasis on streaming video games, Microsoft has not abandoned its hardware plans.
It is not clear if users will need to pay for individual titles or if they will be able access the entire library for a flat monthly fee, much like Netflix.
But despite teasing streaming services, Microsoft revealed plans to continue building Xbox hardware, with new 'consoles' already in the works
Xbox boss Phil Spencer remained tight-lipped on any specifics about the forthcoming console, however, the executive did reveal that backwards-compatibility with older video games would play significant role for the new hardware
Phil Spencer used the E3 keynote to tease the follow-up to the Xbox One, with hints that Microsoft could have multiple new consoles planned.
'The same team that delivered unprecedented performance with Xbox One X is currently deep into designing the next Xbox consoles, and we will once again deliver on our commitment to set the benchmark for console gaming,' he added.
Spencer remained tight-lipped on any specifics about the console, however, the executive did reveal that backwards-compatibility with Xbox One games would play significant role for the new hardware.
Eurogamer was told by him: "When you think about the next generation of hardware, many of the big, massive games currently played will be around when the next hardware arrives."
There isn't an "2" in the middle of these games, because people are trying to guide you to the next version. In the old model of games shipping playing and going away the console switch was a simple function to perform.
"We went through it in Minecraft. We didn't release Minecraft 2 on Xbox One to try to force everyone to switch to the next console, because this isn't what Minecraft users want. They want Minecraft to get better.
"When you think of games like Fortnite or PUBG you think of the vast ecosystems and games that will be out there, when new hardware arrives players will want to play these games, and it's important for us to be able to support them.
Microsoft has revealed Halo Infinite, a new installment in the popular Halo series. It will be available on Xbox-branded consoles
Elsewhere, Microsoft showcased a record 50 new games for gamers during its E3 presentation.
The company took the wraps off of a selection of exclusive titles, including new entries in its Halo and Gears of War series.
Spencer has described the company's "most diverse gaming portfolio" as the new list of games.
