A lot has been made of Microsoft’s statement that their console will be more powerful because of 300,000 cloud servers on the net available for use.

As an exercise, lets calculate “the power of the cloud”

Lets assume for now that Xbox One matches 360’s first year performance on the sales charts. That gives it about 5.5 million units.

Most companies use Commodity hardware for clouds because the idea behind them is that they’re essentially disposable and used in large numbers, and prone to failure with instant failover to another node. That would be perhaps i7 Ivy Bridge levels of performance, and around 16 gigs of ram, quad core, and most clouds don’t include GPU capacity. Lets give MS the benefit of the doubt and say they’re actually using server level hardware for all 300k nodes of their cloud system. That means 8-cores of Xeon chips running at perhaps 2.8, maybe 3.0ghz, and 32 gigs of ram. Lets also give them the benefit of the doubt and say they’ve outfitted all of their cloud servers with $1000 7990 graphics cards.

Now lets have 5.5 million gamers try to use that cloud.

That gives each gamer 5% of one of these servers, roughly 1/20th. that means they’d have about 40% of a single xeon core, and 3 compute units of GPU capacity. This would be around a 25% increase to the Xbox One’s overall computing capacity… The PS4 has a 50% computing advantage. And that’s giving Microsoft a whole lot of benefit of the doubt as to the capabilities of their servers.

Then you have to remember that all this is being accessed over an internet connection. The fastest internet connection available right now to consumers is Google’s gigabit fiber. That’s 1 gigabit. Roughly 128 megabytes of data transfer. The memory bandwidth of the Xbox One is about 68 Gigabytes per second. That means that best case scenario your cloud computing is accessed at 1/544th the speed of your local memory. Average case is probably significantly lower than that, close to 1/20000th of the bandwidth of the local memory. In addition to that, their competitor has almost 3x the memory bandwidth that the Xbox One has, so it’s hard to see how they can make up for the deficiencies of their APU with cloud computing, unless they’re dealing with cloud computing of things that won’t change very often.