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Lack of investment blamed for death of subsidiary opened in late 2014

Square Enix closes cloud gaming arm Shinra Technologies

The prospect of cloud gaming has been dealt another blow.

Square Enix opened its cloud-focused division Shinra Technologies – named after the eponymous company in Final Fantasy VII – back in September 2014, with former Square president Yoichi Wada taking the reins.

Among the firm’s aims was the creation of a ‘virtual supercomputer’ to power ‘radically new experiences’ backed by the cloud.

Square Enix originally sank $16 million into the forward-looking arm.

However, less than two years later, Shinra is predicted to record a loss of $16.8 million for the fiscal year ending March 2016.

It had sought investment to fund its continuing research and operations, but failed to attract third parties on board.

As a result of its continuing struggle, Shinra has now been announced for closure by Square Enix – despite the parent company’s reassurance that it still has “confidence” in cloud-based gaming.

"[Shinra], as a cloud platform operator, has been trying to raise funds necessary for further business operations from third party investors," Square said in a statement.

"However, it has found no prospective investors at this point, and therefore has to discontinue its business."

Shinra’s closure follows the death knell of another high-profile cloud gaming flagbearer in 2016, after OnLive shuttered last April.

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