Hello, and welcome to Protocol Entertainment, your guide to the business of the gaming and media industries. This Friday, our newsletter is all about Sonos embracing gaming as a new way to grow its audience, and what that tells us about larger shifts in the video game and consumer electronics industries.

Sonos is a game hardware company now Sonos has long been a hit with music lovers. The smart speaker maker has also made significant inroads in the living room, thanks to the growth of Netflix and other streaming services. And recently, Sonos has started to target yet another group of media lovers: video gamers. Embracing gaming is a subtle shift for Sonos, but it’s one that could help the company expand its audience beyond the people traditionally interested in multiroom audio. It’s also part of a broader shift in gaming, where cloud-based technologies could empower TV makers and others to play a much bigger role.Sonos introduced its first sound bar close to a decade ago, and people have been using the company’s devices for games ever since.“When we think about immersion, gaming is always top of mind,” Sonos’ vice president of product program leadership, Jeff Derderian, recently told me. “This is a whole genre that's based upon immersing someone into an environment, into an experience. Sound has always been a critical aspect of that.”“This is something that people have been enjoying,” he said. “It is a focus for us.”However, for the longest time, the marketing of the company’s sound bars almost exclusively focused on movies, TV shows and music streaming. “I think [gaming] isn't something we've talked enough about,” Derderian admitted. That is starting to change this year. Sonos began marketing its budget-priced Ray sound bar as a “small HD gaming sound bar,” and has been featuring game controllers and people playing games throughout its promotional materials.Sonos even told prospective buyers that the Ray features “an optical connection for TVs and PC gaming.” Suggesting that its speakers could be hooked up directly to gaming PCs is new for the company.Derderian also made a point of mentioning gaming as a key use case for the company’s new Sub Mini when he briefed me on the device.And he acknowledged that the company’s language around gaming is changing. “This is just a bit of a shift in the way we talk about things,” he said.Part of this shift is just a necessary response to an unpredictable and at times rocky market. Sonos has been trying for some time to expand its audience with new products, including portable speakers and the cheaper Ray sound bar.However, Ray hasn’t sold nearly as well as the company expected; Derderian blames declining TV sales as one reason. Marketing the device as something you can also connect to your gaming PC makes sense in that context. Sonos embracing gaming is also part of a bigger shift. The game industry itself is changing, and those changes are opening up new opportunities for the consumer electronics industry.The biggest such shift is cloud gaming, which has the potential to turn ordinary smart TVs and streaming dongles into cloud-powered game consoles that are capable of playing AAA titles without expensive hardware.Cloud gaming initiatives like Google’s Stadia may have struggled, but there’s clearly some momentum pulling in that direction, and hardware makers like Samsung are looking to benefit from it.Even Sony and Microsoft are starting to realize that the console wars aren’t the future.However that shift to cloud and cross-platform ultimately plays out, the beneficiaries are likely going to be the makers of a whole range of devices, including phones, smart TVs and streaming sticks, and yes, even sound bars. “It's not a story that we've told a lot. We should change that,” Derderian said. Sponsored content from Modern Treasury Software is changing payments and banks should care: At Modern Treasury, we built a platform to complement banks’ existing products to help them prepare for a future led by software. We’re here to help them future-proof their business so that they can participate in and lead in the next phase of financial services. Read more from Modern Treasury

Sonos has long been a hit with music lovers. The smart speaker maker has also made significant inroads in the living room, thanks to the growth of Netflix and other streaming services. And recently, Sonos has started to target yet another group of media lovers: video gamers.

Embracing gaming is a subtle shift for Sonos, but it’s one that could help the company expand its audience beyond the people traditionally interested in multiroom audio. It’s also part of a broader shift in gaming, where cloud-based technologies could empower TV makers and others to play a much bigger role.

That is starting to change this year. Sonos began marketing its budget-priced Ray sound bar as a “small HD gaming sound bar,” and has been featuring game controllers and people playing games throughout its promotional materials.

Sonos embracing gaming is also part of a bigger shift. The game industry itself is changing, and those changes are opening up new opportunities for the consumer electronics industry.

“It's not a story that we've told a lot. We should change that,” Derderian said.

Software is changing payments and banks should care: At Modern Treasury, we built a platform to complement banks’ existing products to help them prepare for a future led by software. We’re here to help them future-proof their business so that they can participate in and lead in the next phase of financial services.

Read more from Modern Treasury

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