Source: Respawn Entertainment

One of the most anticipated games of the year, Titanfall, developed by Respawn Entertainment and published by Electronic Arts (NASDAQ:EA), serves as an important exclusive title for Microsoft's (NASDAQ:MSFT) Xbox game consoles. However, the game's online-only nature, coupled with its heavy reliance on Microsoft's Azure cloud-computing infrastructure, means that problems in the cloud could potentially render Titanfall unplayable. The launch of Titanfall on March 11 came with some problems as many gamers could not play the game, which added to a growing list of online games that have launched with major technical problems over the past year.

This development certainly did not offer good news for Microsoft. With its Xbox One console well behind Sony's (NYSE:SONY) PlayStation 4 in terms of sales, the frustration behind the launch could push even more gamers to Sony's console. As for EA, which botched the launches of SimCity and Battlefield 4 last year, another troubled launch is the last thing that the company needs. While Titanfall's problems seem less severe, the frustration with online-only games makes the industry's current direction look questionable.

What this means for Microsoft
Microsoft's Azure cloud platform provides the Xbox One with an unique advantage. Microsoft has been offering developers discounted access to Azure for running game components, and Titanfall developer Respawn took full advantage of this by using the cloud computing platform to calculate the behavior of in-game enemies and host multi-player matches. While this allows processing power on the Xbox One to be dedicated to other things, like improved graphics, it comes at the cost of tying the functioning of the game to the stability of Azure.

Source: Microsoft

The problems with Titanfall's launch appear to have mainly happened on Microsoft's side of things. Xbox Live went down on launch day, which prevented some players from even logging in, and players who did manage to get through faced other problems. The power and scale of Azure had been intended to prevent these types of issues, but it seems that the incredible hype surrounding Titanfall resulted in too much of a burden for the system.

As Titanfall had served as a test case for using Azure for critical in-game functions, the problems surrounding the launch could deter other developers from taking advantage of Microsoft's cloud computing platform. Azure has the potential to provide additional processing power that would give the Xbox One a much-needed advantage over the PlayStation 4, but these technical problems make relying on Azure a risky proposition for developers. If Microsoft can fully resolve Titanfall's problems quickly and Azure proves stable from here on out, then Microsoft may have a meaningful edge over Sony in the console wars. However, if these problems drag on then Microsoft will likely not see any advantage at all from Azure.

What this means for EA
While EA does not appear responsible for Titanfall's problems, the company's recent history of botched launches makes it a target of the frustration felt by gamers. Back in March of last year, EA's online-only reboot of the classic SimCity series launched while plagued with server issues that prevented paying customers from playing the game for days. It took nearly a year for the company to commit to releasing an offline version of the game, and this delay in combination with the launch issues may have killed any chance EA had of successfully rebooting the series.

Battlefield 4 resulted in another disaster for EA. The game launched with severe technical problems that prevented many players from playing online at all, and some of these issues remained months after launch. EA delayed future games in order to deal with these problems, and any chance at dethroning Call of Duty was lost.

The Titanfall launch issues likely come as the last thing that EA wanted, although they appear less severe than the previous problems with the Battlefield launch. It's clear that EA would like Titanfall to become a franchise, which would give the company more ammunition to battle the Call of Duty juggernaut. One issue is that Titanfall has no single-player mode at all, meaning that it is completely useless if Azure is having problems. At the very least, Battlefield 4 had a single player mode, so the game could be played amid all of the server issues.

EA's choice to make SimCity online-only backfired severely, and if Titanfall's problems persist a similar result could occur. Online-only offers a fine proposition as long as it works, but the moment gamers can't play the game for which they paid $60, the reputation of the franchise suffers. The Battlefield franchise certainly took damage because of the technical problems, and Titanfall risks suffering the same fate. If EA wants to build a franchise that has the success and staying power of Call of Duty, it needs to ship games that work.

The bottom line
The Titanfall launch resulted in a bit of embarrassment for both Microsoft and EA. Azure had been intended to solve the problems plaguing previous games, providing vast and scalable processing power, but it's clear that Microsoft had not quite worked out all the kinks with the service. The list of troubled launches has grown larger for EA with Titanfall, although the company's reputation can't really get much worse at this point. Although Titanfall's problems may be short-lived, the question remains open as to whether gamers will continue to tolerate botched launches of online-only games. If not, Microsoft's advantage with Azure may not mean much at all.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.