In a move that is sure to raise plenty of eyebrows, and worry Stadia supporters, Google has announced they're shutting down SG&E (Stadia Games & Entertainment) and no longer doing first-party games.
They make it clear in the announcement that Stadia as a platform isn't going away, and they believe game streaming is "the future of this industry" and so they will "continue to invest in Stadia and its underlying platform to provide the best cloud gaming experience for our partners and the gaming community". It gets more interesting though, as Google said they will be expanding to "help game developers and publishers take advantage of our platform technology and deliver games directly to their players" and they will be working with partners who want a streaming solution.
Google clearly mention how costly it is to create big AAA games, and as Amazon have seen it doesn't always work out and burns a lot of money. Instead, the focus will be to "focus on building on the proven technology of Stadia as well as deepening our business partnerships" and on that note they mentioned that Jade Raymond has left Google now too.
Sounds like Google are going to be licensing the tech and hardware behind Stadia, while continuing to build up Stadia as a store itself. It makes a lot more sense, as big costly exclusives from Stadia for Stadia won't have enough of a pull to pay-off, whereas pulling in more and more 3rd party popular games will and would cost Google less to do. So, it is the smart move overall. The Stadia tech is good too, and it clearly works so they're doing what they do best in this way.
The thing is, it's another nail in the coffin of the idea Google sold it all on originally. The talk about these huge games that could only work in the cloud, which you're not likely to see from a 3rd party developer since their games will need to run on PC and consoles too most of the time.
So don't expect any Google / Stadia first-party titles after this year, if any of them come out at all. To be clear though, Google note they are "committed to the future of cloud gaming, and will continue to do our part to drive this industry forward" and that the Stadia store will continue bringing in more titles. Still, it won't stop people mentioning the Google Graveyard.