While latency-sensitive actions will be handled by a user's Xbox One console, Microsoft claims its cloud architecture can pre-calculate elements like lighting and physics modeling, leading to increased in-game performance.
This additional processing is made possible by the 300,000 servers that will power Xbox Live after the Xbox One's launch, up from the 15,000 servers currently supporting the service. Booty notes that "[for] every Xbox One available in your living room we'll have three of those devices in the cloud available."
Xbox One games that support the feature will remain operational in the event of an Internet connection outage, though developers will need to address the possibility of reduced performance. "In the event of a drop out [...] the game is going to have to intelligently handle that," Booty tells Ars Technica.