Rumor: Microsoft plays with cloud-based gaming, demos Halo 4 on a PC

Microsoft company officials demonstrated a prototype cloud streaming service for games during an internal meeting this week, The Verge reports.

Unnamed sources who are close to the event confirmed that officials had a streamed version of Halo 4 up and running on Windows PCs and even a Windows Phone (including Xbox 360 controller support via an attached peripheral). The demonstration reportedly ran smoothly, with latency on a Lumia 520 phone dipping as low as 45ms.

Sony purchased Gaikai earlier this year in a bid to establish a streaming service for the PlayStation 4. Microsoft previously announced that it would use cloud computing to leverage additional processing power for games like TitanFall, but has not confirmed plans for a cloud-based streaming service.

This article was originally published on Joystiq.