Sony and Microsoft, bitter rivals in the video game console wars, will team up in on-demand gaming to better compete with newcomers like Google as the industry’s main battlefield looks poised to shift to the cloud, news outlet Nikkei reported Thursday. From a report: Sony President and CEO Kenichiro Yoshida has signed a memorandum of understanding with Microsoft CEO Satya Nadella on a strategic tie-up. While details have yet to be hammered out, the partnership will center on artificial intelligence and the cloud. The latter category includes plans for joint development of cloud gaming technology. While this market is expected to grow as ultrafast fifth-generation wireless gains traction, such services require much processing power on the provider’s end to deliver games with high-quality graphics and minimal lag. Sony and Microsoft plan to leverage the American computing behemoth’s data centers for this purpose. The two companies, along with Nintendo, long dominated the gaming landscape. But the rise of mobile gaming has brought competition from such other players as China’s Tencent Holdings, which publishes the mobile version of the wildly popular PlayerUnknown’s Battlegrounds (PUBG). Press release: Sony and Microsoft to explore strategic partnership.