Prior to the release of Modern Warfare 3, most, if not every Call of Duty title supported “listen servers”, a technology which allowed players from diverse locations to connect to a central server hosted by a server hosting company or by servers owned or leased by Activision itself.
Through listen servers, players could rent their own game servers to host their titles. Many other games, including Battlefield 3 and Counter-Strike Global Offensive still support this sort of gameplay, allowing for players the convenience of never having to deal with the host’s latency. No player, therefore, was afforded the unfair advantage of having a better connection than anyone else.
This all changed for the Call of Duty series with Modern Warfare 3’s implementation of peer-to-peer networking. The system hosted games on players’ own connections, and relieved both the developers of the responsibility of hosting games. The cottage industry of server hosts lost a good chunk of revenue from this drastic measure, which also introduced a whole slew of problems into the multiplayer mode.
The biggest reason Activision would provide for switching over to peer-to-peer networking, at least on the console, was to cater to how Microsoft has their Xbox Live service set up, though it begs the question as to why other games including Battlefield 3 are more than capable of offering dedicated servers even on the PS3 and Xbox 360 versions of the game.
But to get down to it, the biggest reason the studio opted to do away with dedicated servers was to save money, as leasing servers costs money and ensuring that everyone has a good connection to the server by purchasing servers in just about every location deducts from the company’s profit margins.
Black Ops 2 is unlikely to offer any changes, so don’t expect dedicated servers to come back to Call of Duty any time soon.
