Update: It's been established that Gaikai has registered domains for Playstation-Cloud.com, Playstation-Cloud.org, and Ps-Cloud.net, giving further credence to the rumours that Gaikai will be involved in Sony's next console. (Thanks, Superannuation.)

Original story: Earlier this week an EA exec hypothesised that next generation of consoles wouldn't be backwards compatible, but according to the Wall Street Journal (via The Verge) the PlayStation 4 will stream older titles.

Last June Sony purchased cloud gaming company Gaikai, leading many to believe the company's next console would involve cloud gaming in some capacity. The WSJ report noted that this wouldn't necessarily be for new titles, but would rather be used to stream games from prior generations.

This is due to the upcoming console likely using AMD x86 chips, which don't mesh well with the architecture used in previous consoles. Streaming older titles would get around this problem.

As far as why Sony isn't keen on putting new games on the cloud, it's speculated that this is because cloud gaming services like Gaikai and OnLive can't yet reliably deliver more than 720p resolution - and even that requires a pretty good internet connection and close proximity to a server. Previously Gaikai was only streaming PC games, so even streaming based on the PS3's architecture could be a stretch.

This news of the PS4 streaming games is corroborated by last week's report from Japanese business daily Nikkei, which noted that Gaikai would be involved in Sony's upcoming press conference on 20th February where it's expected to reveal its upcoming console.