The Observer is a god-like, sentient being who watches over the planet Xsarra. He is ghost-like in appearance, and is seen outside the atmosphere of Xsarra.
The Observer has been watching over Xsarra for at least 3000 years. He witnessed the arrival of humans 3000 years prior to The Unholy War. The humans had travelled to Xsarra from Earth in crude, generational starships; these were fuelled by what little drained AUR fragments were left on Earth.
The Observer later witnessed the arrival of the technologically advanced Teknos, who immediately began fighting the Arcane natives. He has been following the "holocaust" carried out by the Teknos from afar for 500 years. He describes the conflict between the Arcane natives and the alien invaders as an "endless, unholy war".
- It is never revealed exactly what the observer is, other than a watcher. He isn't placed as an Arcane or Teknos, so it's safe to assume he does not support either side, but is only watching silently.