It's Time To Look At SIE As a Publisher First, Platform Holder Second. What Does That Really Mean?
- Thread starter thicc_girls_are_teh_best
- Start date
To me is simpler:
Play Station is bigger than a console...or better put: PlayStation won the console market. Now they need to expand because they have maximized their presence in the console space.
And as I said many times: Each market segment has its own idiosyncrasies.
Their console has been defined by "Artsy fartsy"/cinematic-story-driven/High Production values/mature games.
In order to appeal to PC , Nintendo and mobile audiences; they need to cater to those segments' sensibilities.
The fascinating thing is that MS has been doing this since around 2016. The big difference is that MS neglected their core audience, and Xbox’s identity (multiplayer experiences) became normalized across the entire industry, losing its uniqueness and relevance, compounded by the lack of quality and quantity for over a decade.
PlayStation remains a strong gaming brand worldwide. AAA single-player games have become an "anomaly"; these experiences feel few and far between, a strong marketing makes them feel like a big deal. (FOMO, zeitgeist etc...)
Right now, Hermen has been extremely clear. The LEGO Horizon on Switch is not surprising to me in the slightest. All the drama around it is coming from fanboys/console warriors.
Play Station is bigger than a console...or better put: PlayStation won the console market. Now they need to expand because they have maximized their presence in the console space.
And as I said many times: Each market segment has its own idiosyncrasies.
Their console has been defined by "Artsy fartsy"/cinematic-story-driven/High Production values/mature games.
In order to appeal to PC , Nintendo and mobile audiences; they need to cater to those segments' sensibilities.
The fascinating thing is that MS has been doing this since around 2016. The big difference is that MS neglected their core audience, and Xbox’s identity (multiplayer experiences) became normalized across the entire industry, losing its uniqueness and relevance, compounded by the lack of quality and quantity for over a decade.
PlayStation remains a strong gaming brand worldwide. AAA single-player games have become an "anomaly"; these experiences feel few and far between, a strong marketing makes them feel like a big deal. (FOMO, zeitgeist etc...)
Right now, Hermen has been extremely clear. The LEGO Horizon on Switch is not surprising to me in the slightest. All the drama around it is coming from fanboys/console warriors.
It's surprising how near-sighted these fanboys are and their predictions of doom when this is all pretty logical and sound business sense.
You even see it when they conflate revenue with operating income.
I think in the long run, Sony will have their own PC launcher and storefront and that they'll also have their own handheld, but in the meantime it makes more sense for them to get operating income that's on the table from Steam and Nintendo.
Activision was bought for 70 billion dollars (with premium). Sony is barely worth 100 billion dollars (without premium) and Sony isn't just PlayStation.
People think that Sony can just standpat and watch big tech eat their lunch, which is exactly what is going to happen within the next 10-20 years if they rely on 3rd party publishers.
Sony has a small window to leverage their position in the console space to become a leader in PC, handheld, mobile, and cloud.
Anyone who thinks otherwise should make an argument as to how Sony can prevent Apple, Amazon, Meta, Google, and even Nvidia from buying up all the 3rd party publishers.
This idea that Sony can rely on that 30% royalty forever, especially without expanding is misguided.
If I'm Sony, I need to make as much money as I can in the next 5-10 years and try to buy T2. Maybe not all cash, but cash and stock swap. Immediately giving me sports, two industry leading franchises, and Zynga.
Exclusivity deals are dead, there's zero reason to buy exclusivity against Xbox going forward, but every game that you can sell 100-200 million more by being on PC/Switch makes sense if you're trying to raise 20-30 billion dollars. Marvel's Spider-Man on Switch could probably net you over 250 million in operating income... for a game that came out 6 years ago...
sony is just trying to find more success outside the console space.
The 30% cut is all they have. Just as valve with steam.
Sony will be stupid if the damage their console business. As a market segment, they own the console space (nintendo is a handhelds console)
Remember how quickly Google bailed out of gaming. Big tech is not made for this medium. This is entertainment first and foremost.
This is dumb, there is no viable expansion to be found outside of the console, that’s an oxymoron. Selling a few more copies of a game isn’t expansion, it’s just short term stupidity. Real expansion = selling 200m consoles, anything else is just lying to yourself.
"And as I said many times: Each market segment has its own Idiosyncrasies"
Sony won the console war. PS dominates the console market segment.
They are trying to reach audiences established in other market segments. Those markets segments exists and are very well difined.
That's all wrong though, there is only 1 market and 1 audience, gamers in the gaming market. You dominate the gaming market by having the largest platform, not buy selling your games on other platforms, that's pure stupidity, no offense. The way to "reach audiences established in other market segments", is to convince them to come to your platform, that's it. Anything other than that is just conceding defeat.
Google bailed out of Stadia, that doesn't mean they bailed out of gaming.
Big Tech is coming and they have mountains of cash to burn.
Microsoft bought Activision, Amazon bought MGM and Twitch. Meta bought Oculus.
Sony has to prepare for a future where Amazon, Apple, Meta, Google, and maybe even Netflix and/or Nvidia start buying out publishers. So that they can have their own digital platforms
Sony as is will be left on a lurch by big money.
Sony has enough money to buy any of the remaining publishers. They just offered 26 billion for Paramount. They chose not to invest in gaming for whatever reason.
You're better than this.
Sony did not offer 26b for Paramount.
First, no firm offer had been extended. Second, they were bidding with Apollo Management Group a private equity firm who may have been planning on putting in as much as 13b. And then they seemed to have a plan to sell off a lot of the assets, so at the end of the day this could have been less than a 10 billion dollar investment from Sony.
The assets, IP, and scale Sony would get from Paramount would have been far more than they could get from any game company for the same amount of money.
Bandai Namco would cost at least 16 billion dollars and would give you less than you get with Paramount.
Konami would cost at least 12 billion and give you significantly less than Bandai Namco.
Capcom would cost at least 10 billion and gives you significantly less than Paramount, though I think it would be an interesting buy, it's probably not really worth it.
On the lower scale you have
Square Enix which would cost at least 4.5 billion and CDPR which would cost at least that much as well. CDPR would be worth a lot more than Square Enix even though they don't own their own IP. UbiSoft would be in the same ball park, as would Sega.
Kadokawa would be 3.6 billion at least but maybe it makes more sense to just buy FromSoftware. Sony already owns pieces of both.
Sony is working with NCSoft who would cost about the same.
I think Sony's biggest targets at the moment would be
1. Kadokawa/FromSoftware
2. Arrowhead
3. NCSoft
4. StudioGobo/Keyword Studios
5. S-Games
Sony probably has 3-5 billion worth to invest in SIE over the next 3 years and I think we'll see at least 1 of these purchased in the next 5 years.
Finally, someone with common sense around here. T2 would be great. But idk if Regulators will let Sony buy them.
I don't think Sony will spend any money on major acquisitions for SIE in the next 3 years. There is zero chance they acquire ncsoft or kadokawa, maybe a minor percentage stake increase in fromsoft. They are focused on profitability and not speculative purchases.
Regulators absolutely won't stop the purchase of T2. It's a significantly smaller purchase than Activision and Xbox is already clearly diminished from the console space. There won't be anyone to object.
Sony has put more on the plate for acquisitions in this midrange plan than the previous midrange plan. Sony's focused on profitability, but they're still focused on growth as well. In their focus on profitability, they're looking to cut cost and lower hardware losses, it doesn't mean they're not looking to acquire assets.
People should re-visit the business segment meeting for Games and Network.
- Evolving Financial Profile with Increasing Operating Leverage
- This means they want to increase revenue while keeping operating costs lower
- I think you can argue that utilizing Bluepoint to assist FromSoftware in development would allow them to produce games faster and more efficiently with known high margins, especially with PC
- Their plan for FY21-23 was to establish a leading position in the console market and they've essentially vanquished Xbox
- Their plan for 24-26 is to drive sustainable and profitable growth and invest in the future of play
- Buying FromSoftware and having Elden Ring, Demon's Souls, Bloodborne, and Seikro is certainly sustainable and profitable, especially the position it puts Sony in on PC if they wanted Elden Ring 2 to be exclusively on their PC store
- You make a few deals with publishers who also don't want to lose a full 30% on PC and you can pretty quickly put together a successful PC launcher fueled by Sony first party games
That's not what that means.
What it means is that they're not going to go for risky investments that have less clear profitability.
They're still planning 11.5 billion in investments (yes some of that is going to stock buyback, but it's still a greater total number than was planned in the previous mid range plan in which Sony bought Bungie.
I think Kadokawa or FromSoftware is a much less risky bet for Sony than Bungie. From's track record is just as good if not better than Bungie's and they have a far more diverse portfolio.
An Elden Ring 2 probably gives you 1.05 billion in revenue by itself. That ignores a Bloodborne 2 and a Demon's Souls 2. As well as porting Bloodborne to PC. You could probably pay off an investment in Kadokawa in one generation. Whereas Bungie has a lot more risk involved because so much is riding on Marathon being successful.
Regulators would block Sony, because they aren't American Big Tech. Regulators for the most part serve the interests of the US Empire. It is what is.
I'd bet regulators would say that Sony is already too dominant in console and game subs markets, and that making a huge acquisition like Take 2 -which include huge top sellers like GTA, NBA2K or RDR- would make more difficult to compete against them.
So would force them to do something that Sony anyways pretty likely will do: to keep Take 2 full multiplatform, as happened with Mojang, Bungie or ABK.
If Sony ever aquires -I think they won't- a top publisher will be to secure them as partners and block any deal with the competition, but mostly to get the revenue and profit they generate everywhere, specially outside PS, to get money from other platforms without using the PlayStation / PS Studios brand.
The opposite.
FromSoft did hit the jackpot only once with Elden Ring. They have been making games since the PS1, all of them had mediocre/ok/low sales until Bloodborne (7M+ as of 2022), Dark Souls 3 (10M as of 2020), Sekiro (10M as of late 2023) and Elden Ring (not Armored Core 6).
Bungie instead did hit the jackpot with every single game they made on console and even broke the record of the fastest selling new IP -Destiny 1- and have one of the most successful GaaS -Destiny 2-, which despite being around 7 years old generates around $100-200M/year.
Both would be good and safe acquisitions, but if it's a safe bet here it's Bungie because all their console games were huge hits and way more successful ones (comparatively to the context of each generation) that the FromSoft games.
Marathon's teaser broke the youtuve record for a Sony game announcement, but isn't the only Bungie asset: Destiny 2 continues making money, as will Destiny 3 and the movie/tv adaptations of Bungie IPs that are in the works. Plus they also help the other Sony GaaS, so indirectly are generating even more money.
Plus regarding the creation of new IPs, they created Halo and Destiny, so very likely will also create other very successful IPs.
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Interesting thread.
I can't see it as anything but negative both for PlayStation customers and the industry as a whole.
Moves like this show a lack of competition is setting in. It's all harvesting and they are not even trying to attract new users to the hardware they make.
I can't see it as anything but negative both for PlayStation customers and the industry as a whole.
Moves like this show a lack of competition is setting in. It's all harvesting and they are not even trying to attract new users to the hardware they make.
