Based on the layoffs and problems with releasing new IP, this "expansion" turned out to be inefficient and unprofitable.
Other studios outside of Insomniac and Naughty Dog were not treated well, and their IPs did not receive as many resources, especially marketing money.
As a result, there are big problems with IP for PS5, and the situation is saved by games from partner studios that are due out in a couple of months.
Against this backdrop, there are layoffs and news of projects being canceled.
The layoffs come from them investing a shit ton of money on making games but not being profitable enough even if growing to record numbers in console as they achieved.
Because the console market isn't big enough to fund them.
PC ports of old games are very cheap and profitable.
So this is why they will focus more on them, because without extra revenue channels like PC they would need to scale down more the amount of games they make and the size of their teams.
Same goes with the movies, they'll keep making more. And when ready, they'll slowly expand to mobile, too.
The alternative is to cancel more games, make them smaller and worse, shut down more studios and fire more people.
Yep, these expansions in hindsight seem pretty pathetic and amateurish. When entering 2021, I expected Sony to consistently deliver games due to all their new buyouts and studio expansions but now we are in 2024, and what a disappointment it has been so far. It is the way it is probably because Sony divided its focus on too many things, GAAS, and PC.
Sony's focus continues being their console. And inside first party games, the SP ones: they are the majority of the games under development. And they are working in more games at the same time than ever before.
They are expanding to GaaS and PC, but with dedicate teams for them, their SP games teams continue doing SP games.
That GaaS and PC required an initial extra effort, that's all. But their profitability will highly help them in the long term. GaaS and PC (plus movies and in the future mobile) are mandatory if they want to continue making AAA SP games and to continue increasing the amount of games they have under development.
Every generation means bigger, better looking and more detailed and dense AAA games, which require more people and time to be made. Hiring more people reduces that time increase.
On top of that, having more people allows them to work in more games. Which is what they are doing. But AAA games take now around 5-9 years to be made. Meaning that if they started a new AAA game in 2021, it will be released around 2026-2030.
AAA games aren't made in 6 months. It doesn't mean they have problems, it just means your expectations weren't realistic.
Regarding IP, there aren't problems at all. Their big IPs like Gran Turismo, MLB, Horizon, Ratchet, TLOU, GoW or Spider-Man are performing great, even with record selling numbers. Even Helldivers 2 is killing it. And they are also releasing great new IPs, like the recent Returnal or the promising Rise of the Ronin, Stellar Blade, Concord or Marathon.
Plus there are many successful ones that with a new game would continue being super successful like Uncharted or Days Gone.