Sony May Just Be Loosening The Reins As Gaming Brings In A Plurality Of Its Revenue

from the money-games dept

Any trip down Techdirt's memory lane when it comes to Sony is not going to leave you with a good taste in your mouth. This is a company that has been almost comically protective of all things intellectual property, engaged in all manner of anti-consumer behavior, and is arguably most famous for either using an update to remove features from its gaming console that generated sales of that console or for installing rootkits on people's computers. When it comes to any positive stories about the company, in fact, they mostly have to do with the immense success Sony had in the most recent Console Wars with its PlayStation 4 device.

Positive results and gaming aren't a crosstab of coincidence for Sony, it seems. There are couple of converging stories about Sony, one dealing with its revenue and another with its plans for its gaming divisions opening up a bit, that point to positive developments. To set the stage, let's start with the fact that the video game industry is now the biggest revenue generator for Sony.

Sony’s full year corporate report was published over the weekend Australian time, and as always it covers Sony’s PlayStation division as well as the other units within its business. Naturally, the coronavirus was a big factor, with Sony estimating a ¥68.2 billion loss ($876.3 million) in operating income just from COVID-19.

But gaming has done well for Sony. The PlayStation business now generates more sales and operating income than any other part of Sony:

Now, it's worth noting that Sony's gaming revenue is actually down for 2019, but the percentage as revenue generator for the company is up. And, as noted above, gaming is now the single largest revenue generator of any market Sony is in. And what's really interesting in all of that is that it's happening while Sony has famously limited its own reach with walled gardens. PlayStation exclusives have been the norm wherever Sony can sign them. Sony's first-party games, many of them among the best that gaming has to offer, have of course been siloed on PlayStation consoles. For years, Sony limited PS4's remote play function to Sony Xperia phones that never broke ground in market share. Everything, it seemed, was designed to be as locked into Sony's walled garden as possible.

But we're starting to see signs that the company has recognized that it needs to change.

All that said, explicitly mentioning the potential for PC ports in its annual report is the latest sign that Sony continues to slowly loosen its tight, walled-garden approach to game hardware and software. In 2017, for instance, Sony expanded its PlayStation Now streaming service to work on Windows PCs as well as PS4 hardware. That service now has 2.2 million regular subscribers, Sony says, up significantly from the 1 million subscribers claimed last November.

In 2018, Sony finally opened PS4 titles to cross-platform online play with other consoles after years of public reluctance on that score. Then, earlier this year, Sony said MLB: The Show will come to non-PlayStation consoles as soon as 2021, after decades of PlayStation exclusivity.

It all speaks to a company that's more aware that "competition from online PC games and players from other industries is expected to continue to intensify," as it says in its annual report. Even as Sony pushes hard for the exclusive "speed, haptics, and sound" improvements of the upcoming PlayStation 5 this year, it is hedging its bets somewhat with support for non-Sony hardware as well.

If gaming is your best revenue generator, these moves only make sense. MLB The Show is fantastic; why should Sony only sell it to PlayStation owners? While Horizon: Zero Dawn took over three years to make it to the PC... it still made it. Why wouldn't Sony want to sell its game to PC gamers that may never want to buy a PlayStation, but would love to play some of the games previously exclusive to it?

It's long past time Sony teared the walls of its garden down. Let the revenue streams in. Increase availability of its products. Make more money.

The only surprising aspect of all of this is how much work it took to convince Sony that more money was good.

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Filed Under: consoles, video games
Companies: sony


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  • identicon
    Pixelation, 3 Sep 2020 @ 8:40pm

    "Sony is not going to leave you with a good taste in your mouth. This is a company that has been almost comically protective of all things intellectual property, engaged in all manner of anti-consumer behavior, and is arguably most famous for either using an update to remove features from its gaming console that generated sales of that console or for installing rootkits on people's computers."

    How is this different from most US corporations? Seems to be what they all strive for, in fact. "We're going to fuck you in the ass after we take your money, and then we will find a way to fuck you in the ass again."

    reply to this | link to this | view in chronology ]

    • icon
      PaulT (profile), 3 Sep 2020 @ 11:19pm

      Re:

      "How is this different from most US corporations?"

      Other companies are way more subtle about it, occasionally even giving actual benefits to go with the abuse.

      reply to this | link to this | view in chronology ]

      • icon
        Scary Devil Monastery (profile), 4 Sep 2020 @ 2:05am

        Re: Re:

        I'd like to say that many other companies use actual benefits and "consumer satisfaction" as a way to remain competitive.

        Sony is the type of corp which uses their few decent offers to bait you into entering their walled horror garden of doom.

        Sure, there are plenty of such companies around - oracle stands out - but Sony is a bit unique in that they primarily apply the same tactics to the direct consumer market.

        reply to this | link to this | view in chronology ]

    • icon
      Scary Devil Monastery (profile), 4 Sep 2020 @ 2:00am

      Re:

      "How is this different from most US corporations? Seems to be what they all strive for, in fact. "We're going to fuck you in the ass after we take your money, and then we will find a way to fuck you in the ass again.""

      Because Sony will grin while they do it and then tell everyone how horrible you are for refusing to drop your pants voluntarily.

      reply to this | link to this | view in chronology ]

  • icon
    Scary Devil Monastery (profile), 4 Sep 2020 @ 1:59am

    Not holding my breath here.

    "But we're starting to see signs that the company has recognized that it needs to change. "

    Sony is as close as the real world gets to the corporation of a cinematic evil overlord, complete with nefarious plots and malice mainly for the sake of avarice and compulsive-obsessive control issues.

    You wouldn't expect a Tech corp to stand up and condemn the internet as a whole - yet Sony has done just that.

    You wouldn't expect a leak of internal papers to reveal a nefarious plot to attack the at the time leading company for online freedoms in a convoluted maneuver which included bribing a US district attorney - yet the sony leaks exposed just that.

    If you sell equipment with the solemn on-the-box promise of a certain key functionality, taking that functionality away with a remote patch is comparable to theft. And guess what Sony did on their "otherOS" PS3.

    If someone cracks equipment they bought from you and reveal to the world that your security is so flawed a customer actually owning what they bought jeopardizes your customer account security you'd be expected to fix that sorry state of affairs rather than (or at least in addition to) go on a wrath-driven vengeance spree against that customer of yours. But no, months later a cracker team uses that exact loophole, still unpatched, and walks away with Sony customer data.

    If you are among the first to issue android smartphones and the only ones whose first Xperia can't synchronize with MS or Open office apps you'd be considered an idiot. But guess what Sony did.

    In similar vein if you build a world-class digital camera which alone among digital cameras can't accept the open standard of SD cards...well, guess what Sony did.

    The list just goes on. Sony's most recognizable brand aspect is the way they screw their customers in a thousand minor petty ways. I have as hard a time believing they'll change that as I would a
    statement by David Duke stating that the KKK was, from now on, going to re-tool the whole shebang of white sheets and cross-burning into wholesome pro-egalitarian multiracial family celebrations.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 4 Sep 2020 @ 8:12am

      Re: Not holding my breath here.

      Because I would argue Sony isn't a tech corp.

      Its a megacorp of the Gibson vein, with its fingers in many pies, only one of them being technology.

      Sony sells insurance, and apparently they apparently make vastly more money as an insurance company than a technology company.

      Which means while the high level board may still see themselves of a technology company (mostly for reasons of prestige or history), the up-and-coming management probably don't see themselves as part of a technology company.

      Source: https://www.nytimes.com/2013/05/28/business/global/sonys-bread-and-butter-its-not-electronics.html

      reply to this | link to this | view in chronology ]

      • icon
        NaBUru38 (profile), 5 Sep 2020 @ 6:25pm

        Re: Re: Not holding my breath here.

        "apparently they apparently make vastly more money as an insurance company than a technology company"

        Did you even read the chart, not to mention the article's title?

        reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 5 Sep 2020 @ 10:41am

      Re: Not holding my breath here.

      Sony is as close as the real world gets to the corporation of a cinematic evil overlord, complete with nefarious plots and malice mainly for the sake of avarice and compulsive-obsessive control issues.
      I thought that was Apple. No wait, Steam. Wait, Google. Actually, Facebook. Maybe Amazon?

      All jokes aside, the most amazing thing about Sony is that, while everyone agrees that the other companies I mentioned are out to fuck you (with the exception of Apple cultists), a lot of gamers internalized the bullshit argument that PlayStation exclusives are actually good for them, which is insane to me.

      reply to this | link to this | view in chronology ]

      • icon
        NaBUru38 (profile), 5 Sep 2020 @ 6:29pm

        Re: Re: Not holding my breath here.

        PlayStation provides entertainment for a price. So does Disney, Electronic Arts, Warner and Bandai Namco.

        Anyone can decide not to buy expensive entertainment and play football or have sex. The fact that these companies have millions of customers shows that they are satisfied.

        reply to this | link to this | view in chronology ]

        • icon
          PaulT (profile), 6 Sep 2020 @ 12:27am

          Re: Re: Re: Not holding my breath here.

          "PlayStation provides entertainment for a price. So does Disney, Electronic Arts, Warner and Bandai Namco."

          Disney provides entertainment for $70/year, a $20 DVD or a $15 cinema ticket. EA and Bandai provide entertainment for $70 per game. Playstation provides entertainment for $400 before you've bought a single game. There's a slight difference.

          "The fact that these companies have millions of customers shows that they are satisfied."

          That's a very faulty conclusion. If I had to buy a PS4 just to play The Last Of Us and Uncharted, but prefer to do my gaming on XBox, that doesn't make me a satisfied Sony customer. That makes me someone who had to pay $400 just to be able to play a handful of the games I want. That's a personal choice, but it does not indicate that a person is happy with having to have make that choice.

          Similarly, there's a lot of people who hate EA, but they have no other option if they want to play certain types of titles, such as licenced sports titles. That doesn't make them satisfied customers, that makes them people forced to buy from a monopoly to obtain the only choice they have if want a specific type of thing..

          reply to this | link to this | view in chronology ]

          • icon
            Scary Devil Monastery (profile), 9 Sep 2020 @ 2:05am

            Re: Re: Re: Re: Not holding my breath here.

            "If I had to buy a PS4 just to play The Last Of Us and Uncharted, but prefer to do my gaming on XBox, that doesn't make me a satisfied Sony customer. That makes me someone who had to pay $400 just to be able to play a handful of the games I want. That's a personal choice, but it does not indicate that a person is happy with having to have make that choice."

            Most corporations like to at least include "customer satisfaction" as a primary for their Brand. Modern marketing is adamant that in addition to leveraging lock-in effects you must ensure that you are perceived as better than the competitor.

            Sony instead loves to apply the lock-in effect as sole leverage with the view that the customer is an indentured serf eternally beholden to them. The Sony rootkit - where they added malware to music discs which infected every computer playing the disc - was just the tip of that very ugly iceberg.

            Sony has been the driving force in most of the more harmful political maneuvers and no few outright illegal ones (the bribery of Jim Hood, Mississippi's DA stands out) to ensure the internet as is goes away. A true mass communications medium is just too inconvenient for a corporation which finds having to compete be a massive burden.

            By now I just assume that any move of Sony's will be rooted in malice before anything else. They left benefit of doubt at the wayside back in the 90's.

            reply to this | link to this | view in chronology ]

            • icon
              PaulT (profile), 9 Sep 2020 @ 6:01am

              Re: Re: Re: Re: Re: Not holding my breath here.

              "Most corporations like to at least include "customer satisfaction" as a primary for their Brand"

              Marketers lie about a lot of things.

              "By now I just assume that any move of Sony's will be rooted in malice before anything else"

              I need to apply Hanlon's Razor here. I don't think Sony have been deliberately malicious with a lot of their actions, they just don't think about long-term consequences. Or, if they do, they it's more along the lines of "how can we magically stop piracy" or "how can we make more money on peripheral storage", rather than "how dumb will we look when rootkits cause more damage than piracy" or "what do we do when everyone else uses SD cards instead of our overpriced memory sticks?"

              reply to this | link to this | view in chronology ]

              • icon
                Scary Devil Monastery (profile), 9 Sep 2020 @ 7:28am

                Re: Re: Re: Re: Re: Re: Not holding my breath here.

                "I need to apply Hanlon's Razor here. I don't think Sony have been deliberately malicious with a lot of their actions..."

                I've applied Hanlon's razor myself...and every time i try to use it on Sony, it breaks and i have to get a new one.

                The Sony email leaks alone pretty clearly outline a long-term plan of actual malice. That anyone can believe it's OK to include a computer virus with a legally purchased music disc is frightening - and Sony certainly doesn't lack for lawyers who would have told them just how outright criminal that was.

                There are plenty of examples where Sony's malice is self-evident to the point where Hanlon takes his razor and goes home, shaking his head.

                "...they just don't think about long-term consequences. Or, if they do, they it's more along the lines of "how can we magically stop piracy" or "how can we make more money on peripheral storage"..."

                ...that's actually how Trump seems to think. I'm letting Gray's Law tag in from Hanlon here. At a certain point sufficiently advanced incompetence becomes indistinguishable from malice.

                Frankly speaking even if it turns out Sony's manifest malice all stems from staggering and persistent ineptitude and every Sony CEO somehow being an anachronistic farce like Michael Lynton *that no longer matters. Paraphrasing Popehat again; if the reason they're fucking donkeys is because they honestly can't tell the difference between donkeys and willing women then that still makes them donkey fuckers. On a side note "being evil because stupid" doesn't leave them looking much better, really.

                reply to this | link to this | view in chronology ]

      • icon
        PaulT (profile), 6 Sep 2020 @ 12:28am

        Re: Re: Not holding my breath here.

        "a lot of gamers internalized the bullshit argument that PlayStation exclusives are actually good for them, which is insane to me."

        Gamers can be very tribal, and always have been to a certain extent. I grew out of that a long time ago, but there's always been tribes - Sega vs Nintendo, Spectrum vs Commodore, Amiga, vs Atari ST, Playstation vs Nintendo 64, PC vs console, and so on.

        In that realm, exclusives are great if you're on top, since they get people over to your tribe. If the best exclusives are on your platform (as they have been this generation, with few XBox exclusives of note outside of Halo and Forza), and they attract people to your platform, they may actually be good for you.

        If people grow up a bit and understand that the games are more important than whose console you play them on, then it's obvious that this kind of hoarding is harmful, not least next gen when XBox have many exclusives that a PS4-only gamer will have no access to. But, I can understand why some people are so foolish as to think it's good for them, for now.

        reply to this | link to this | view in chronology ]

        • icon
          Scary Devil Monastery (profile), 9 Sep 2020 @ 3:14am

          Re: Re: Re: Not holding my breath here.

          "People can be very tribal"

          Emphasis and amendment mine. People are tribal and it gets less weird what symbols they focus on when you consider that in the past and present massive hordes of otherwise cognizant beings have been willing to kill and die for colored doodles on a pennant.

          Emacs vs vi. PS vs Xbox. Mac vs PC, iPhone vs Android. Left vs Right. White vs Black. Crescent Moon vs Cross. It's the same principle and the only difference is how the tribalist anger against the other expresses itself.

          "If people grow up a bit and understand that the games are more important than whose console you play them on, then it's obvious that this kind of hoarding is harmful..."

          That's not a given "if", though. All too many instead grow up clinging to the tribalist ideal and face the concept of the other having any ideas or properties worth adopting with blind aggression instead, because actually thinking is hard and re-evaluating your own beliefs often too crushing for fragile egos to endure.

          "But, I can understand why some people are so foolish as to think it's good for them, for now."

          Of course they do. That's what they get told by all the hype and advertising. The first step towards owning someone is to give them the illusion that they're making the choice of getting locked-in themselves - that there is no other rational choice. Unscrupulous marketing uses tribalism as a potent lever.

          It's ironic that in an age where we discuss corporatism seriously, modern marketing in some companies has begun to more closely approach the advice given in Machiavelli's "The Prince".

          Sign of the times, I guess...I've been saying that a lot lately, and never in a good way...😟

          reply to this | link to this | view in chronology ]

  • icon
    Darkness Of Course (profile), 4 Sep 2020 @ 3:53pm

    One subject only HDMI

    Yep, the lynch pin of the future. Well, Sony's revenue future that is. It was designed to prevent copying their precious IP. They are the original overreach kings, no queens in Sony's leadership.

    Jobs rejected HDMI for iMacs. Why? Too limited, too small, not enough speed, not enough DPI. And they shipped with a display that was larger, and better than Sony could support. A lot of apple's customers were content creators, who had to scale their work back to fit into Sony's limited visions.

    Then their future tanked. They bet big on everybody in the world needed a cash cow HDMI license. And, surprise - the gaming division because their best revenue source. It's only taken another decade plus before Sony started to realize that licensing and thus limiting the future to their half-blind vision doesn't actually produce the revenues projected.

    Inflated revenues based on inflated IP values that have little if any connection to reality. Sony nearly died. Gaming saved them. Simple as that.

    reply to this | link to this | view in chronology ]


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