It's been obvious for a while, but Sony will continue to bet on the PlayStation 4 to put it back in the black. As part of a corporate strategy meeting earlier this week, the Japanese giant labelled its gaming business as a "growth driver", and recognised it as pivotal in its ambition of raising ¥500 billion ($4.2 billion) in earnings through the 2017 fiscal year.
Of course, we all know that the manufacturer's next-gen system is doing pretty darn well for itself, with 18.5 million units sold so far. The key for the company, however, will be those active PlayStation Plus subscriptions, which already span approximately half of the console's entire install base – and are only likely to increase in the future.
In fact, the platform holder intends to double down on these recurring money spinners, with PlayStation Now and PlayStation Vue also part of its near future plans. The main goal for the console maker is to get devices into peoples' homes, so that it can sell add-ons such as the aforementioned memberships, as well as software and content from the PlayStation Store.
Of course, it's not the only "growth driver" under the organisation's wing, as both Sony Pictures and Sony Music were given similar roles. It's perhaps clear from this that the firm sees its future as a media and content provider, more than perhaps a manufacturer. That said, its camera and audiovisual divisions were both recognised as stable profit generators.
The axe, then, is hanging over the head of its television and smartphone businesses, which the organisation said that it would "place the highest priority on curtailing risk and securing profits in its operation of these". It added that it would "carefully" select the territories with which to market products from each area. In other words: it's scaling both back.
It will continue to spin each of its divisions off as wholly owned subsidiaries, too – a monumental effort which it started with its television business last year. Its audiovisual department will be next up, starting from 1st October. The firm believes that this will give each area of the organisation "accountability and responsibility". No more being propped up by other brands, then.
Of course, while this all sounds like a solid plan for now, the company is still looking at some significant losses in the short term. It's expecting a net loss for the financial year due to end in March, which will mark its sixth in seven years. You do get the feeling that gaffer Kaz Hirai's on the cusp of a breakthrough, but there's still a long, long way to go.
[source eurogamer.net]
Comments 13
So...no indication of plans to improve the network to keep the current subscribers happy then?
@Jonny This was a much wider corporate meeting, but one would assume that if they're hinging part of their growth on subscriptions to PlayStation Plus that they need a high level of user retention. In other words: you'd hope that they understand they need to improve PSN.
@get2sammyb
Oh I completely agree, just until Sony publicly acknowledge the faults of the PSN and make a commitment to ensure a better more stable experience (Outages aside the one thing the last few weeks have shown is it's not consistently stable) for everyone then I won't believe it'll ever be on the cards unless people stop buying PS4s and those of us with PS4's stop subscribing to ps+.
@get2sammyb Didn't they say sometime last year that they were investing heavily into PSN infrastructure?
@Dodoo They did, yeah.
@Dodoo I guess it all depends on what they mean by "PSN infrastructure". If they mean they're putting lots of effort into fixing its weaknesses and removing the need for the PS4 to be continually logged in to PSN just to function then great.
I suspect (hope) they'll be doing some of that but it's more likely that the marketing people will want something they can sell to the public and the idea of advertising "hey everyone we've spent $XX million and PSN is reliable now" just won't cut it with the Sony big-wigs who decide where the money goes.
I hope I'm wrong but while people like me (yes, I admit it) continue to re-subscribe to PS+ every year in spite of their poor record what impetus have Sony really got to fix the weaknesses in their PSN architecture?
At least there's project Morpheus to look forward to regardless of how the rest of Sony (including PSN) performs ...
I read this as there is an increase in pressure on the whole Playstation brand i.e. make money at all costs. So I will expect some decisions that put profit before consumers. Quick example might be something like ads. They are already appearing in the news feed whether you like it or not. How long before they are on the actual dash like Xbox?
Might be a little bit cynical, but this actually concerns me.
@Jonny Its not just PSN thats having issues these days. XBOX Live has been having problems again recently. Three times this year I have been unable to sign into both X1 and 360. I would love to know whats going on with Sony's and Microsofts online services. This has to be the worst generation in terms of service issues and buggy/broken games.
@Pipr why does your PS4 need to connect to the PSN to function? I use my PS4 for many hours each day, and other than obvious online games, it doesn't matter if PSN connects or not. Hell I forgot to turn wifi back on for the PS4 for a week straight and didn't even notice until I tried to Netflix.
@thedevilsjester Because him like others and I know for myself play almost exclusively online. Sony has been pushing it with PSN and all these multiplayer features in games.
And people like it as well. To each his/her own preference.
@wittypixel I don't think this is what he means because he is asking for the PS4 to work when the PSN is down, it doesn't make sense to ask that online work when the online service is down. Also approximately 25% of PS4 users have PS+, so even if every single one cared about online play (they don't) it still doesn't amount to a very large percentage of their userbase.
I do think PSN needs to be more stable, or brought back up quicker, but the PS4 is hardly useless without it.
@thedevilsjester based on pushsquare articles I wish I could find again, it's way more than 25%. and even if he doesn't feel that way I know many do online when they have time too.
@wittypixel the pushsquare articles are way off. Oh their numbers are right, of course, but the article states that there are 8 million PS+ subscribers. And there are 18 million PS4s sold. At first glance that looks like its about half of the PS4 users that have PS+ but at least half (if not more) of those 8 million are PS3 users that haven't bought a PS4 yet (remember it has an 80 million install base and PS+ freebies are amazing on that platform), that leaves about 4 million subscribers out of 18 million users that are PS4 users. Not even 25%. Pushsquare keeps talking about half of the PS4 users having PS+, but they seem to have forgotten that it had millions of subscribers long before the PS4.
Many do, do online when they have time to, agreed. But that hardly makes the PS4 useless when the PSN is down. Which was my point.
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