Can Sony win over the living room?
By Hayley Tsukayama,
Sony’s PlayStation 4 announcement delivered lots of top-of-the-line gaming specs sure to stir the heart of any video game enthusiast. But it did little to market its console to non-gamers, a risky strategy for a company that’s watched the gaming market drift away from its PlayStation brand.
Console gaming is falling in the face of a rise in mobile games that users play on smartphones and tablets. Sony reported a 15 percent year-over-year drop for the segment in its latest quarter. There’s a lot of chatter that the new wave of consoles — the PS4, the Wii U and Microsoft’s expected new XBox — could be the last generation of dedicated consoles before gaming becomes just another content category in an all-in-one entertainment device.
Microsoft, Sony’s main competitor in the gaming space, certainly thinks so. Xbox users spend more time watching video on the console than they do playing games, and that is driving Microsoft’s focus on original content, partnerships with streaming services and deals to carry live events such as the presidential debates. Microsoft is jumping on the trend by broadening the Xbox’s appeal an essential home device, declaring that the console should eventually be the “center of every household's entertainment.”
Many expected Sony would do the same and market the PlayStation as an all-in-one entertainment device with wide appeal. After all, the company also owns music and movie studios that could give it a leg up on premium content. But Sony has struggled to break down those walls within the company.
Instead, it seemed to stick close to its usual playbook of targeting its console specifically to gamers. It showed off flashy titles along with its biggest feature, but Sony didn’t highlight much that would appeal to a wider consumer base. The company did announce continuing partnerships with streaming services such as Netflix, Hulu Plus and Amazon Instant, but took almost no effort to differentiate its media from what’s available on Microsoft’s Xbox.
So, if Sony is truly ceding the opportunity to be the living room’s central device to Microsoft, does that mean the company is toast? Not necessarily, said Greg Miller, the PlayStation editor for gaming publication IGN. It could just indicate that Sony sees its future in a different kind of content. Focusing on the needs of gamers and showcasing big titles, he said, could be Sony’s way of setting itself up as a social and cloud gaming platform and publisher in anticipation of a time when consoles fade away.
“Their future is games,” Miller said. “If consoles go, PlayStation is going to be one of the most dominant publishers.”
In the near term, however, Sony still faces big challenges. Games were still its third-largest source of revenue, making up about 13 percent of the company’s total revenue in the last quarter. A new console is expected to boost those revenues, but consumers don’t yet know when they can buy the device and how much it will cost.
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