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gothmog

Member
Oct 28, 2017
2,434
NY
Nintendo is doing very well with its first party franchises. They are the reason people buy Switches.

Sony is much more dependent on third parties and losing COD is very much an apocalypse scenario to them. Microsoft will be taking over the "box near the tv" market while Nintendo keeps on thriving with its own thing.
Sony does well with first party franchises. It is the reason people buy Playstations.
 

Iron Eddie

Banned
Nov 25, 2019
9,812
Nintendo is doing very well with its first party franchises. They are the reason people buy Switches.

Sony is much more dependent on third parties and losing COD is very much an apocalypse scenario to them. Microsoft will be taking over the "box near the tv" market while Nintendo keeps on thriving with its own thing.
Which is why it is not good for the industry to have someone who continues to take the lions share of third party revenue. We have already witnessed how companies use this leverage to their advantage making it harder for others to compete.

So instead of the sentiment I'm worried what this means for Sony, we should have been more vocal in the past about any influences that can impact consumers.

Sony does well with first party franchises. It is the reason people buy Playstations.

Not entirely true, it is now part of the package. Sony did not enter this arena with known franchises or a pool of studios. They entered with an affordable system that was more desirable and had major marketing deals with third party publishers. Over time their studios became 1st class, which made PlayStation a powerful two-punch combo (1st and 3rd party support) entering each generation of that momentum.
 

gothmog

Member
Oct 28, 2017
2,434
NY
Not entirely true, it is now part of the package. Sony did not enter this arena with known franchises or a pool of studios. They entered with an affordable system that was more desirable and had major marketing deals with third party publishers. Over time their studios became 1st class, which made PlayStation a powerful two-punch combo (1st and 3rd party support) entering each generation of that momentum.
I mean we're on the 5th generation of Playstation. Sony has changed their approach multiple times. They are now as strong as they have ever been with first party franchises. And now we are starting to see big budgets and big stars doing their movies and shows based on those franchises. This shows that there is value to those franchises.
 

Polyh3dron

Prophet of Regret
Banned
Oct 25, 2017
9,860
A headline like this may need to be published in 4 years or so, when all these big moves from Microsoft are finally bearing fruit. But Sony has a ton of time to keep up the pace, and their inertia will carry them really far.

Also, similar to the situation with the original Xbox, while Microsoft may now have an absolute shit ton of western devs and IP, Sony still seems to have the vast majority of Japanese developers and publishers on their side.
 

Niosai

One Winged Slayer
Member
Oct 28, 2017
4,921
Years ago, you served my father in the console wars...

This is kind of a weird article and I assume it's weird and inaccurate on purpose. Otherwise we probably wouldn't be talking about it.
 

inpHilltr8r

Member
Oct 27, 2017
3,244
The US print edition showed up in my mailbox (I like to read in the bath), and, well there's a subtle difference that I think may be throwing Era a bit. The print headline for this column is "Epic battle" while the sub is "How Sony can outmanoeuvre Microsoft in the console wars". The contents page has a shorter sub "Sony's gaming gamble".

The word "comeback" is not used in the body of the article either, which is fairly balanced, couching MS potential advantage with all sorts of "could" phrasings. Also notes that the GamePass model for videogames is "unproven", and talks about the lag problem.
 

Quinton

Specialist at TheGamer / Reviewer at RPG Site
Member
Oct 25, 2017
17,256
Midgar, With Love
Is this 2008?

The US print edition showed up in my mailbox (I like to read in the bath), and, well there's a subtle difference that I think may be throwing Era a bit. The print headline for this column is "Epic battle" while the sub is "How Sony can outmanoeuvre Microsoft in the console wars". The contents page has a shorter sub "Sony's gaming gamble".

The word "comeback" is not used in the body of the article either, which is fairly balanced, couching MS potential advantage with all sorts of "could" phrasings. Also notes that the GamePass model for videogames is "unproven", and talks about the lag problem.

This is good info, appreciated.
 

Iron Eddie

Banned
Nov 25, 2019
9,812
I mean we're on the 5th generation of Playstation. Sony has changed their approach multiple times. They are now as strong as they have ever been with first party franchises. And now we are starting to see big budgets and big stars doing their movies and shows based on those franchises. This shows that there is value to those franchises.
Yes but as I said, they now have a one-two punch. The revenue from third party shows that many many people buy the system for third party games. This is not disputable. Nintendo has a much higher attachment rate of 1st party.
 

Antrax

Member
Oct 25, 2017
13,276
Sony does well with first party franchises. It is the reason people buy Playstations.

I mean we're on the 5th generation of Playstation. Sony has changed their approach multiple times. They are now as strong as they have ever been with first party franchises. And now we are starting to see big budgets and big stars doing their movies and shows based on those franchises. This shows that there is value to those franchises.

They're definitely successful, but it's a fact that most PS/Xbox owners don't have 1st party games for those boxes, or maybe one or two at most. Nintendo is the box driven by 1st party sales (hell, look at Animal Crossing). The vast majority of PS4/X1 owners never played God of War or Halo 5, but it's harder to make that statement for something like Breath of the Wild and Switch owners
 

Laver

Banned
Mar 30, 2018
2,654
For all that said Gamepass had no effect on Nintendo or PlayStation and hardware sales still lagged behind their competitors. Gamepass subscription growth had also slowed. Gamepass the service isn't the difference maker it's the content or more importantly the removal of content from PlayStation that will be the difference maker for Xbox. The Activision deal would be just as important if Gamepass didn't exist. Gamepass is merely the driving force behind MS corporate allowing such an expenditure.
Xbox already is far more popular than it was several years ago. It had $9B in revenue in 2017 and $16.2B in 2021. That's a huge turnaround. Game Pass might not be leading to lessening the market's interest in the Playstation or Nintendo brands, but it has certainly helped revitalize the Xbox brand. And while Microsoft is certainly hoping that Xbox Series will have sold far better than Xbox One (and early indications show that it will), their hope is also to obtain subscriptions on PC and via streaming, however suboptimal their delivery is on both fronts at the moment.

And yeah, a service like Game Pass needs new and exciting games appear constantly to drive conversation around it. I'm sure Netflix has the biggest growth spurts when one of their shows goes viral, eg. Stranger Things or The Squid Game. Similarly, MS needs to increase frequency of first party releases, not to hurt Sony but to help Xbox's bottom line.
 

LAA

One Winged Slayer
Member
Oct 28, 2017
2,324
Same as others are saying, they need a comeback?
As far as I know, they're ahead in terms of consoles sold (though that increasingly is seeming to not matter as much with MS/Sony looking at services, multiplatform, etc.), and at least as far as I'm concerned, Sonys 'exclusives' still interest me more than MS, even with their buyouts, at least for now.
That said, it's indeed looking like the case Sony would not be able to compete in the "buying wars", even if Bungie deal was in the making for 5-6 years, it feels too coincidental to finish just after Activision deal was announced, and at a time where it felt Sony has to respond in someway, and even then, Bungie simply isn't as big as a buy as Activision (though considering how much I play Destiny, it certainly means more to me compared to most of what I play from Activision nowadays)
 

AndrewGPK

Member
Oct 27, 2017
3,826
Comeback is the wrong word. But they face a clear future challenge in that MS is ahead of the game in subscriptions services and can afford to outcompete Sony and lose money in that sphere. I don't think Sony can afford to do all the Day 1 stuff.

I don't think its quite a Netflix/Blockbuster type thing, but Sony definitely needs to realize they are going to have to perform very well to maintain a market lead or not fall to second. I think they just need to continue with the excellent first party stuff and be creative with their other services. They aren't going to match game pass but can make something more comparable and worthwhile than what they have now.
 

JasoNsider

Developer
Verified
Oct 25, 2017
2,144
Canada
I feel like a ton of these hot takes from 2021 and early 2022 are really premature, as we are fairly close to having a big Sony subscription service push. And that might not even turn out to be a smash hit, who knows - but these takes are wayyyy too early.
 

leburn98

Member
Nov 1, 2017
1,637
Apart from the Zenimax/Bethesda catalog hitting Game Pass, we have yet to truly see the effects that these acquisitions will have on Sony. The first big hitter will be Starfield which could give us some indication. However, the true test will be in 2024 when a potential mainline Call of Duty could drop as an exclusive.

Sony does well with first party franchises. It is the reason people buy Playstations.
The question is, how many PlayStation owners purchased a PlayStation to play the first party franchises, versus those who purchased a PlayStation for something like Call of Duty and then purchased the first party titles because that is the console they owned.

For years, the PlayStation was always the safest bet when buying a console. Not only would you get access to every major third party title (often with exclusive items), you would also get access to amazing first party titles. On the Xbox side, unless you were a hardcore Halo, Gears and Forza fan, you likely were not missing out on much going PlayStation. However, Microsoft's recent acquisitions has certainly changed that landscape. No longer can you buy a PlayStation with the confidence that you can play the next Call of Duty, Overwatch, Diablo, Starfield, Elder Scrolls, etc.

However, comeback is not something I would use right now. We still have yet to see what Sony has cooking for the next few years to make a complete judgement when one or another.
 
Better Buy: Microsoft vs. Sony (The Motley Fool)
OP
OP
Shoot

Shoot

Member
Oct 25, 2017
4,532
www.fool.com

Better Buy: Microsoft vs. Sony | The Motley Fool

Which tech juggernaut will be a stronger investment this year?
Microsoft (NASDAQ:MSFT) and Sony (NYSE:SONY) operate very different business models, but they have overlapping interests in the video game market. That's why Microsoft's recent decision to buy Activision Blizzard (NASDAQ:ATVI) for $68.7 billion caused Sony's stock price to retreat from its highest levels in over two decades.

However, I believe Microsoft and Sony are still both safe long-term investments as rising interest rates crush more speculative growth stocks. So should you consider buying one stock over the other right now?
Microsoft's expansion of its cloud services, especially Azure, Dynamics, and Office 365, offset its slower sales of on-premise software in recent years. Between fiscal 2016 and fiscal 2021 (which ended last June), Microsoft's revenue grew at a compound annual growth rate (CAGR) of 14.5%, while its earnings per share (EPS) increased at a CAGR of 30.8%.

That robust growth enabled Microsoft to generate plenty of cash to expand its ecosystem with dozens of acquisitions -- including LinkedIn in 2016, GitHub in 2018, ZeniMax in 2021, and Activision Blizzard this year.

The stickiness of Microsoft's ecosystem -- which spans across PCs, consoles, mobile apps, servers, and cloud services -- enables it to continuously lock in both enterprise customers and mainstream consumers. Analysts expect Microsoft's revenue and earnings to rise 18% and 16%, respectively, this year, as those growth engines continue to fire on all cylinders.

Sony's growth was a lot less impressive. Between fiscal 2015 and fiscal 2020 (which ended in March 2021), its revenue grew at a CAGR of just 1.8%. It posted a net loss in 2015, but it returned to profitability the following year, and its EPS increased at a CAGR of 68% between 2016 and 2020.

Sony's gaming, financial, and music businesses stayed strong throughout the pandemic in 2020. But its pictures, chipmaking, and consumer electronics divisions all struggled with pandemic-related headwinds and disruptions.

That balance shifted in the first nine months of fiscal 2021. Its pictures and consumer electronics segments recovered, but its gaming business slowed down against tough comps, the financial segment sold fewer life insurance policies, and its image sensor shipments remained sluggish.

The concerns regarding Microsoft's purchase of Activision are likely overblown since Microsoft doesn't plan to lock in any of its top franchises as platform exclusives anytime soon. Sony also plans to acquire more publishers, starting with Bungie for $3.6 billion, to strengthen its own stable of gaming franchises.

Sony faces more significant supply chain headwinds than Microsoft, but analysts still expect its revenue to grow 11% this year. Analysts expect Sony's earnings per share to decline 33% on tax-related charges, but the company still expects its operating profit to rise 26% for the full year.
Microsoft has better growth metrics than Sony, but its high forward price-to-earnings ratio of 33 reflects those strengths. By comparison, Alphabet and Meta Platforms trade at 23 times and 20 times forward earnings, respectively.

Sony trades at just 17 times forward earnings. That discount likely reflects the market's trepidation regarding Microsoft's Activision deal, the supply chain headwinds for its chip business, and its slower life insurance sales.

Microsoft's stock is more expensive, but I think it's better to pay a premium for a high-quality business than to settle with a decent one in this wobbly market. Both stocks are still worth buying today, but I believe Microsoft will still outperform Sony -- as it did over the past five years -- once again in 2022.
 

Iron Eddie

Banned
Nov 25, 2019
9,812
For all that said Gamepass had no effect on Nintendo or PlayStation and hardware sales still lagged behind their competitors. Gamepass subscription growth had also slowed. Gamepass the service isn't the difference maker it's the content or more importantly the removal of content from PlayStation that will be the difference maker for Xbox. The Activision deal would be just as important if Gamepass didn't exist. Gamepass is merely the driving force behind MS corporate allowing such an expenditure.
Xbox Series never even launched with a big exclusive yet. We also have to account that PS4 was a huge success for Sony and that momentum carried over and even with all that Xbox is still doing better. This is even without Bethesda or Activision acquisitions having exclusive content on Game Pass yet.

Game Pass is now at 25 million, how has that slowed when it was 10 million in 2020? Lol
 

gothmog

Member
Oct 28, 2017
2,434
NY
Apart from the Zenimax/Bethesda catalog hitting Game Pass, we have yet to truly see the effects that these acquisitions will have on Sony. The first big hitter will be Starfield which could give us some indication. However, the true test will be in 2024 when a potential mainline Call of Duty could drop as an exclusive.


The question is, how many PlayStation owners purchased a PlayStation to play the first party franchises, versus those who purchased a PlayStation for something like Call of Duty and then purchased the first party titles because that is the console they owned.

For years, the PlayStation was always the safest bet when buying a console. Not only would you get access to every major third party title (often with exclusive items), you would also get access to amazing first party titles. On the Xbox side, unless you were a hardcore Halo, Gears and Forza fan, you likely were not missing out on much going PlayStation. However, Microsoft's recent acquisitions has certainly changed that landscape. No longer can you buy a PlayStation with the confidence that you can play the next Call of Duty, Overwatch, Diablo, Starfield, Elder Scrolls, etc.

However, comeback is not something I would use right now. We still have yet to see what Sony has cooking for the next few years to make a complete judgement when one or another.
I think Sony will be fine because nothing of consequence happens to the third party library for at least a few years. The only truly lost high profile third party game is Starfield so far. CoD is safe for a while. A multiplayer western style RPG or ARPG announced by someone like Bungie would do a lot to keep people who would be interested in Starfield or the next Elder Scrolls buying Sony.

I would love to see Microsoft actually make Sony sweat here, but that would require a level of first party output that we just have not seen out of them yet. The end of last year showed promise.
 

Speevy

Member
Oct 26, 2017
19,326
It's not only too soon to say Sony needs to come back. It's also too soon to say any of these acquisitions have helped Microsoft do whatever these publications think they're doing.
 
Nov 1, 2017
1,365
I'm in the wrong job, seems you can be paid to write complete nonsense articles like this with zero facts. Sony is basically the market leader if you consider Nintendo sort of doing their own thing, there's nothing to come back from.

Christ, what's next, articles about how Google Search can make a comeback?
 

fourfourfun

Member
Oct 27, 2017
7,680
England
Sony is basically the market leader if you consider Nintendo sort of doing their own thing

You can't though. Two out of the last three Nintendo consoles walked the competition by simply having a better strategy when targeting markets. That's without even thinking about how they swatted away every attempt to get in on the handheld market too. Then again, to come back against Nintendo, you actually need to have toppled them first.
 

arsene_P5

Prophet of Regret
Member
Apr 17, 2020
15,438
Comeback is the wrong word. But they face a clear future challenge in that MS is ahead of the game in subscriptions services and can afford to outcompete Sony and lose money in that sphere. I don't think Sony can afford to do all the Day 1 stuff
MS could afford to loose unbelievable amounts of money with GP and fund it with Azure or other divisions money. But they don't and the answer to that is pretty straightforward. The business model has to be sustainable and shareholders wouldn't be to happy about MS burning money for a division that's still smaller and less important than something like Azure.

Spencer talked about this already and told us Xbox division is profitable and GP sustainable. Even though Xbox is seen internally as a growth business, they can't just burn all the MS money.
 

Freddie13

Member
Nov 2, 2017
640
MS could afford to loose unbelievable amounts of money with GP and fund it with Azure or other divisions money. But they don't and the answer to that is pretty straightforward. The business model has to be sustainable and shareholders wouldn't be to happy about MS burning money for a division that's still smaller and less important than something like Azure.

Spencer talked about this already and told us Xbox division is profitable and GP sustainable. Even though Xbox is seen internally as a growth business, they can't just burn all the MS money.
I am not sure Phil's statement was made before or after the acquisition. The acquisition will definitely impact its P&L even if not immediately.

A business model has be sustainable by being eventually profitable. That doesn't mean it can be so right away. Obviously MS invested all these money because it believes the business model will work. However, it can be a long term investment. It does translate into waste of resources just because it has low ROI for the time being.
 

Timbuktu

Member
Oct 25, 2017
5,232
The US print edition showed up in my mailbox (I like to read in the bath), and, well there's a subtle difference that I think may be throwing Era a bit. The print headline for this column is "Epic battle" while the sub is "How Sony can outmanoeuvre Microsoft in the console wars". The contents page has a shorter sub "Sony's gaming gamble".

The word "comeback" is not used in the body of the article either, which is fairly balanced, couching MS potential advantage with all sorts of "could" phrasings. Also notes that the GamePass model for videogames is "unproven", and talks about the lag problem.

Yeah. The UK print edition is the same. Their online guys obviously know how to generate clicks.