Gaming

With the acquisition of Activision, Microsoft disrupts Sony’s strategy in video games

Sony Group finds itself in a situation that would make many gamers dream: the Japanese giant has reached the highest peak… only to realize that its old enemy is still there and getting stronger.

With the acquisition of Activision Blizzard for 75 billion dollars, Microsoft is on the way to taking over some of the most popular video games in the world. For Sony, it’s time to make decisions: how to expand the range of software? Should we continue to focus on hardware? What to do with the metaverse, that virtual world inspired by realistic video games?

For Microsoft, certain Activision-published games (including Call of Duty and World of Warcraft) are the future cornerstone of Game Pass, a $10-per-month subscription that provides unlimited access to a selection of games and competes directly with Sony’s PlayStation Plus. . . The strategy of the American giant, which consists of betting everything on the software, is exactly the opposite of that of the Japanese, which does not stop praising the hyper-realistic graphics of its PlayStation 5.

Sony’s share price has increased eightfold in eight years, making the last few years one of the best periods in the history of the group, which is celebrating its 76th anniversary. The announcement of Activision’s takeover bid caused Sony’s shares to fall, which lost almost 13% last Wednesday, to recover 5.8% the following day. To stay on top, it’s critical to adapt to an ecosystem where Netflix, Apple Music and other Amazon Primes build direct relationships with consumers through subscriptions.

In video games, with its subscription to PlayStation Plus sold directly to gamers, Sony is increasingly closer to Netflix, a strategy that, according to investors, explains much of the behavior of the title on the stock market.

Sony Pictures Entertainment, the subsidiary specializing in movies and series, has opted for a strategy worthy of an arms dealer: sell to anyone who wants to buy (this is what it does in particular with the Seinfeld series, now streaming on Netflix). Sony Music artists, including singer Adele, are heard much more on non-Sony platforms, starting with Spotify.

In video games, with its subscription to PlayStation Plus sold directly to gamers, Sony is increasingly closer to Netflix, a strategy that, according to investors, explains much of the behavior of the title on the stock market.

Ten years ago, video games accounted for an eighth of the group’s turnover, which lived mainly from the sale of televisions and portable music players. Today, gaming and network services are Sony’s leading segment, accounting for almost a third of sales and operating profit.

Kenichiro Yoshida, CEO of Sony, spoke at the beginning of January, on the occasion of CES Las Vegas, in reference to the creation of “social entertainment spaces” based on what the group already masters (virtual reality devices for games football or electric). cars in which passengers could play video games as polished as on the console at home). The group’s spokesman declined to comment on Sony’s strategy following Microsoft’s announcement.

The PlayStation 5 launched in November 2020, around the same time as the latest Xbox from Microsoft, its rival for two decades. Last September, Sony had sold 13.4 million of this console, a figure that could have been higher if the semiconductor crisis had not happened there.

But for financial performance, it’s the content that counts (and it counts twice as much if it’s exclusive); this is where the Sony-Microsoft battle should begin. Since 2003, Activision has sold 400 million copies of various versions of Call of Duty, putting the game in the top 10 sales for PlayStation. And it makes gamers as fearful as investors that once Activision is in their fold, Microsoft decides to make it an Xbox exclusive.

On Thursday, Sony said it was counting on Microsoft to bring Activision games to other platforms. A few hours later, the American giant’s head of video games, Phil Spencer, said on Twitter that he had reassured Sony leaders about “the will [de Microsoft] leave Call of Duty on PlayStation.”

Analysts say that could be the case, but that Microsoft could limit distribution channels.

“You can imagine a scenario where titles like Call of Duty are released on multiple platforms, but through the cloud and Microsoft subscriptions,” said Michael Inouye of ABI Research.

According to Microsoft, Game Pass has 25 million subscribers, up from 18 million a year ago. PlayStation Plus had more than 47 million subscribers at the end of September 2021.

Analysts also wonder if Sony, which has made minor acquisitions and investments in software in recent years, might not start looking for a major publisher as well.

In China, on the other hand, Sony and Microsoft lag behind Tencent, both cloud specialists and world number one in video games in terms of billing.

Until then, Microsoft can count on one of its strengths: Azure, its cloud service. For players to play together over the Internet, powerful computers are needed to process the necessary data. With Azure, Microsoft can adapt its cloud to its video games.

Sony has also become interested in the service and entered into negotiations with Microsoft in May 2019, but no progress has been reported on this front. Sony says discussions continue, Microsoft declined to comment. According to some of its employees, the Japanese group currently relies on Amazon Web Services.

In China, on the other hand, Sony and Microsoft lag behind Tencent, both cloud specialists and world number one in video games in terms of billing. For example, Tencent’s cloud is behind games like Honor of Kings, which are usually played on smartphones rather than consoles.

At Sony, the cloud does not yet play a central role. About 60% of subscribers prefer to continue downloading games on consoles rather than play online through the cloud, according to Lisa Cosmas Hanson, market research specialist at Niko Partners.

On the other hand, Sony is ahead of Microsoft and the others in an area that could prove critical to tomorrow’s video games: virtual reality headsets. These devices also play an important role in Facebook’s envisioned metaverse, and thus could give Sony an edge (even if the group has yet to reveal any strategy on this).

Sony has sold six million PlayStation VR headsets since 2016, analysts say, and is expected to release a new version soon. Microsoft, on the other hand, has chosen to sell headsets made by others, including HP.

“We’re going to pave the way and explore technologies that allow us to deliver new experiences,” PlayStation boss Jim Ryan said in Las Vegas in early January. And virtual reality is at the core of this philosophy. »

(Translated from the original English version by Marion Issard)

Astra Pro Nulled, Woocommerce Custom Product Ad, Nulledfire, Yoast Nulled, Slider Revolution Nulled,Woodmart Theme Nulled, Wpml Nulled, Rank Math Seo Pro Weadown, Wordfence Premium Nulled, Newspaper 11.2, Fs Poster Plugin Nulled, Plugins, Elementor Pro Weadown, Consulting 6.1.4 Nulled, Avada 7.4 Nulled, WordPress Theme, Elementor Pro Weadown, WP Reset Pro, WeaPlay, Business Consulting Nulled, Woodmart Theme Nulled, PW WooCommerce Gift Cards Pro Nulled, Newspaper – News & WooCommerce WordPress Theme, Flatsome Nulled, Jnews 8.1.0 Nulled, Premium Addons for Elementor, Dokan Pro Nulled, Jannah Nulled, PHP Script

Back to top button