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Wednesday, November 1, 2023

PlayStation Is Making Bad Investments, Bad Decisions

Last of Us Factions

Naughty Dog

Sony’s PlayStation is extremely good at two things: Making a console people want to buy, and having its devs make great single players games for that console.

This has been consistent for generations now, but in 2023, Sony no longer believes it to be enough. Game budgets are ballooning and these games can’t just be good, they have to be megahits. So, the company is looking to expand in a number of ways beyond this formula.

Unfortunately, it always feels like its missing the mark. In terms of products, in terms of genre investment, in terms of acquisitions, in terms of its use of time and resources.

To be absolutely clear, Sony’s devs are still killing it when it comes to producing the kind of quality first party offerings the brand is known for. God of War Ragnarok, Ratchet and Clank: Rift Apart, Marvel’s Spider-Man 2, easy GOTY contenders ↗ building on a legacy of great games. There is rarely any doubt that Sony Santa Monica, Insomniac, Guerrilla, Sucker Punch or Naughty Dog will deliver a good game. Microsoft, for all its acquisitions, still can’t say that.

But Sony itself is all over the place when it comes to other areas of its business. They have leaned hard into VR, selling two VR headsets now in an industry that has seen slow growth and adoption of the tech. They’ve done well…within that niche, but there is no indication VR is anywhere close to the mainstream even after close to a decade now, and it feels like this is a strange place to continue to sink so much blood and treasure.

CHIBA, JAPAN – SEPTEMBER 15: An attendee wearing a Sony PlayStation VR2 (PS VR2) headset plays the … [+] Biohazard Village, known as Resident Evil Village outside of Japan, video game in the Capcom booth at the Tokyo Game Show 2022 on September 15, 2022 in Chiba, Japan. The event runs for four days from September 15-18 and takes place for first time in three years, following a hiatus due to the coronavirus pandemic. (Photo by Tomohiro Ohsumi/Getty Images)

Getty Images

Similarly, Sony is also producing a handheld “Q” device which will play PlayStation games via remote play, but that’s it, and it needs Wifi to work, and will not play any games internally. It’s a third of the way to being a Switch competitor, but stops well short of both that system, and of fully bringing back something like the Vita or PSP.

Then we have the new PlayStation 5, which will make its disc drive optional, but somehow actually raises the overall price for the digital model. Indications are the company then may also produce a Pro model later in a generation that really would not seem to need it.

That’s just hardware, however. Another column of Sony’s recent plans, announced before Jim Ryan left, was that it was making a huge pivot toward live multiplayer games, that it would increase investment so that live content was 60% of its budget. This is an effort to free themselves from making purely one-and-done single player games, instead wanting Fortnite/Apex/Warzone type games that print money all year long.

To orchestrate this, Sony bought Bungie for $3.7 billion. Bungie has been running the Destiny franchise for a decade now, one of the only successful live service PvP+PvE games on the market where so many competitors have failed. The idea was that Bungie would teach other mostly single-player studios how to make live service games, since it had done so well in the genre.

Destiny 2


So far, that has not panned out at all. Despite most big Sony devs tasked with making some kind of multiplayer game, the most prominent one, The Last of Us Factions, was looked over by Bungie and declared not ready for prime time. That project has now seen resources siphoned away from it, and it’s not clear if it will ever actually make it out. There is a long history of talented single player studios failing to branch out into live service games, Crystal Dynamics (Avengers), Gearbox (Battleborn), BioWare (Anthem), but Sony seems content to ignore all that and believe they can do it differently. So far, that has not materialized.

Bungie itself has now started to flounder. This week brought mass layoffs to the company as Destiny 2 struggles after seven years of existence, an especially bad expansion this year and an uncertain future. It may be delaying ↗both its next expansion and its next IP, Marathon. And Sony failed to secure any sort of exclusivity deal during this purchase, meaning all Bungie’s games from here will remain multiplatform.

Finally, Sony went absolutely off the rails attempting to stop Microsoft from its Activision Blizzard acquisition, hinging their argument on the idea that Microsoft would make Call of Duty exclusive to Xbox and take away a huge moneymaker from them, when internal emails revealed they did not believe any such thing would actually happen. While regulators did adopt many of Sony’s talking points, they were not good ones, and the deal has gone through. Sony spent an enormous amount of time and money and reputation on that fight for…nothing.

Again, PlayStation is continuing to sell consoles and make great, quality games. But all efforts outside of that as of late have felt like a string of poor decisions and poor investments. We’ll see what happens next with these live service ambitions, but it feels like a larger, public change may be coming.

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Pick up my sci-fi novels the Herokiller series and The Earthborn Trilogy.

Kaylie Pferten
Kaylie Pferten
A pilot of submersible crafts in a former life, now married to my husband David and writing about investment advice.

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