Big success in gaming means big money. And every year the money made by the gaming medium keeps getting higher and higher. Take 2017 for instance. According to Newzoo.com, the total money made by the film industry (Hollywood) was $42 billion, whereas the video games industry made a whopping $108 billion. This is no surprise as the investment made on games is far higher than that of a movie from an average consumer. But dig in deeper and it gets very interesting. Looking back at the Newzoo.com article, the leading money maker is Tencent games at $18.9 billion. No surprise there again, since Tencent has stakes with companies like Epic Games, Riot Games and Ubisoft to name a few. But look at the next big money maker and you are in for a surprise. The second highest moneymaker for 2017 was Sony raking in $10.8 billion. So how does a company that focuses single player experiences with barely any microtransactions make so much money in an age where free to play multiplayer games with microtransactions are accepted with open arms and are all the rage. Let’s take a closer look.
Sony’s success story actually begins back in the PS3 era when it sowed the seeds for the benefits it is reaping now. The PS3 had an abysmal launch thanks to terrible pricing combined with lack of third party support due to the intricacies of developing for the cell processor. Things were not looking good for Sony in the first few years of the PS3 and they had to do something to save the brand. This lead Sony to invest heavily in first party studios and create games with quality and versatility in mind. This resulted in great games like Uncharted, Infamous and Heavy Rain. Although these games revitalized the PlayStation brand it was not enough to make PS3 the leading platform of that generation. But Sony had something of great value in their hands. A pool of talented studios ready to make games for their next console.
Sony enjoyed a paradigm shift with the release of the PlayStation 4 back in 2013. Thanks to the blunders made by its rival Microsoft and some smart PR moves, Sony managed to gain the momentum needed to spearhead the console generation and lead it from the front. Sony started strong with first party exclusives and a strong lineup of indie titles kept the games flowing. The PlayStation 4 managed to outsell Microsoft by 2:1 in the first year. This was a time when companies had long since moved on from traditional single player games to multiplayer games with microtransaction and “games as service” models.
With a strong install base now Sony too started to focus on robust online services and other value-adds while still keeping its first party studios (now branded Worldwide studios) busy on new games. Sony realized that with the rest of the industry focusing on other types of games, the old school single player market was basically abandoned and untapped. One, which still had demand among older and mature gamers who grew up playing those types of games. And more importantly, this was something that Microsoft had a complete lack of. So, as part of a smart PR move which they maintain to this day, Sony was being more outspoken about its games and how they support single player games which people want and has showcased those games in the best ways it could.
Sony has since periodically released strong single player games with a focus on quality and variety. Thanks to the time and support provided, the first party studios have been delivering on both fronts until now. The release schedules of these were usually during the first and the last quarter of the calendar year which also helped boost sales. This further helped the sales of PS4, which in turn boosted the number of online subscriptions for PS plus, which in turn attracted more player towards the PS4 so they could play with their friends. And as such Sony’s investment in their studios and their strategy of showing people that they provide what people want has paid off in spades. No wonder they were the second largest money making games company last year.
In a nutshell, Sony has achieved all of this with a well thought out strategy that shows how well aware of the market they are. However, this is something that they seem to have decided, is of less importance now, whereas its rival recognizes otherwise. With Sony being the leader of this generation, things have started to change a bit, and Sony now has the image of an evil mega-corporation thanks to the likes of the “Fortnite on Switch” debacle. And Microsoft is waiting to bounce back with the same strategy that Sony applied years ago. “Lead with great games”. And honestly, it looks like things may shift back in Microsoft’s favour next generation but that’s a topic for another day.