It's Monday, 10 October, 2022 in Portland, Oregon and it continues to be unseasonably warm.
Thanks to anthropogenic climate change (or people being people, I guess) the air quality here is shot to hell so our youngest doesn't have outdoor school. Thanks, people.
I am still thinking out loud about What To Do With Sony PlayStation Now That Console Hardware Sales Growth Has Peaked:
I left the last installment thinking about what sort of uneasy, temporary partnership might exist between, say, Apple and (Sony) PlayStation (actually: Sony Interactive Entertainment). I realize I wrote temporary, but that's not wrong, not when I think about Apple and one of its longest lasting brand partnerships: Nike. You'd think that Apple threw Nike under the bus when Apple went and watched while Nike tried with its Fuel Band wearable, then just launched WATCH (what with Tim Cook being on Nike's board and all), and what with Apple and Nike doing the whole Nike+ Run generations ago. But they're still working together, you can still get that WATCH NIKE Edition, so you must assume that they've figured out how to work together.
You can look at the PlayStation versus XBox situation a bit like the who can learn how to do online services faster. The first version of this we had was Netflix versus The Old Entertainment Industry: Netflix moved from using the US Postal Service to move DVDs around in a stunning piece of using existing infrastructure and being very bloody minded about licensing terms on DVDs. Then, so the story goes, they went to digital distribution, because that was always the plan.
But anyway, Netflix started kicking off the whole streaming premium entertainment thing and before we knew it there was a whole tech industry versus old media industry, where nobody was sure if HBO would learn how to do streaming before Netflix learned how to do HBO-level premium entertainment. Well! Many years later, we have some data, and some new hypotheses!
(Why is this relevant? Because PlayStation is a place that develops online services for its hardware and, you'd argue, also develops online services for not-its-hardware, and suddenly now you're comparing a company with kind-of-online services with another company (Microsoft) that has rather effectively, you'd argue, transitioned from buy-once-licenses for on-prem software to the cloud, although I'd also argue that the radical shift in revenue has as much to do with Microsoft's power in licensing agreements and contract negotiations than it does in the actual quality of its software. See: Adobe Creative Cloud)
Anyway. Netflix and HBO, because here writ large again is another one of those big digital services strategy things. Here's what I think happened over the last 15 years:
So normally the question would be: can Sony get better at Microsoft-style services faster than Microsoft can get better at videogames (sorry, "content") and the answer is these are different questions. Microsoft can, modulo competition law, just go and buy studios for exclusive content and then either fuck up those studios over time or continue to build its content moat. Sony can... not do that as much. It just doesn't have the cash on hand or, I'd argue, the same kind of access to cash that Microsoft has. Sony could also buy services (see: U.S. TikTok), and again we'd have to see if they completely fucked them up too, a la Yahoo! or the succession of misguided suitors who either on purpose or accidentally ended up with being responsible for the tumblr dot com domain.
You'd think that now might be the time to go and talk about differentiation through user experience and I'm, like... kind of? It kind of matters? Google and Apple don't quite compete on differentiation through user experience. Facebook (and everyone else who feels at threat) tries to ape the social-content-sharing-thing du jour which is why even LinkedIn has stories now (don't check), and the whole thing with Clubhouse was a sharp reminder for people who should know better that some products aren't products, they're just features. Or another way: Instagram can try and match TikTok feature for feature, but if it's a different place with different priorities (sell ads) with a different culture (weird influencer scam shit) that also has a different history, then... it's not going to work.
So you're essentially back to new product development and kind of new-social-platform-development which fortunately is also the kind of thing that takes time to grow (you need a 5+ year plan for the PlayStation brand, remember) and also unfortunately, the kind of thing that takes time to grow (corporates tend not to have the persistence and patience to wait things out over such long periods).
I mean, the other thing here is that successful social platforms happen to have gotten big because they've been totally happy to burn money because they exist in the VC user data make-believe land and that's not exactly the problem Sony has here. Sony isn't really in the position to launch a giant cash-burning, loss-making games service on the off-chance that it might make it big in the future, if it wanted to do that, it'd just be super irresponsible with its hardware. No, it's got to be tied into subscription services (most likely), and it's got to at least have a decent, actual, not future, ARPU.
Is there something that's complementary to PlayStation that Sony happens to own that could be added to some sort of PlayStation-brand-led bundle? Not really. The only content Sony's got is Sony Entertainment, which is films and music, both historical acquisitions, both of which aren't big enough libraries to stand on their own, and both of which really can't be tied to a brand (PlayStation) that defines itself as being the place where Play Has No Limits in a 2021 brand ad (barely a year old!), or in a 2020 PS5 trailer, complete with brand manifesto v/o. (By the way: you/your agency lose points by using the exact same track from the Wonder Woman 1984 trailer that was released in 2019).
So then we're back to Play Has No Limits and I'm super curious as to what people think when they hear that and what they think of the PlayStation brand. Because the other thing PlayStation has to navigate in defining what it's going to be over the next 25-30 years is that whether this happens explicitly or not, it's as much as a brand reset. Videogames aren't what they were in 1994, which sounds trite and obvious and dumb, but what you've got with the PS5 is a company and brand that's the logical outcome of twenty eight years of history with that original brand positioning, and... well, let me just check out one of my favorite books.
The copy for that 2021 brand ad reads like this:
Welcome to a city where play is elevated to extraordinary new heights. Where every move is crucial. And the game means everything. This is Playtopia.
And the ad is pure hardcore escapism. Speed, freedom, fun, consideration, aggression, competition, driving music, chaos, tactical weaponry, shit hot cars, stealth...
Compare that to this Disney+ teaser trailer from 2019, Start Streaming Now, which encompasses everything from family friendly animation, to documentaries, to classic animation, to live action remakes, to everything from the MCU, to Star Wars, TV movies...
PlayStation has the same breadth of content as Disney shows in its Disney+ teaser. It has family friendly games, it has creative games, it has games that have made its players scream, shout, cry and more, alone and increasingly together. It has had people lining up around the block at midnight.
But the copy right now, and I'd argue the way that I'd tweak the copy given that people who started with PlayStation in 1994 are older and have kids now and PlayStation needs to clearly remain relevant to younger audiences, reads more like copy for a hardcore audience that wants to win "where every move is crucial" and is pretty defiant about it "and the game means everything". This isn't necessarily play having no limits. It honestly is more like the tone of voice and positioning that Nike has traditionally used -- that performance is the thing, and that's reflected in the way today's console wars are still fought, with specs. But that's the point with waning growth in hardware sales: tech spec differentiation isn't the only thing that cuts it.
So again, what would PlayStation mean, given that the brand took two words and made them one, and that there won't need to be a physical piece of hardware...
That's it today. Happy... Monday?
How are you doing?
Two Canadian tech companies planning hackathons to show ArriveCan should not have cost $54-million, Bill Curry, The Globe and Mail, Sunday, 9 October, 2022 ↩