The most interesting story from Sony's very mixed financials is the interim PlayStation boss, Hiroki Totoki's, damning comments on the management and financial savviness (or lack of it!) from their 1st Party studios. To sum up, while he respects them as creatives, they spend money like it's going out of fashion, and don't understand the part they play in the companies wider financial health:
On the earnings call, Sony management said the aim for its gaming business is to "optimize sales with a greater emphasis on the balance with profits."
Speaking on a recent earnings call, he seems happy with PlayStation's first-party teams, but has some concerns about the business side of things.
In meeting with management teams and visiting the studios themselves, Totoki says "everyone is working really hard to fulfill their responsibility to try to optimise the business", but feels there's a lack of understanding about "overall growth and sustainable profitability or increasing margin". He says that's SIE's main problem.
"I try to understand what is happening in the company, in the industry, and also in the perspective of the analysts, and try to explain in a transparent manner so that people can recognise and notice these issues so that we can have a harmonised approach going forward," Totoki says. He further comments that the studios and the people within them are "very highly motivated" with "great creative minds", but that there's "room for improvement" when it comes to the business itself. "And that's got to do about how to use the money or about the schedule of development or how to fulfill one's accountability towards development, et cetera."
While PD are, by all accounts, one of the smaller major studios, and deliver titles that are A/ system sellers and B/ have long sales legs, there are a couple of areas we could see change:
1/ A new PS5/PS5 Pro SKU of GT7 to take full advantage of the hardware and maximise revenue. Possibly an upgrade option for existing owners.
2/ Paid DLC, be they car packs, tracks, or something like the Hamilton Time Trial, to have a post sale revenue stream.
3/ A PC release for GT7 seems inevitable at this point and the most obvious way to increase the player-base and maximise revenue.
4/ GTWS events are lavish affairs and no doubt costly. I can see pressure being applied to increase viewership numbers and demonstrate these events improve the bottom line, ie increase Gran Turismo sales. If they don't make financial sense I can see them becoming online only with separate press events when needed.
Analysts told CNBC they expect Sony to launch the PlayStation 5 Pro this year which would offer new hardware for the release of Grand Theft Auto VI in 2025.
www.cnbc.com
Praises "highly motivated" studios
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