Sony CFO Talks About Change In Console Cycle, PS5 A Iterative Console?

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PS4

 

As the end of the fiscal year approaches many companies are releasing their annual earnings report. This week Sony held their earnings call where the initially discussed how Sony had succeeded with the PS4.

During the earnings call Sony’s CFO Kenichiro Yoshida talked about how Sony’s console cycle had changed as there has been a shift towards digital userbase, subscriptions and microtransactions.

Here  is what he had to say:

“PlayStation is a console, that’s the main thing, the foundation. With the cycle of the console, the performance business results may vary along the axis of the console. 2 trillion yen was the sales for this fiscal quarter, more than half of that most likely will come from Network and for this fiscal year the unit sales are approaching the level of last year. There are mitigating factors that affect the console cycle so far.

For one thing, the business model used to be B2B royalty model, but now it has shifted to a direct-to-consumer model.

And in our business, main access to hardware is important, but rather than hardware, the number of users is getting more important–monthly average users, numbers of PS Plus subscribers, etc.

And also how much time are they putting into this console–the ARPU? So the axis seems to be shifting from hardware to userbase.

Thirdly, there’s a change of revenue cycle. Clearly, in-game sales, for example: after the customer’s purchased the disc or after they download the software, then they can purchase items or offerings. So the in-game sales proportion is increasing.

With all these points, the console cycle is being mitigated by these factors.”

 

As you can see from the statement it seems apparent that software is increasingly becoming more important than hardware, and it seems to echo something that Jim Ryan said recently. What this seems to suggest is going forward Sony  is going to focus more on the software side of the business rather than the hardware , and this may mean the PS5 may be an iterative console.

That might not exactly be a bad thing though . If PS5 is a minor upgrade over the PS4 Pro , and the quality of the software is consistent I see no reason for Sony to be knocked off the top of the mountain.

Sony has so far managed to keep Microsoft and Xbox One at bay with quality software offering , and I expect that to continue with the PS5 as well.

 

  • PAULO ROBERTO

    What an absolute pile of nothing this article is.

  • Lodmot

    If the PS5 will be only marginally different from the PS4, I’ll definitely be done with any game console hardware besides what Nintendo puts out. I’m in the process of building a console-sized PC gaming rig which will be my main platform for gaming. Microsoft is probably going to follow suit with what Sony does, as they’re direct competitors with each other. The only thing that’s actually good about those consoles in my opinion is the controllers — they’re amazing.