Opinion Piece: Sony’s (SNE) Goal At E3 – Make The Competition (MSFT) Look Bad

Alright, so I was quite annoyed to see everyone hopping on the bandwagon at E3. Sony’s strategy at E3 was simple: Make the rest look bad and exploit it as much as possible and it worked out quite well for them. Here’s why it still might not be sufficient

MSFT VS SNE: The Tale Of Two Giants

First of all, look at what Microsoft has achieved over the past ten years and how many opportunities Sony missed. I learned a few things about companies the past few years and one thing that is very apparent: Turnaround stories are rare. If you miss an opportunity once, it will be a lot of work to get a second chance and most of the time companies will go bust. Companies like HP, Sony and Logitech are struggling, because they did not manage to adopt quickly enough to modern trends like tablet PC’s.

Microsoft, admittedly is very slow with adoption too – but when they finally adopt something (Windows 8 is steadily growing and the Lumia is becoming a viable alternative) they are like a bulldozer and usually over-deliver. MSFT has a great management and their quality assurance is top notch. Obviously, they have a few cash cows like Excel and Windows that constantly bring in stable revenue and they can simply build upon that.

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Sony on the other hand missed opportunity after opportunity. Not only did they fail to respond to competition from Apple, they also lost a huge chunk of the console market share to Microsoft over the past few years. I’m not saying they will go bankrupt soon, but I do not expect them to win the next-gen console war

Used Games Policy: Big Plus For Developers Will Result In More Exclusive Games For Xbox One

Microsoft’s policies are obviously not as consumer-friendly as they could be. Not being able to play used games is a bummer, but on the other hand game developers will embrace Microsoft’s new console and MIGHT be more inclined to release their game exclusively for Xbox-One. If I had spent millions on a game I surely would like to sell as many copies as possible. In the end, this will be a plus for developers and supporting the devs who make those great games is not such a bad idea after all, is it?

Consumers In Key Markets Are Online 24/7

The other controversial policy is the “always-on” policy: Well, I admit this will be a problem for developing countries, but for most consumers from key markets like the US, Europe and Australia this won’t be a problem at all, they are on all the time anyway.

Bullish Bets On SNE?

However, things are definitely brightening up for Sony. The introduction of their 4k lineup and the upcoming Playstation 4 will surely bring in some cash – temporarily. So a bullish bet on SNE is not what I’d call stupid, however I still would be very cautious, here’s why:

Sony missed too many opportunities and need a win BADLY. Microsoft on the other hand has a big budget (they will reportedly spend 1 billion on building up the Xbox One ecosystem) and can more actively support the console development and fund tons of unique IP’s and new game studios. Sony will not be able to do the same. Quality might suffer in the end. However, looking at how well perceived Sony’s flagship MMO Planetside 2 was, it’s obvious that Sony CAN actually deliver.

MMO gamers and free-to-play enthusiasts will definitely consider the PS4, but gamers that care a lot about new, innovative games and look forward to get theirs hands on many games as possible will not miss out on the Xbox one. Simply because it’s currently “trendy” to hate the Xbox-One doesn’t mean it will be when the console hits the market.

To all possible SNE investors: Carefully reflect on Sony’s long-term console strategy. They might be onto something, but opinions change quickly and they might not sell as many consoles as anticipated, resulting in a sharp decline when official numbers are released

Disclosure: I am currently not invested in SNE,MSFT

Published: Wednesday, June 19th, 2013 Last Modified: June 19, 2013

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