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Pachter: “Sony Is Not Big Enough” to Afford Paying Publishers for PlayStation Now like Netflix Does

Wedbush Securities analyst Michael Pachter is known to be very vocal in his judgment of the initiatives of console manufacturers, and according to him Sony simply isn’t big enough to foot the bill that would entice publishers to put their content on PlayStation Now.

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Punch-o1708d ago

Just like PS+ right? Pachter....

Abriael1708d ago

Yeah I agree. Sony seem to have plenty money when it comes to buy factories and invest billions in their expansion lately.

GarrusVakarian1708d ago (Edited 1708d ago )

It's just Pachter being Pachter, move along.

Pachter, the biggest troll in the gaming industry.

@Punch-o

"Just like PS+ right? Pachter...."

Exactly.

Abriael1708d ago (Edited 1708d ago )

@Lukas_Japonicus: to be completely honest I find his insight always very interesting. Not because he's right, plenty times he isn't.

It's because as an analyst, he deals with investors, and he gives us the point of view of investors, which, like it or not, is what Sony, Microsoft and Nintendo have to deal with.

Most analysts don't bother to explain that point of view in gamer terms, and that's something I appreciate of Pachter, as cracked his crystal ball may be.

Bundi1708d ago

Not to be that guy, but SONY has also had to sell multiple buildings and whole divisions so I wouldn't lead with that. Also, what billions in expansions are these?

Abriael1708d ago

@Bundi: they're spending 35 billion yen in purchasing and expanding one of the most advanced semiconductor factories in Japan.

Also @selling buildings. That's called the nature of business. You sell what you don't need and you buy what you need.

They sold a building, and they purchased a massive campus in Silicon Valley
https://www.youtube.com/wat...

fr0sty1708d ago

Um... a company that owns half of the entertainment industry and a good chunk of the consumer electronics industry (among other things) isn't big enough to pay publishers for their content based on usage the way a company that does nothing other than streams movies over the internet can...

ok

abzdine1708d ago

sad too many posts on an article about an incompetent guy who is specialized in saying rubbish..
he clearly doesn't know how this business works.

fr0sty1708d ago

He knows he's full of shit too. That is why you're seeing less of him as an analyst and more of him as a media pundit on various gaming sites. They don't take him seriously in the analyst world either, and Pachter knows that the best way for him to keep a check coming in is to market himself as someone who says controversial things to drive hits to websites. Since he has elevated himself to a position of authority in the gaming world, with the help of a few gaming media outlets along the way, he now can market his flame bait to the highest bidder and they'll buy it up. So will we, which is why we're here commenting. All part of his paycheck.

GTgamer1708d ago

Quick question doesn't Video unlimited and Music unlimited have a crap ton of content? so if Sony can get all that on their services then I don't see any difference in them attaining content for PSNow.

Eonjay1708d ago (Edited 1708d ago )

I can't be the only one who has notices that Netflix doesn't offer brand new releases. Netflix and PSNow are legacy collections with new content added monthly. Otherwise these publisher wont make any money from these games. I think Sony has this one in the bag.

@GTgamer:

Stop making sense.

LogicStomper1708d ago

"Sony seem to have plenty money when it comes to buy factories and invest billions in their expansion lately."

I wouldn't necessarily agree with that. Currently, Sony isn't in the best financial position and I do hope they get better.

Source: http://www.businessinsider....

truefan11708d ago

Lol i don't know what earnings reports you have been ready, but everything is not peachy. They are selling off assets because their credit rating is junk and they can't borrow to raise capital. I think Sony will be playing it safe this gen, they will not invest heavily in ps now because very few will buy the sevice. You Internet gamers make up a very small percentage of total gamers. All in all Sony doesn't have the money to pay publishers, hence why they focus on in house content.

Prime1571708d ago

Not just that, but remember when Netflix was small and the streaming library was "meh" at best?

dantesparda1708d ago (Edited 1708d ago )

abzdine hit the nail right on the head, why does anybody care what this clown says. Look i actually like Pachter, i find him entertaining, but its obvious the guy doesnt know what the fvck he is talking about (come on N4G, you gotta let us swear, this is ridiculous, we aint kids here)

So who cares what he says or thinks, unless its just for pure entertainment value

Love this song, so soothing
http://www.youtube.com/watc...

Giul_Xainx1708d ago

There are over 2.5 million PS+ Subscribers.... that is a possible 20,000,000 to 125,000,000 dollar purchase power of the PS+ service.... Funny thing is that pachter didn't take into account that some development teams are willing to be bought out at prices within the 500,000 dollar range.

What I need to know right now is how many new PS4 owners are coming in who will buy the PS+ Service.

AndrewLB1708d ago

fr0sty- Sony just posted a billion+ loss in 2013 and is forecasting a $1.1 billion loss in 2014. they just sold off their VAIO division, along with 5,000 employees... and are in talks to break off their HDTV business into a completely separate subsidiary. http://www.foxbusiness.com/...

Giul_Xainx1708d ago

@ andrewlb. No one was interested in the bravia or viao brands for two years now. Those brands are dead. People are looking for cheaper hdtvs. The computer market is getting killed by smartphones. The Playstation brand is going strong. They are focusing on what is currently pushing their company forward.

We may or may not see another pc or tv manufactured by Sony in the future. But as long as playstation is there I am there.

Dubaman1707d ago (Edited 1707d ago )

They have fired around 20,000 employees within the past year or so. They have sold off some of the worldwide HQ's and offices. They have even spoken about selling its TV division as its lost them money for 10 straight years. Losing Millions and Billions for 10 years. Now their biggest selling piece of hardware is being sold at a loss.
Yeah, they've bought a factory to produce better chips for its Mobile Phones. That's good news for gamers, right?
This is all facts by the way.

http://www.businessweek.com...

http://www.businessweek.com...

I just want to know why Sony's loyal fanbase will constantly say its doing amazing business when in fact its hemorrhaging money. That is not good for business or for its fans. If this was said, even by Patcher, about Microsoft or Nintendo then a lot of people would be jumping for joy. Fanboys need to stop with this bullshit.

scott1821707d ago (Edited 1707d ago )

You will see Microsoft do the same thing with windows once they aren't a commercial monopoly anymore on pc's.

This is Sony's first major restructuring of business in my eyes, the other stuff was easy. This will help bring their declining TV side to profit and it will get rid of a PC side that has been posting massive losses for a loooong time. They will be able to focus more and things will get easier... Trolls on here can't seem to see past 720p on these issues.

CAB18021707d ago

LOLOLOLOL, they have plenty of Money, BUT NINTENDO IS BIGGER THAN SONY ROFL

Death1707d ago

@Scott,

Sony and Microsoft are both looking at expanding their reach into new areas constantly. This is why both companies got into the gaming business to begin with. This is also why both are trying to have a significant portion of mobile phones. Selling off their world HQ's not only caused Sony to become renters in those buildings, but they also lost the revenue coming in from other renters along with tax shelters/write offs having real estate provides. Last week they sold off their PC division that made VIAO laptops and PC's. Spinning off the HDTV unit is huge since it is a core product in their consumer electronics division. Playstation is not enough to keep Sony going and has not been a consistant source of profit for over a decade.

dedicatedtogamers1707d ago

Wow. Seems like some of Pachter's "investor buddies" are nervous about Sony's extreme success. First he says Sony doesn't have enough 1st party devs, then he says (multiple times over multiple days) that PS Now is a joke, it will fail, etc.

People have to realize that Pachter's public statements are NOT investment advice. That is something he keeps private. The stuff he says in public is intended to manipulate the market (which makes his own job easier and more profitable). Apparently some of Pachter's clients don't like the idea of Sony gaining more foothold with PS Now...

Death1707d ago

@Dedicated,

From an investment perspective, Now goes against the traditional console business model and runs the risk of fragmenting Sony's customer base. Without a proven business model to show Now will work, it's alarming to investors. The PS4 is doing very well, Sony needs to focus on it without dilluting their own market. They also need to sell more software.

scott1821707d ago (Edited 1707d ago )

^
Agreed, I don't think anyone said playstation would be, and they don't need it to. Everyone is aware of why Sony sold buildings and laid people off. They are late to restructuring their TV business, Samsung and others already did, Sony made mistakes but they have enough to more than do ok in the future.

And you can bet once MS isn't a software monopoly anymore they will have a much harder time than Sony.

Sony is feeling the heat right now because cheaper alternatives in electronics are more popular now, but Sony doesn't need to become a "cheap brand" to reach profit again. It's funny that the only people taking shots at Sony about this are the usual suspects anyways.

P.S. they are doing just fine without "now" but it will only strengthen their line of electronics outside of playstation by allowing purchasers of said sony electronics to play games without a playstation and their streaming movie and live tv service will unite their products. The press has been nothing but positive about it aside from Patcher. The PS4 has sold more software than the x1 and outsells them in software and hardware weekly, no problem there.

SITH1707d ago

You can make up anything you want. But it does not look anywhere near as good as people want it to look for Sony.

http://www.macroaxis.com/in...
http://money.cnn.com/2014/0...

morganfell1707d ago

Apparently Mr Pachter is quite unfamiliar with the manner in which Sony has thus far revealed PS Now to function.

To date Sony had discussed Now as the most efficient medium to deliver it's CURRENT catalog of PS1, PS2, and PS3 titles. Considering the recent innovation in HD upscaling of PS2 titles and the rumors:

http://www.eurogamer.net/ar...

This would offer an enormous attraction to gamers. Add to this the seemingly forgotten patent which Sony filed last year:

http://www.ign.com/videos/2...

and suddenly it begins to make more sense. This plan has been in action for some time. Sony could, with a very low expense offer trophy ready PS1 and PS2 titles in HD. A sure boon.

But of this, like so many other matters in gaming Mr. Pachter is completely ignorant.

Also Pacter ignores the fact that new games wouldn't necessarily be covered under Now. he completely bypasses this very real probability in favor of vomiting his ridiculous, uninspiring advice.

New third part titles on PS Now would likely be available for the same price as the disc disc versions. The advantage would be the player does not have to download said digital title (unless they wanted) and would be free to stream it on the devices offered in the Now envelope.

Again such common likelihood is beyond the grasp of this doddering jerk Pachter who continues his remarks which do nothing but damage an industry in which his only interest is greed.

As regards his predicitions he has all the accuracy of a 20 year old Daisy air rifle. Whether by design or sheer incompetence Pachter apparently has a position for which reality demonstrates he has no proficiency. The sooner gamers turn on him in large number to make websites aware his presence is unwelcome then the better we and our respective hobby will be.

+ Show (22) more repliesLast reply 1707d ago
JoGam1708d ago (Edited 1708d ago )

Yo Pachter mouth is really starting to urk me. I swear when he retires, I'm throwing a party.

allformats1708d ago (Edited 1708d ago )

When I said the other day that Patcher was a troll, Microsoft shill and Xbox fanboy a lot of people pounced, but look at what he's saying now... Another retarded statement that total contradicts deals Sony has going on right now... Deals like free PS Plus games... Some of the biggest games in the industry, mind you: We're talking Bioshock Infinite, Metro: Last Light and other massive titles.

Again, this guy said it himself that he's very close with Microsoft. He always references Xbox when talking about gaming systems -- as if he were advertising the freaking brand...

But no, I'm talking rubbish, right? lol

Baccra171708d ago

You're absolutely correct, it's just that your detractors have a bad memory.

JoGam1708d ago

Exactly. I tried to give this man credibility long time ago but that must end. No more Pachter. Phuck you from the bottom of my heart.

Dubaman1707d ago

The way you prove Pachter wrong is by saying Sony gives away games on a subscription based service? The sign of a growing business is expansion, not taking constant losses and firing employees. Pachter has spewed his fair share of nonsense over the years but trying to say he's hired by Microsoft to troll Sony, now that is talking rubbish.

Doletskaya1708d ago (Edited 1708d ago )

PS Plus only allows downloads of certain games for a limited period of time, while PS Now needs to have much more content of a much greater variety available at all time. So basically the cost for running PS Now will be a lot more than the one for PS Plus if it wants to attract a lot of users. And the bad sign is that even PS Plus wasn't able to do that until Sony made it mandatory for PS4 online play.

Also, when he said "Sony’s not big enough to afford to pay that kind of dollars", I think he meant that Sony can't for now afford the level of cost of running PS Now that can make it attractive enough to be a profitable business, which I agree with because not many people will pay 10 bucks a month if the library is extremely limited and only has old games or only ex generation games.

Overall, it is just hard to imagine a gaming subscription based service like PS Now will be an easy success or a success at all.

Doletskaya1708d ago (Edited 1708d ago )

And for those who are referencing Sony's acquisitions to show that Sony can afford it, notice that acquisitions and cost of running a business are very different; one is an one-time cost and one is an on-going cost.

Sony may be able to afford paying millions of dollars one time to acquire a piece of land, but that doesn't mean they can afford millions of dollars in publisher loyalties per year especially if PS Now can't attract a substantial amount of loyal users. This is especially true when Sony's stocks have just been downgraded to junk status. Having a nonprofitable PS Now which costs millions of dollars to run per year will literally destroy their whole business.

Moreover, considering that Netflix is already paying a crap load of money to have its content available when hard copy sales for movies or TV shows aren't nearly as big as the ones of video games. I can easily see how Sony can't afford if PS Now is to be ran in a model similar to Netflix

BitbyDeath1708d ago

"PS Plus only allows downloads of certain games for a limited period of time, while PS Now needs to have much more content of a much greater variety available at all time."

Video Unlimited and Music Unlimited offers large amounts of content. Not sure how many TV shows and Movies are in Video Unlimited but Music Unlimited has over a million songs available.

"not many people will pay 10 bucks a month if the library is extremely limited and only has old games or only ex generation games."

Depends on their offerings. They could do many combinations of services such as Plus, Music, Video and Now.

"Overall, it is just hard to imagine a gaming subscription based service like PS Now will be an easy success or a success at all."

Only if you think of it as old games. (which it will begin as). But the future will bring day 1 games too. Eventually removing the need of a console. PS Now is designed for the future and it's got to start somewhere.

Doletskaya1708d ago (Edited 1708d ago )

@BitbyDeath

Are you seriously comparing PS Now to Music Unlimited? For starters, the majority of revenue for musicians don't come from physical or digital copy sales, while a game publisher's revenue does. So it will cost a lot more to run a game streaming service than a music streaming one.

So unless in the future people don't buy physical copies of games anymore or there is a way to pirate games as easily as music, PS Now won't remove the need for consoles cause it won't be profitable for Sony.

dantesparda1708d ago (Edited 1708d ago )

@Doletskaya

Im sorry but i just couldnt help but crack up as i read your comments. Its funny cuz back in 2005/2006 when i was heavy into doing stocks MS's stock was at $35-40, guess where its at today almost 10 years later. Less! hitting a high of $36 and some change. So dont think MS is this glorious stock. Its great for swing trading though, I'll give it that, but so is Sony's. If you had bought Ms' stock one years ago you'd be up $11 dollar a share today, if you had bought Sony's stock a year you'd be up $10. Not a big difference there eh?

BitbyDeath1708d ago (Edited 1708d ago )

"Are you seriously comparing PS Now to Music Unlimited?"

See your problem is you're expecting way too much from this service.
You're thinking everything will be available day 1 and everything will be stream-able day 1.

I believe it was already said that you can rent/purchase/download individual items. It may even be possible you can stream for a month/year on selected items. (Much like Japan PS+).

You will never be able to stream everything for a once a year/month fee.

Even Netflix has to shuffle content, difference is they remove that content entirely where as Sony can keep it available for individual rents/purchases as that will cost them nothing.

Doletskaya1708d ago

@dantesparda What's your point? Nowhere did I mention anything about MS's stocks; I didn't even mention anything about MS. And I have nothing to do with Sony stocks being downgraded to junk status. I am just saying that having a business, possbily PS Now, that's losing tons of money will be especially detrimental to a company, like Sony, whose stock status is junk.

@BitbyDeath But the problem is general consumers aren't as forgiving as PS fans. If PS Now didn't have those content in the first place, many people wouldn't subscribe to it. If not many people subscribed to it at the beginning, Sony wouldn't earn enough from the business to expand it so that more games would be on it unless they would risk spending their own cash reserve to pay huge amount of royalties in hope that the amount of games resulted would attract more subscribers but that was both risky and hard to do. So at the end of the days, it will take A LOT for PS Now to be considered a success if it is a service similar to Netflix.

The good news is that PS Now is an impressive piece of technology, and the key to its success, in my opinion, is to have a different model compared to Netflix. Specifically, I think Sony needs to be creative in terms of how they utilize PS Now. A subscription-based or rental-based steaming sounds like the conventional way to go, but that is not gonna work with video games, which has been proven numerous times by businesses that have failed.

BitbyDeath1708d ago

Yep, guess it is just too early to tell how the content will be delivered.

Hopefully we'll hear more at E3.

AndrewLB1708d ago (Edited 1708d ago )

Dantesparda- Why are you make stuff up? If you bought Microsoft a year ago you'd be up $10, and Sony you'd be up $1.85

http://finance.yahoo.com/ec...

And if you had bought Microsoft 5 years ago, you'd be up $19, and with Sony you'd be at a loss of $2.00 per share.

http://finance.yahoo.com/ec...

Sony's stock has cratered since it's $39/share price in 2010, or even worse... it's $60/share in May of 2007, well before the financial crash.

seriously though... don't people understand that it's very easy to check check things like stock prices? So why lie and make up numbers to make the company you love look good?

I keep my money well away from blue chips these days. The last one I owned was AMD back when they were $60/share and the stock split. i made out like a bandit since I bought it just under $15/share. They're now at $3.47/share. sad...

Death1707d ago

@Dante,

Microsoft is a Blue Chip stock.
http://www.bluechiplist.com...

Sony's stock is considered "junk stock".
http://www.thewrap.com/sony...

Stock value is important if you are buying and selling it to make a profit. This is where daytraders make money. Investors are not buying stock to sell, they invest to reap dividends. Sony hasn't paid dividends in 5 years.

If you bought Sony stock a year ago and sold it today, you made nothing in dividends and you may make anywhere between $1 and $5 depending on the time of day you bought it. Sony stock has not recovered since stocks bottomed out from the recession that hit in 2008. http://investing.money.msn....

Microsoft stock bought last year paid dividends and is worth $10 more a share if you sold it. It has not only recovered but is at an all time high. http://investing.money.msn....

+ Show (6) more repliesLast reply 1707d ago
GribbleGrunger1708d ago (Edited 1708d ago )

Sometimes I really can't understand how Pachter thinks. It's not a matter of paying publishers for content, it's about demonstrating the model works with your own IPs. Once those spreadsheets show an increase in sales, publishers will approach Sony.

JoGam1708d ago

Pachter is retarded and you know it. Thats why you can't understand how he thinks. He puts all his random predictions and comments in a hat and pulls out what to say next. The dude is clueless.

CrossingEden1708d ago

The person above you literally just explained how this logic works. -_- Try commenting without the sony bias.

KonsoruMasuta1708d ago (Edited 1708d ago )

The money from licensing fees is the only money Publishers will see. If Sony is doing this as a subscription service, they are making the money. I doubt publishers will want to put their games on a service for free.

If they sell games individually, that's a different story. That way they can give devs a cut of the loot.

HomerJDog1708d ago

believe it or not Sony ain't doing that great. they might be doing great on the gaming side but everywhere else they are not selling well. Sony is even selling parts of their line up

hellzsupernova1708d ago

yeah im sure netflix pays per view of a movie, tv show etc. I dont see why sony cant do the same.

Gamer19821708d ago

People gotta understand how playstation now is gonna work and how netflix and games work.. PS+ works as devs allow there games to be added in return for ad space etc.. Usually no cash is paid for those games (there was an article on N4G a while back). Netflix vs PSnow is a biggie itself as look at the cost of a new movie vs a game. A Game is nearly 3X the cost. So unless Sony charged 3X the sub of netflix they couldn't get content as new as netflix does.

Then they would also need the subscribers netflix have to make it worthwhile. Two problems with this. Netflix does so well as they have 44 million subs (and ggrowing) and thats because you can get netflix on nearly any device including your mobile phone. Although PSnow will be on a few devices at launch it will be limited. Second problem is no way near as many gamers as movie watchers as lets be honest everybody watches movies but not everybody watches games. So netflix has an appeal to every person on the earth where as psnow audience has a potential pull of around 50 million (taking ps3 sales over lifetime and dividing by 2 for dead consoles etc)?

Blaze9291707d ago (Edited 1707d ago )

I don't get how a guy who went to school, got a degree, and has a job in this field with years of experience, is somehow the wrong one to a bunch of N4G internet gaming commentators who seem to know way more than he does.

Now that, just boggles me. I'm not saying he's right...but I'm not saying he's wrong either. Why? It's not my job and I can admit, i have no knowledge about this field. Unlike the rest of you.

trouble_bubble1707d ago

Jack Thompson had a degree too. There's no school for common sense. And tbh, if I went through all the same edumacation that Pachter did , I wouldn't be wasting it talking about videogames on GTTV.

r1sh121707d ago

Sony are selling divisions to fund this stuff.
I mean Vaio just got sold, the TV arm are next.

Its a good move, those electronics items were not doing well in comparison to others.
Even the film studio/publisher etc.. Is doing quite bad, this is the massive restructure Kaz has created and its working.
@fr0sty @Bundi - Sony have sold massive divisions and buildings.
35 billion yen = 300ish million $'s which is still a significant amount but in the overall losses its minuscule.
How did they get that money? from ps3/ps4, selling insurance (number 1 profit maker for sony), and selling assets.

Its being done correctly. They are getting closer and closer to being in a very strong financial position but it will take a while before the accounts reflect it.

showtimefolks1707d ago

patcher wanted xbox one to outsell ps4 so badly and now he is trolling sony it seems daily

360ICE1707d ago (Edited 1707d ago )

Where do people get these things? Pretty sure Pachter predicted PS4 to outsell Xbox One from the beginning. Also, he said that PS4 was kicking Xbox One's butt in terms of sales.

If you have some sources, then that's great, if not then it's not a good thing to lie about what other people have said.

showtimefolks1707d ago

360ICE

he said because xbox one has more features and is like a TV box that more people will be interested in it and even at that price tag could see ti selling or even outselling ps4. any moron out there could have said ps4 will out sell xbox one, its common sense

common sense is something Patcher doesn't have or use

360ICE1707d ago

Yeah, he said that before he even knew how much the machines would cost, and he was wrong, but if he "wants xbox one to outsell Ps4 so badly", why would he now constantly reiterate that he belives PS4 will sell better?

November 2013
http://www.gamingunion.net/...

January 2nd 2014
http://www.vg247.com/2014/0...

I mean, he even said that Sony fully intends to kick Xbox One's butt:

http://www.psu.com/a022227/...

Pachter makes a lot of bold claims, and is often wrong, but this notion that he's somehow a fanboy, is incredibly paranoid. He puts everyone down.

+ Show (9) more repliesLast reply 1707d ago
Bundi1708d ago

I'd wait to hear the price plan first before declaring this a fail there Mike.
Their other game renting service seems to be working out great for them so perhaps they can pull this off as well. I mean I doubt Sony would go as far as announcing the service if the didn't already have publishers lined up for it...

Catoplepas1708d ago

Why would Sony have to pay? It's just another method of content delivery. If anything I thought the reverse would of been true.

jackanderson19851708d ago

Because they'd be giving out the games for free practically. They'd have to pay the content owners a licensing fee to use their content. Similar to how Netflix works

KonsoruMasuta1708d ago (Edited 1708d ago )

Why would you think that?

JackAnderson1985 is right. Sony would have to pay licensing fees, which can add up.
Netflix spends around 2 billion a year on licensing fees. I'm curious to see how much Sony will be willing to spend. It's a little better for Sony though; they have plenty of first party games that they own the rights to.

It's not like they can just grab a developer's game and put it on PSNOW when they feel like it.

iNathan1708d ago ShowReplies(14)
Majin-vegeta1708d ago

When pachter says some of the dumbest crap ever -_-/.

http://media2.giphy.com/med...

OT:Punch-o I agree.

GarrusVakarian1708d ago (Edited 1708d ago )

LOL, perfect GIF. I literally feel like doing that every time Pachtroll speaks.

norman1231708d ago

yet when he talked about MS the other day, you all agree with him.