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Editorial: Sony, Next Big Software Company?

Every day we're hearing of a company running through a round of layoffs or going out of business, it's really not a happy time. Sony is not immune to the economic troubles either. Sony is talking restructuring and that involves a potential head count reduction of 16,000 jobs due to plant closings.

This leaves Sony with some hard decisions. Restructuring can mean drastic changes that effect all their product lines. The PlayStation 3 isn't currently a shining example of high profit margins. The console needs time to reduce its overall cost, chip sizes and bring profitability. Is it in danger?...

...Is this just a case of a fearful executive [Stringer] trying to lay plans for a more stable future? Software is easier to develop, pays for itself quickly and becomes pure profit as it ages. Hardware requires constant upkeep at manufacturing facilities, chip reductions and a boat load of quality planning for first shipment. Would Sony go full software?

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Homicide3228d ago

The PS3 lost a lot of money and support. Just axe it Sony and start doing games for other consoles.

Nathan Drake3228d ago

You're dying to play KillZone 2 aren't you?

Maddens Raiders3228d ago (Edited 3228d ago )

I just praised you in the forums, but this is just lunacy.

"The PS3 lost a lot of money and support. Just axe it Sony and start doing games for other consoles."

Why would they do that when their 1st party titles are king and they can pour as much money, resources, and energy into refining those titles to make them the best looking games on any system to date, yet they only run on the PS3. Why would they go throwing a bunch of money into developing games they would have to "dumb down" for other systems and subtract from the integrity of the game. Imagine KILLZONE II on the Wii.

will113228d ago

This will never happen. Microsoft will always be the best software company. Press disagree if you agree.

no-spin3228d ago

Sony does expends millions on their games, they are truly committed, but reality is that they do not sell really well. Decent, but not as Gears 2,or Halo
Truth is, their advertisement SUCKS!!!!
the games are awesome though

RussDeBuss3228d ago

get sony oput of the hardware game?

leaving last gen wii, and ms hardware that does not push any boundaries and is an unreliable design.

and without competition ms will make even worse stuff and make you pay for even more stuff that should be included, wi-fi, hdd, live, chargable controllers.

without competition who knows what else they would mak you pay for

ultimolu3228d ago

Are you out of your f*cking mind?

Cajun Chicken3228d ago (Edited 3228d ago )

Hmm, Halo, Gears, Forza, PGR, Crackdown...

Jak and Daxter, Ratchet and Clank, Resistance, Uncharted, Medievil, Ape Escape, Wipeout, God of War, Original 3 Spyro games, Original 5 Crash Bandicoot games, Ico, Shadow of the colossus...list goes on.

Yep. I think I've proved your arguement wrong.

Marquis_de_Sade3227d ago (Edited 3227d ago )

Has anyone ever considered the reason that individual PS3 games don't sell as well is because the PS3 has a more varied library of exclusives as opposed to Gears of War and Halo? No one game sells that well, but combined they stack up, also games such as LBP will no doubt have long legs in terms of sales.

Sure, the PS3 isn't the roaring success that the PS2 was, but it's slowly gaining momentum and I imagine it will have a strong 2009.

+ Show (5) more repliesLast reply 3227d ago
rucky3228d ago (Edited 3228d ago )

I've been saying this for quite some time now. Sony should continue making hardware and start software development or at least affiliate themselves with a good software companies like Apple or Google for their products.

@2.1 Both actually. Sony is a quality hardware company so I don't see no reason why they should stop making them. But it seems unlikely due to these economic times.

JonahFalcon3228d ago

Did you mean DIScontinue making hardware? Otherwise, that statement makes no sense.

socomnick3228d ago

im pretty sure he did not read the story. he probably believes the story is about sony making pc software something sony has no clue in.

Darkseider3228d ago (Edited 3228d ago )

It would be foolish for Sony to do any such thing. With the massive investment made in the PS3 as well as the longevity the unit is destined to have I cannot see this being anything more than a knee jerk reaction. The recession has hit a lot of companies hard and the most prudent move would be to restructure to reduce costs and stay the course. IF (I said IF) Sir Howard does do this I can only say that Sony will no longer be a household name in my house. Not only from a game console but to its' consumer electronics as well. It would truly kill Sony as a corporation in that it would alienate the trust of millions of consumers world wide.

EDIT: Thought I would add this link to a .PDF from Sony showing it's plans on restructuring. The document was released today and there is no mention of "Going software only" but there is a lot of cuts coming to the TV and consumer elctronics portions of the company. As well as consolidation of R&D.

http://www.sony.net/SonyInf...

Pennywise3228d ago

This site is so stupid. Sony isnt bowing out of the console market. Not going to happen. maybe in 8 years if things dont turn around....

Only budget gamers and people who dont care about quality will be the cause of this. Shame on all of you people. You should hold your expectations of quality a little higher.

JonahFalcon3228d ago

They thought the same thing about Atari, too. And Sega.

Darkseider3228d ago

Apparently you did not click the link I provided.

callahan093228d ago

The thing is, Atari and Sega had a great succession of failed machines in a row before they quit it. Sega, I mean, they were pretty unsuccessful with 32x, Sega CD, Game Gear, Saturn, and then Dreamcast, and after all that it was finally time to bow out. The PS3 is already more successful than all of those machines, and it hasn't even been price-dropped to the "sweet spot" yet. It's got a ton of life left in it, you just wait and see.

+ Show (2) more repliesLast reply 3228d ago
Sevir043228d ago

The PS3 isn't causing as much of a operating loss for them as they would like to figure. when sony puts up it's operating losses, It isn't going to be just the gaming division and thats what the industry needs to understand, Sony is a Home electronics Company.

Movies (Production studios), TVs, Theatre system, Cameras, Music (record lables, Phones, portable electronics, Computers and software, and gaming are all under Sony's umbrella

So this loss that there are posting isn't just limited to the gaming department. to be exact, there gaming department has been one of there major sourcse of income and has been the most profitable out of all there other branches from there buisness tree, So please stop with the PS3 killing Sony.

they have a constant flow of cash coming in from the game department thats netting them plenty of profit to help offset the money they lost when selling PS3s. Most of it now coming from Downloadble content from the PSN game and video store, and the recently released PS Home. dont forget that they have been selling pretty steadily with the PS3, and great with the PS2 even in it's 9 years on the market and the well performing PSP and the fact that they are making an absolute killing off all bluray players and BD movies sold from just royalty fees.

they are now about ready to break even and they have had an extremely successful 2008 for all 4 gaming platforms So please stop the PS3 is doomed and Sony should ask the PS brand. If they do. Will let the world go causal and by then i'll have lost home. as ninty's blue market games is all we'll ever have.

Sony is doing fine. in the world of Buisness, operating losses will always be there, These economic times are hitting everyone. Sony as a company not as a game division is doing fine. and should have a pretty good year next year as they will always move to innovate the home entertainment market.

remember Sony the company is over 60 years old. and are pinoneers in the market of entertainment. they will always be in the market. They were successfull in the home console market and is such why they were able to succesfully launch a product in the hand held gaming market and while nmot selling like Ninty's DS it's still very successful and selling in amazing volumes. and is far from dead. people are buying it and they are making a killing and a profit on everything PSP related.

This editorial just needs to stop over analysing and let the real analysts do there job.

Epic faiL!!!!!

Fishy Fingers3228d ago (Edited 3228d ago )

Well it doesnt help that the whole first paragraph in the caption shown above is NOT part of the article but just the ramblings of the N4G contributor.

Edit @ below: Dude posting guidelines state not to add or edit the article, just copy and paste the text http://www.n4g.com/Info/Pos... . It's not difficult, you should know that if you've passed the contributor test. People use N4G to read gaming news, not YOUR impression of it.

JonahFalcon3228d ago

Yes it is.

"Every day we’re hearing of a company running through a round of layoffs or going out of business, it’s really not a happy time. Sony is not immune to the economic troubles either. Sony is talking restructuring and that involves a potential head count reduction of 16,000 jobs due to plant closings.

This leaves Sony with some hard decisions. Restructuring can mean drastic changes that effect all their product lines. The PlayStation 3 isn’t currently a shining example of high profit margins. The console needs time to reduce its overall cost, chip sizes and bring profitability. Is it in danger?"

Darkseider3228d ago

OK click on the little link I provided up top. The GAMING division has shown some of the lowest losses of ALL divisions Sony has. Granted there will be some restructuring but by no means will they kill off one of the most profitable product lines they make.

Aclay3228d ago

"....It isn't going to be just the gaming division and thats what the industry needs to understand, Sony is a Home electronics Company...."

That's exactly what I was referring to in my post. It's like Gamers (mostly younger gamers) on this site forget that Sony makes a wide range of Electronic products, not just Playstation 3's.

There's many different ways that Sony can cut costs, whether it means laying off people or lowering down production on their Laptops or Digital Camera's. Everything that affects Sony financially isn't guaranteed to affect the PS3 because Sony makes so many different products. And the last I heard, David Reeves already said that the Gaming Division wouldn't be affected.

RyuStrife3228d ago

Well Nintendo wasn't so hot last Gen(counting that the wii is this gen) either. But look at them, where are they now? So it'll be Sony's decision where they want to go next, not "supposed analysts" predicting.

+ Show (3) more repliesLast reply 3228d ago
Aclay3228d ago

The PS3 isn't going anywhere regardless of what people may think. Sony has already laid out the 10 year life cycle for the PS3, they are just around the corner from breaking even on PS3 sales, there's boatloads of PS3 exclusives in development, and as long as there is competition, there will always be a Playstation console on the Market.

Sony has always been a Hardware company and produces some of the most high quality products on the market, and I don't see them going strictly into Software because Hardware is what Sony knows best.

"Let’s face it, Sony isn’t SEGA, they’ve been developing hardware for consumers since anyone can remember and they’ve been doing it with quality and market penetration. It seems absurd to think they’d forgo hardware designs in replacement of a full software solution to the problem."

Hardware companies like Sony have been hit harder by the Economic Crisis than a company that mainly focuses on Software like Microsoft because people are spending less on Electronics.... but then again customers aren't exactly flocking towards Vista either.

As the economy rebounds and takes a turn for the good, consumer spending will increase and things will go back towards sooth sailing for plenty of companies. Immature and much Younger people on this site seem to act like Sony hasn't been through tough times before and if Sony posts a Loss then the "PS3 is teh doomed", and it's like they think the only thing Sony does is make game consoles, ridiculous.

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