Sony Financials Spiraling Downward: $2.2 Billion Net Loss This Year

[james.sponge]

So, what's going to happen to Playstation in the next five years if Sony can't turn things around?

It would be bizarre if after all that noise about Microsoft dropping Xbox it ends with Sony being the ones forced to spin off Playstation (or if Playstation is the only thing worth picking up when the vultures circle).

Playstation fans need to prepare for a possible scenario in which MS will acquire Sony gaming division

So, what's going to happen to Playstation in the next five years if Sony can't turn things around?

It would be bizarre if after all that noise about Microsoft dropping Xbox it ends with Sony being the ones forced to spin off Playstation (or if Playstation is the only thing worth picking up when the vultures circle).

Nah, I think Sony if they collapse will at least die near the end of the gaming generation, just in time for Microsoft to shut their gaming division down like will obviously happen. If that happens, thats console gaming dead right there. Because all you got left is the Nintendo and their scummy console practices will keep me away forever.

I just cannot agree on this. I simply do not see the consoles going away. Neither Playstation or Xbox... and I cannot fathom why people think this is going to happen. SOMEONE would pick up the Playstation brand if Sony went under, as its obviously hugely successful. The Xbox brand isnt going anywhere, either, as it is way more popular than alot of people want to give it credit for, its just overshadowed by the even larger success of the PS4. Plus, I read that Microsoft has a RESERVE of something to the tune of 70-80 BILLION, just sitting there for a rainy day. They have it in their minds that the Xbox is here to stay, and unless THEY decide otherwise, it will.

I switched over from the PC to consoles looooong ago, but ultimately, I started on a console. The Atari 2600, followed by the NES were my first consoles. I feel reasonably sure that the numbers of people that prefer consoles are staggering, and wont be going anywhere anytime soon.

Someone buying the Playstation actually seems pretty logical.

And the Xbox brand being sunk came from Microsoft themselves. They said "If this doesn't turn a significant profit, we will shut down the whole division" you see, Microsoft Game Studios has NEVER made a profit. Ever. And all the Microsoft investors are furious and have hated Microsoft's refusal to cut it off since it was made. The Xbone would need to do a fuckload better then it has to beat the 360 and even cover its losses.

I say wait until win 9 turns them a huge profit and they will forget about it and let the gaming division roam rampant.

 

[Baresark]

I would have a Sony Smartphone if not for the fact you can only get them on T-Mobile, which is a financially stupid decision on Sony's part. Of course your smart phone is not doing well when it's only sold on the 4th largest carrier. You know how many people in my life have used T-Mobile? 2 people. Put it on other carriers and watch your numbers climb.

 

[Riff Moonraker]

So, what's going to happen to Playstation in the next five years if Sony can't turn things around?

It would be bizarre if after all that noise about Microsoft dropping Xbox it ends with Sony being the ones forced to spin off Playstation (or if Playstation is the only thing worth picking up when the vultures circle).

Nah, I think Sony if they collapse will at least die near the end of the gaming generation, just in time for Microsoft to shut their gaming division down like will obviously happen. If that happens, thats console gaming dead right there. Because all you got left is the Nintendo and their scummy console practices will keep me away forever.

I just cannot agree on this. I simply do not see the consoles going away. Neither Playstation or Xbox... and I cannot fathom why people think this is going to happen. SOMEONE would pick up the Playstation brand if Sony went under, as its obviously hugely successful. The Xbox brand isnt going anywhere, either, as it is way more popular than alot of people want to give it credit for, its just overshadowed by the even larger success of the PS4. Plus, I read that Microsoft has a RESERVE of something to the tune of 70-80 BILLION, just sitting there for a rainy day. They have it in their minds that the Xbox is here to stay, and unless THEY decide otherwise, it will.

I switched over from the PC to consoles looooong ago, but ultimately, I started on a console. The Atari 2600, followed by the NES were my first consoles. I feel reasonably sure that the numbers of people that prefer consoles are staggering, and wont be going anywhere anytime soon.

Someone buying the Playstation actually seems pretty logical.

And the Xbox brand being sunk came from Microsoft themselves. They said "If this doesn't turn a significant profit, we will shut down the whole division" you see, Microsoft Game Studios has NEVER made a profit. Ever. And all the Microsoft investors are furious and have hated Microsoft's refusal to cut it off since it was made. The Xbone would need to do a fuckload better then it has to beat the 360 and even cover its losses.

Sure, they are in business to make money, absolutely. My point is that I think they have a much longer term vision than what we are thinking, and ultimately they most definitely can make it turn a profit. That is on them, and the decisions they choose to make, in the end. So far, they have made some good decisions, and they have made some bad decisions. But they decided they wanted to make a mark in the gaming business, and after investing as much as they have in it, I dont see them stopping, not unless it was bleeding so badly that it seriously affected their bottom line, which its not. Microsoft are the only ones that know the real answer to that, obviously, and anything else is just speculation. Good for discussion and all, I guess. I will keep playing my xbox and enjoying it, and hopefully I will be able to continue to do so. I made an investment in the xbox lineup, and most certainly wouldnt have if I felt they were going to go under.

 

[Riff Moonraker]

So, what's going to happen to Playstation in the next five years if Sony can't turn things around?

It would be bizarre if after all that noise about Microsoft dropping Xbox it ends with Sony being the ones forced to spin off Playstation (or if Playstation is the only thing worth picking up when the vultures circle).

Playstation fans need to prepare for a possible scenario in which MS will acquire Sony gaming division

I had never considered that, at all. But I think Microsoft would have the money to certainly tempt Sony.

That said, just like a scenario with either console going under, is a very bad thing for us as gamers and consumers. I do not want to see Microsoft buy Playstation and get a monopoly on things, because then we would lose our biggest weapon... choice.

Choice is what made Microsoft reverse some terrible decisions, and I as an avid Xbox gamer, am very thankful for that indeed. A similar situation happened with the launch of the PS3, and playstation fans should thank Xbox for helping the PS3 straighten up, too.

The console wars are great and all, but people need to look at the silver lining. The competition between these two is a win-win for BOTH Xbox fans and Playstation fans. I hope they continue, so we can continue to reap the benefits.... so lets hope a Microsoft buyout of Playstation never happens.

 

[SonOfVoorhees]

Its the reason why the PS4 is just like the PS3 but more powerful - they couldnt risk bringing out something different as they would be in even more debt.

I'd argue against that since the gaming division seems to be the only place where they actually learned their lesson a bit. They made a system that's easier to develop for -- none of this Cell architecture -- and doesn't cost (as much of) a shitton of money at launch. They sold the systems practically on 'Look, we're not as much of a shitbag this time around'.

And seriously, what next-gen console isn't just the last system, but more powerful (apart from the Wii)?

Sony couldnt do anything too different - like Nintendo did with the Wii or like the rubbish MS wanted to do originally with the XB1. Even Sony said if the PS4 failed then there would be no PS5. But also alot of what you wrote is true about what they learnt from the PS3. But they have done a great job with the PS4 - cant imagine a next gen without a Play Station being one of them.

 

[walrusaurus]

The sad thing is that Xperia Z2 is actually easily one of the two best handsets so far this year. But its completely unavailable to 85% of US cellular custoemrs. To say nothing of the stranglehold Samsung on the US android market. The way things are this year if it doesn't have the word Galaxy in front of it the sales are going to be disappointing.

 

[Hairless Mammoth]

Man, at this rate Sony is going to drop every division except Playstation. The dropped their PC department, phones seems to be next, the TV sector isn't doing very good and who knows how their financial services are fairing. It's kinda sad a major electronics juggernaut is dying thanks to some bad decisions that could have been reverses within a couple years if they noticed them.

Their main problem is they're practically a luxury brand. Computers, TVs, home and car stereos, phones and even game systems (early PS3, and Vita *cough*too much emphasis on touchscreens and touchpads drove up the price when the second analog was all we asked for*cough*) all were too expensive for what they did. And like qwagor above me stated, other companies filled the missing market with less expensive products that were comparable in quality as Sony's. Especially in this recession, few are willing to pay extra for a PC that a Dell or Compaq beats in price and maybe performance or pay oodles more for a TV when Samsung, LG and even Vizio have made names for themselves as good TV manufacturers. That higher end mentality and the T-Mobile stupidity are what's killing them. Apple only gets away with that because their Macs and icrap have become cultural statements to many people who own them. Their PC division has basically been a side project since they realized early the power of smart phones, media players and media sales.

 

[Lightknight]

Who the heck thought it would be a good idea to go T-mobile exclusive?! *sigh*

Even if the tech were as superior as the iPhone was back in 2007 (not likely), it wouldn't make sense to pick the smallest company as an exclusive.

 

[This is re-great-table]

Sooo.. Remind me again how badly "doomed" Nintendo is?

On the less snarky side this sucks. Sony usually has the most lauded electronics, but I suppose praise doesn't sell their products.

 

[gridsleep]

So, there's no way anyone at Sony, say, an accountant with a calculator, could have spotted this trend, oh, eleven months ago? If a venture loses two hundred million dollars in one month, and then loses another two hundred million dollars the next month, a sensible person would expect at about that time for alarm bells to start ringing and red light to start flashing, not for associated parties just to keep watching until it's lost two billion two hundred million dollars. Sony is a big boy now. There is no excuse for soiling the trousers at this point.

I don't have a smart phone at all, but I like the look of the Casio hardened case model.

 

[Fox12]

Sooo.. Remind me again how badly "doomed" Nintendo is?

On the less snarky side this sucks. Sony usually has the most lauded electronics, but I suppose praise doesn't sell their products.

What I don't understand is how every company is apparently "failing." Sony is losing billions. Nintendo is apparently beyond saving. Microsoft is falling far short of its goals.

I kind of wonder what the truth really is here, since every company is breaing records, and yet their all losing money.

 

[Roxas1359]

I kind of wonder what the truth really is here, since every company is breaing records, and yet their all losing money.

In Sony's case it's more because of their other divisions failing, while only a few of them are really doing well. The Playstation division really pulled up from how it launched last gen, but at the same time the handling of the Vita hasn't been very good. Meanwhile, their other divisions are pulling them down. Really some of this should have been and could have been prevented years ago, but it wasn't and now the repercussions are strong. Sony's big problem is their pricing for one, as their TVs are really good quality but are way too expensive to buy or repair when compared to competitors, which is how Samsung pulled ahead with Smart TVs. Their limiting of their cellphones, which many say are good, is downright stupid; I mean in all honesty, I don't know a single person at my work or in my group of college friends who use T-Mobile. Their music division still has the problem the entire music industry really has now: they never adapted and accepted .mp3 format when it started.

Really, they overreached too much and spread out to far and into too many fields for them to manage. What really helped topple Rome over in the past, it was because their nation was too large to manage effectively, and Sony's in that predicament now. Will they die, no because they've still got fallbacks, but I expect them to downsize quite a bit over time which could be good or bad. We don't know yet, but hopefully they'll be fine. Honestly, I expect Samsung to be in this same situation sometime in the future because they are basically following in the same footsteps Sony did back in the day. Whether that takes 5, 10, or 20 years though we don't know.

In Nintendo's case, yeah they've got money in the bank to last them, but their handling of the Wii U at launch up until about this point has been terrible. They had a similar problem with the 3DS when it launched at it's obscenely high price. But when the 3DS was stable, Nintendo didn't focus on the Wii U and kept pumping more and more out on the 3DS, ignoring the Wii U for quite some time. Now they are finally focusing on the Wii U, but it's too late for it to be the number one seller this generation and it will most likely be the next GameCube in all honesty. Plus, their lack of creating cohesive and informative advertising has been a huge downfall on their part entirely, along with their naming convention. Many people were, and still are, confused about the Wii U due to the naming, and with things like the "New 3DS" it's only gonna get worse if they don't competently advertise. Same goes for games, as I don't think I need to mention how badly Wonderful 101 did when it had basically no advertising. Now Smash Bros just reported hitting 1 million in 2 days, but that's because Smash Bros is both a) a known franchise with a large fanbase and b) received good advertising in Japan. Wonderful 101 on the other hand was a new, exclusive IP for the Wii U, had practically no advertising at all, and was a complete financial failure because of it, despite the game being a lot of fun (bought it launch day).

Microsoft in their case don't really seem to care about how much money they really spend on things, which can be quite concerning at times. While I don't really mind them buying Mojang, I think that 2.5 billion is still way too damn much to spend on the company to buy it. They will continue to spend ludicrous amounts as well until their other divisions don't bring in as much, which may eventually happen. As someone above mentioned, Microsoft's constant attempts to go into over-saturated markets so late hasn't really been the most successful thing for them in the past. Not to mention, shareholders and investors have much more power and say in how Microsoft functions than for both Nintendo and Sony.

All in all, every one of the major console companies have made mistakes that are either biting them in the ass now, or will possibly do so in the future. The money isn't infinite, and Sony's financial problems should show that being the case. Now do I want any company to "drop out" or "go out of business"? Hell no, and no one should want that. The drop out of a major competitor would be felt all over the industry because all 3 console manufacturers have such large market shares in general. When SEGA dropped out, they were already replaced by Sony's Playstation brand, which is why the effects of a major console manufacturer weren't felt too much. With Atari, SEGA and mainly Nintendo had already replaced them so it wasn't too much. But now, I don't think there are many companies that would easily take any gap left if any of the 3 dropped out.

 

[michael87cn]

10 years from now, will there just be no consoles? Starting to sound possible. Companies can't just keep losing money year after year back to back. Eventually, that = going out of business.

 

[Malpraxis]

That guy in the picture easily spent a couple million in spray on tans.

On a more related note, I owned the Xperia T (yes, I fell for the Skyfall product placement), and I never regretted my purchase. It's an extremely durable and efficient phone, and at the time, most of the android competitors just looked flimsy. I recently went back to the iPhone fold, but only for convenience reasons (facetime, family sharing, continuity, owning an iMac and never finding an android tablet I really liked), but I'd blindly recommend a Sony smartphone to anyone who doesn't have a Mac heavy userbase among their peers/family.

 

[Suhi89]

This is a shame. My Xperia Z1 compact is the best phone I've ever used. It's waterproof, has great battery life, has a perfectly sized screen for me and is all round just nice to use. The only problem was that awful none scratch proof screen protector that was put as default on top of the lovely scratch resistant screen.

Being only on one carrier on one of the biggest markets in the world does seem like a stupid decision though.

 

[Strazdas]

how weird it is to see sony getting its ass kicked when it comes to electronics

they used to be the king of electronic devices

they still make the best quality stuff. its just that they make outdated best quality stuff and price it as if it was made from gold.

Its the reason why the PS4 is just like the PS3 but more powerful - they couldnt risk bringing out something different as they would be in even more debt.

no its not. PS4 is as far as you can get from PS3. you are right about them not risking it - they took standard PC parts for PS4 wheras PS3 was a unique creation.

I just cannot agree on this. I simply do not see the consoles going away. Neither Playstation or Xbox... and I cannot fathom why people think this is going to happen. SOMEONE would pick up the Playstation brand if Sony went under, as its obviously hugely successful. The Xbox brand isnt going anywhere, either, as it is way more popular than alot of people want to give it credit for, its just overshadowed by the even larger success of the PS4. Plus, I read that Microsoft has a RESERVE of something to the tune of 70-80 BILLION, just sitting there for a rainy day. They have it in their minds that the Xbox is here to stay, and unless THEY decide otherwise, it will.

i can see somomne picking up playstation braond. Xbox however has been a financial loss since its inception to microsoft and the shareholders have openly stated they want it gone.

Sure, they are in business to make money, absolutely.

then you agree they think dropping consoles is a good idea, as consoles are the least profitable gaming market.

That said, just like a scenario with either console going under, is a very bad thing for us as gamers and consumers. I do not want to see Microsoft buy Playstation and get a monopoly on things, because then we would lose our biggest weapon... choice.

you already lost choice the moment you bought console. any of them.

cpacha: time lord. i know the future!

 

[Riff Moonraker]

how weird it is to see sony getting its ass kicked when it comes to electronics

they used to be the king of electronic devices

they still make the best quality stuff. its just that they make outdated best quality stuff and price it as if it was made from gold.

Its the reason why the PS4 is just like the PS3 but more powerful - they couldnt risk bringing out something different as they would be in even more debt.

no its not. PS4 is as far as you can get from PS3. you are right about them not risking it - they took standard PC parts for PS4 wheras PS3 was a unique creation.

I just cannot agree on this. I simply do not see the consoles going away. Neither Playstation or Xbox... and I cannot fathom why people think this is going to happen. SOMEONE would pick up the Playstation brand if Sony went under, as its obviously hugely successful. The Xbox brand isnt going anywhere, either, as it is way more popular than alot of people want to give it credit for, its just overshadowed by the even larger success of the PS4. Plus, I read that Microsoft has a RESERVE of something to the tune of 70-80 BILLION, just sitting there for a rainy day. They have it in their minds that the Xbox is here to stay, and unless THEY decide otherwise, it will.

i can see somomne picking up playstation braond. Xbox however has been a financial loss since its inception to microsoft and the shareholders have openly stated they want it gone.

Sure, they are in business to make money, absolutely.

then you agree they think dropping consoles is a good idea, as consoles are the least profitable gaming market.

That said, just like a scenario with either console going under, is a very bad thing for us as gamers and consumers. I do not want to see Microsoft buy Playstation and get a monopoly on things, because then we would lose our biggest weapon... choice.

you already lost choice the moment you bought console. any of them.

cpacha: time lord. i know the future!

Not sure what you mean, that I lost choice the moment I bought a console. Because its not PC?

 

[Strazdas]

Not sure what you mean, that I lost choice the moment I bought a console. Because its not PC?

With a console, you are only limited to what the corporation owning your chosen console allows you to have. both hardware and software wise. however with PC, tablet and to an extent mobile phones you are allowed to choose your own hardware and software.