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Sony: Playstation Network Is Unprofitable

BARKSTAR

Banned
I've always preferred the PS3 set up to the XBOX 360. The new menu system that came along to accompany the release of Kinect I think is even worse than the one before it.

I think the PS3 offers a fantastic free service and having owned a Gold account at one stage I also agree with many that Live subscribers try way too hard to justify the price of XBOX Live. I have no problems with Microsoft charging for a service that takes up many resources to run smoothly but for the money it simply does not offer all that much more than what Sony provide for free.

I was looking forward to comparing the demo of Dead Space 2 on both consoles the other day but to try and justify a Gold subscription to play a demo of what Sony let me try for free is ridiculous.
 
BARKSTAR said:
I was looking forward to comparing the demo of Dead Space 2 on both consoles the other day but to try and justify a Gold subscription to play a demo of what Sony let me try for free is ridiculous.
I agree that Gold-only requirements for mutliplatform items sucks (though I don't ever worry about it because I've been a Gold member since Live started). Still, how often do you get a chance to even try a demo on PSN? Even now, it's extremely inconsistent and in no way comes close to the frequency and amount of free trials and demos on XBL (Silver/Free even). That fact must be factored in if we're going to talk about demos.
 

Y2Kev

TLG Fan Caretaker Est. 2009
MightyHedgehog said:
I agree that Gold-only requirements for mutliplatform items sucks (though I don't ever worry about it because I've been a Gold member since Live started). Still, how often do you get a chance to even try a demo on PSN? Even now, it's extremely inconsistent and in no way comes close to the frequency and amount of free trials and demos on XBL (Silver/Free even). That fact must be factored in if we're going to talk about demos.
On retail games? Pretty often, which I think he's talking about...

Which major retail titles have demos on 360 but not PS3?

On downloadable games, Sony is still a mess here. But the catalogs are so incredibly different to begin with that I don't think he meant this.
 

BARKSTAR

Banned
I do agree that overall, the XBOX 360 does offer the most consistent service and the fact demos and items do not need to be installed after downloading is also another great touch. It's just seems a tad over priced for what is provided as Sony are getting better and are doing so without charging for the privilege.

And as much a I love the Wii I feel sorry for Nintendo fans. I'm really looking forward to seeing how the 3DS turns out as if the next home console doesn't provide major improvements to it's online component it's going to be a major embarrassment.
 
Y2Kev said:
On retail games? Pretty often, which I think he's talking about...

Which major retail titles have demos on 360 but not PS3?
In the last year and a half or so, it's closer with retail game demos. But I intended my comment to speak about the general situation for PSN games. After all, this is a thread about PSN's profitability (which speaks of very specifically about PSN titles).
 

onken

Member
MightyHedgehog said:
I agree that Gold-only requirements for mutliplatform items sucks (though I don't ever worry about it because I've been a Gold member since Live started). Still, how often do you get a chance to even try a demo on PSN? .

You have got to be kidding me.
 

Y2Kev

TLG Fan Caretaker Est. 2009
I think that's a pretty carefully caveated statement given what (I believe) he was talking about. But, in any case, I'd say the answer to how often do you get to try a demo on PSN is often? I guess more than iOS and less than 360.
 

Mr_Brit

Banned
BARKSTAR said:
I do agree that overall, the XBOX 360 does offer the most consistent service and the fact demos and items do not need to be installed after downloading is also another great touch. It's just seems a tad over priced for what is provided as Sony are getting better and are doing so without charging for the privilege.

And as much a I love the Wii I feel sorry for Nintendo fans. I'm really looking forward to seeing how the 3DS turns out as if the next home console doesn't provide major improvements to it's online component it's going to be a major embarrassment.
Considering that:

1) They have yet to release any details on the 3DS' online service bar the shop
2) It's Nintendo

we can safely say that it's most likely going to be pretty bad.
 
onken said:
You have got to be kidding me.
No, I'm not kidding. PSN demos are few and far between for something you cannot return to the online store nor exchange, like you might be able to with a retail title. I'm talking about PSN here as this is what the thread is about.
 

skybastos

Member
I always wondered if cross chat, cross invites and earlier demos was the only difference between gold and free how many people would currently pay for live.
 
Y2Kev said:
But, in any case, I'd say the answer to how often do you get to try a demo on PSN is often? I guess more than iOS and less than 360.
Well, let's keep it between the two direct competitors, PSN and XBL. In this comparison, PSN falls well short of where they need to be and, IMO, it's a huge contributor to why the sales are so low and thus an unprofitable service (so far). Gold's sub pays for a lot of what XBL does for everyone, Free member or not.
 

snap0212

Member
MightyHedgehog said:
I'm talking about PSN here as this is what the thread is about.
PSN = PlayStation Network. Not "digitally distributed games that don't get a retail release and are priced lower than your regular retail release".


skybastos said:
I always wondered if cross chat, cross invites and earlier demos was the only difference between gold and free how many people would currently pay for live.
The question is: If online gaming were free, would people still pay for Live?
 

jett

D-Member
MightyHedgehog said:
Well, let's keep it between the two direct competitors, PSN and XBL. In this comparison, PSN falls well short of where they need to be and, IMO, it's a huge contributor to why the sales are so low and thus an unprofitable service (so far). Gold's sub pays for a lot of what XBL does for everyone, Free member or not.

If all the differences you can muster are cross-game chat and mandatory demos for PSN releases(lol) then it really doesn't.
 
snap0212 said:
PSN = PlayStation Network. Not "digitally distributed games that don't get a retail release and are priced between lower than your regular retail release".
I don't see it that way when those DD games are exclusively distributed on PSN. Those titles are part of the network's profitability.

jett said:
If all the differences you can muster are cross-game chat and mandatory demos for PSN releases(lol) then it really doesn't.
Apparently, the numbers don't agree...which is what this thread is about, right? We're talking about performance that may well decide whether or not PSN or its features continue to be free in the future.
 

Bumblebeetuna

Gold Member
GaimeGuy said:
the only platform in the last 15 years to have pay to play, peer to peer online gaming is the Xbox.

Sega Dreamcast in 2000 had SegaNet which was $10 a MONTH.

If Sony wants to make PSN profitable, get a team to design it to be as fun and easy to use as Live and then charge for it, plain and simple. If PSN was anywhere near as good as Live then I would pay for it, even if paying for it does make every elitist tard on GAF cry.
 

patsu

Member
Kaz thinks that PSN will make lotsa dough in 2012. If they can meet that target, then there's no reason why it can't be free.

They only added new videos services, new music service, and updated Home recently. They should be able to beef up PS+, PS Rewards, and PSN for cellphones + PSP (for Japan) too.
 
How are they going to make profit if they let 5 people share one game? I know thats not their intent and their new PSN policy 'discourages' people from doing it, but its still technically possible.
 

patsu

Member
Decarb said:
How are they going to make profit if they let 5 people share one game? I know thats not their intent and their new PSN policy 'discourages' people from doing it, but its still technically possible.

Need more data point. e.g. I let my friends share my PSN games, but they end up getting their own eventually.
 

Mr_Brit

Banned
Decarb said:
How are they going to make profit if they let 5 people share one game? I know thats not their intent and their new PSN policy 'discourages' people from doing it, but its still technically possible.
How popular is gamesharing, I doubt more than 5% of the PSN userbase even knows you can do it let alone the number of people who know about it and actually do it.
 
Mr_Brit said:
How popular is gamesharing, I doubt more than 5% of the PSN userbase even knows you can do it let alone the number of people who know about it and actually do it.

yeah, I'd venture to say 5% is even a high estimate if anything.
 

Raoh

Member
Consolidation is what sony needs. Just like when they merged their errickson, soe, vaio and playstation brand, they need to merge their online services. PSN+, PSN Store, Forums, Blog, SOE (station.com) and HOME need to become one service.
 

jett

D-Member
Mr_Brit said:
How popular is gamesharing, I doubt more than 5% of the PSN userbase even knows you can do it let alone the number of people who know about it and actually do it.

Mario(a GAF poster) is an employee of Sidhe, the makers of Shatter. He said gamesharing accounted to 20% of Shatter owners, so no, it's not negligible really.
 

karasu

Member
I don't get the big deal with Xbox Live. I expected to be blown away by this game changing experience when I got my 360 a few months ago, but it felt like the same ol thing. I've never used cross game voice chat at all.
 

Retrocide

Member
patsu said:
Kaz thinks that PSN will make lotsa dough in 2012. If they can meet that target, then there's no reason why it can't be free.

They only added new videos services, new music service, and updated Home recently. They should be able to beef up PS+, PS Rewards, and PSN for cellphones + PSP (for Japan) too.

I consider launching video and music services this late in the game to be a failure on Sony's part, since unlike Microsoft or Apple they own a major movie studio and a major music label. Sony failed to leverage that advantage and now have to play catch up.
 

Mr_Brit

Banned
karasu said:
I don't get the big deal with Xbox Live. I expected to be blown away by this game changing experience when I got my 360 a few months ago, but it felt like the same ol thing. I've never used cross game voice chat at all.
Hey guys I got this new Ferrari but I don't see what the big deal is about them, btw I've never gone over 40 on it.
 
Len Dontree said:
The opposite is actually true. For instance, I just bought a 1/2 price Alan Wake DLC episode with free points I got from a Bing promo (or perhaps a discounted points card from Amazon, it's all a big pool of free and discounted points in my account at this point).

Anyhoo, Sony have a long way to go to reach parity with Xbox Live, and they've been playing catch-up in that regard this whole gen. They launched without a clear vision and have been piecemealing features in willy-nilly. Shoehorning in Trophies, less exclusives on PSN and lack of mandatory demos, a general confusion about what games have what community features included, and weird and irrelevant (to me) efforts like "The Tester" and, to a lesser extent, Home; all don't mean it's a poor service to me, but it's the lesser of the two, gets much less of my playtime, and wouldn't be worth charging for anyway. Many will disagree, which is fine of course, but to say Live users are getting "raped" (a word thrown around way too casually in gaming circles) or should be livid because all they pay for is P2P is just dumb.

Then again, I think paying $15 a month to play an MMO, for instance, is odd, so to each his own is my motto. Happy Holidays!

All of that regarding PSN vs. XBL is true, but they are features of XBL that silver (free) users already have access to. When you upgrade to a gold account, you're just paying for online matchmaking. That was my point.
 
The comparisons with Steam are pretty out there. Steam primarily is the most popular source to purchase PC gaming now, it's main focus was for the use of purchasing games. PSN and Live have many different uses and lot of people on these services don't even purchase a thing. A person does not use Steam without buying products, as Steam is useless without purchasing the products through it to make use of the integrated features.
 

Dabanton

Member
karasu said:
I don't get the big deal with Xbox Live. I expected to be blown away by this game changing experience when I got my 360 a few months ago, but it felt like the same ol thing. I've never used cross game voice chat at all.

Well your looking at it the wrong way.

It's ease of use which is Lives main selling point to me. When you've gone the other way i.e Xbox 360 to PS3 you can see the main difference in how they do things.

As a Xbox 360 owner getting PS3 was a frustrating experience.
 
BARKSTAR said:
I've always preferred the PS3 set up to the XBOX 360. The new menu system that came along to accompany the release of Kinect I think is even worse than the one before it.

I think the PS3 offers a fantastic free service and having owned a Gold account at one stage I also agree with many that Live subscribers try way too hard to justify the price of XBOX Live. I have no problems with Microsoft charging for a service that takes up many resources to run smoothly but for the money it simply does not offer all that much more than what Sony provide for free.

I was looking forward to comparing the demo of Dead Space 2 on both consoles the other day but to try and justify a Gold subscription to play a demo of what Sony let me try for free is ridiculous.


I have to agree with most of these points. Only one I don't agree with is having nor problems with Microsoft charging for live.

The demo thing is specially dumb. Before I had a PS3, I saw that the Castlevania demo was up, I figured ohh let me try this, maybe I'll like it enough to buy it. I couldn't though, because the fucking demo on the 360 was Gold exclusive till about 2 - 3 weeks after the game shipped. With holding a damn demo, which I know on the PS3 is free, is not going to sell me on a live subscription. With holding a demo is also not going to get me to say fuck it I'll just buy the game at launch anyway. So 2 strikes for that plan of action there.

I've noticed a lot of the shit people are referencing as what makes live worth it, are just complete BS answers. Like the "Its guaranteed that people will have Mics!" That's not a by product of people paying 50/60 dollars a year for Live. That's because the system came with a headset.

Having used both I really just do not see any value in the few things Live offers that PSN doesn't. Specially not 60 bucks a year worth. It goes back to my feeling that this gen we're paying more and getting less. Online play for years has been free outside of MMOs and MS had to start charging for it with the original Xbox. Now they've raised the price, just like they raised the price of games at the start of this gen.
 
Dabanton said:
As a Xbox 360 owner getting PS3 was a frustrating experience.

Complete opposite here. Going from 360 - PS3 has me wondering why I bought a 360 before the PS3 in the first place. I'll take the PS3's XMB and PSN over the 360's interface and Live any day of the week.
 

spwolf

Member
i am more interested in their projections - 8x more revenue in 3 years? that has to mean a lot more full games available on PSN, i dont know how else they could raise the numbers so much.
 

-viper-

Banned
Shin Johnpv said:
I have to agree with most of these points. Only one I don't agree with is having nor problems with Microsoft charging for live.

The demo thing is specially dumb. Before I had a PS3, I saw that the Castlevania demo was up, I figured ohh let me try this, maybe I'll like it enough to buy it. I couldn't though, because the fucking demo on the 360 was Gold exclusive till about 2 - 3 weeks after the game shipped. With holding a damn demo, which I know on the PS3 is free, is not going to sell me on a live subscription. With holding a demo is also not going to get me to say fuck it I'll just buy the game at launch anyway. So 2 strikes for that plan of action there.

I've noticed a lot of the shit people are referencing as what makes live worth it, are just complete BS answers. Like the "Its guaranteed that people will have Mics!" That's not a by product of people paying 50/60 dollars a year for Live. That's because the system came with a headset.

Having used both I really just do not see any value in the few things Live offers that PSN doesn't. Specially not 60 bucks a year worth. It goes back to my feeling that this gen we're paying more and getting less. Online play for years has been free outside of MMOs and MS had to start charging for it with the original Xbox. Now they've raised the price, just like they raised the price of games at the start of this gen.
I don't even know why everyone wants other users to have mics. The first thing I do in any game is disable all voice communication. 99% of people who play games are fucking annoying. Instead I use Skype to talk to my friends when playing.
 
spwolf said:
i am more interested in their projections - 8x more revenue in 3 years? that has to mean a lot more full games available on PSN, i dont know how else they could raise the numbers so much.

Loads of LBP DLC!
 

FrankT

Member
Vyer said:
There are no real incentives for Sony to keep free online/PSN in the future.

Well I suppose the make the publishers pay a per GB download price and the sales cut they make off the games at this point just isn't cutting it.

Furthermore, he projected that PSN sales would reach 300 billion yen ($3.6 billion) in the 2012 fiscal year

Yea something seems very wrong with this math. Not sure how they could get anywhere close to that in two years with MS somewhere over a $1 billion with the subs and sales this year.
 
spwolf said:
i am more interested in their projections - 8x more revenue in 3 years? that has to mean a lot more full games available on PSN, i dont know how else they could raise the numbers so much.

I am baffled why Sony doesn't have more ps3 games on psn. MS has a bunch already on xbl.
 

snap0212

Member
H_Prestige said:
I am baffled why Sony doesn't have more ps3 games on psn. MS has a bunch already on xbl.
I think it's because they're not really selling well. There's not a single retail game on PSN that's not completely overpriced. Same goes for retail games on XBL. Who would pay twice the price for a product with less "features" (no re-selling, etc.)?
 
Gen X said:
Didn't they improve the codec in the last update?

They did update it, would hardly call it an improvement.


I was discussing this the other day with a friend (he has PS+ and I dont) and the discounted Xmas special price of Lara Croft and the Guardian of Light for PS+ users was more than XBL users whether they were Silver or Gold. From memory LCGoL was reduced from 1200 to 600 Allards which equals £5.10 and the PS+ price was reduced from about £12 to £7.95 while the none PS+ price was £8.95.

Costume Quest was cheaper on the PSN store than it was on Xbox live.

For £40 a year, I'm definitely not content with the service, it is more out of necessity than choice.
 

spwolf

Member
H_Prestige said:
I am baffled why Sony doesn't have more ps3 games on psn. MS has a bunch already on xbl.

they had a lot of fights with retail over these games, like Warhawk where retailers stopped ordering soldout game to boycott it due $40 price on PSN.

It seems retail might be more accommodating these days....
 

Gen X

Trust no one. Eat steaks.
H_Prestige said:
I am baffled why Sony doesn't have more ps3 games on psn. MS has a bunch already on xbl.

Be interesting to know how many DD full games have sold on XBL since they introduced them. Everytime I've seen the prices they are generally quite a difference in price from the retail versions. I understand they don't want to piss off the retailers by having cheaper prices.
 

spwolf

Member
intheinbetween said:
did anyone expect PSN to be a profitable online service?

didnt Apple also say that they currently dont make money on selling games and apps, and that it takes them around $800 million per year to run iTunes? I think building and running infrastructure is not exactly cheap. It sure would help if they were smarter about their bandwith, for instance, there is no reason for them not to have some kind of patching integrated for iOS games/apps, and not simply re-downloading.
 

Retrocide

Member
I'm not sure why anyone is surprised, Microsoft is a software company and has focused a lot of time and energy into making Xbox Live an integral part of the Xbox experience. A lot of the things that people are saying make Xbox live better then say PSN are software; things like ease of use and cross game chat. Sony is a hardware company, it's major focus has been on the PS3 having Blu-ray. Nintendo is a gaming company, pure and simple. Which brings me to this handy study on console use by Neilson

console-share-of-time.jpg


Nothing surprising here, Xbox users spend more time playing games online despite having to pay, PS3 users spend more time playing DVD's, and Nintendo users spend more time playing games.

Xbox360 users spend more time as percentage of use and total time playing games online then competing free game services.
 
Dabanton said:
Well your looking at it the wrong way.

It's ease of use which is Lives main selling point to me. When you've gone the other way i.e Xbox 360 to PS3 you can see the main difference in how they do things.

As a Xbox 360 owner getting PS3 was a frustrating experience.


Same here. I just bought one and I've been completely baffled as to the way things work on the XMB. It doesn't make me glad to pay for XBL, but makes me wish shit actually worked the way it should on the PS3.
 

Revolver

Member
Shin Johnpv said:
Complete opposite here. Going from 360 - PS3 has me wondering why I bought a 360 before the PS3 in the first place. I'll take the PS3's XMB and PSN over the 360's interface and Live any day of the week.

Same here. At first I thought I wouldn't be able do without Live. Now, looking back, the only reason I had Live in the first place was because so many of my friends had it. Since a lot of them have migrated over to the PS3, I don't miss it at all. It brings back memories of when I had AOL because "all my friends have it too."
 
This thread is hilarious. I posted several times the acutal translation of the Japanese article and it was overall ignored (thanks a lot OP).

The article stated that Sony Online Services was not profitable YET due to start up costs incurred for online systems: video, PSN, Ebooks, Music (QRIOCITY Cloud Service). Each phase of the Online Service costs money to setup and keeps them in the RED since they are not done yet.

Further... Starting up a worldwide international media network is complex so Sony created an 11 year plan to profit (world domination).

** Yes the article actually states its an 11 year plan.

No where in the original Japanese article does it say PSN itself is unprofitable or talk about PSN versus XBOX whatsoever. Its an explanation that SPIN UP costs for Sony Online Services will keep them in the red as each phase of the business is built up which makes sense.

QRIOCITY for example is a HUGE undertaking. Larger than PSN gaming probably since it encompasses Music & Video both and that is NOT the PSN network infrastructure but a new setup.

Now is it possible PSN gaming is NOT profitable? (yeah right... Home makes ton of money with very little investment. PSN is profitable already deal with it.)

KAZ HIRAI did not make any statement about that in the article. He only explained that building a worldwide super media infrastructure for all media (games, music, video, ebooks) is so expensive their online initiative would not be profitable for several years.
 

bunbun777

Member
If Sony continues to allow for sharing, and actually can release retail games as a dd simultaneously, then they will make ba-ba-bank.

Physical retailers will have more reason to be upset but then again, they still have their second and third hand sales to cling to.

DD is so interesting because they can charge less and have the product expire like a rental, or charge full price, or even charge more with 'exclusive' packs or reserved future dlc included- shoot there is even the possibility of trading games with other users instead of just sharing them-
 
UntoldDreams said:
This thread is hilarious. I posted several times the acutal translation of the Japanese article and it was overall ignored (thanks a lot OP).

The article stated that Sony Online Services was not profitable YET due to start up costs incurred for online systems: video, PSN, Ebooks, Music (QRIOCITY Cloud Service). Each phase of the Online Service costs money to setup and keeps them in the RED since they are not done yet.

Further... Starting up a worldwide international media network is complex so Sony created an 11 year plan to profit (world domination).

** Yes the article actually states its an 11 year plan.

No where in the original Japanese article does it say PSN itself is unprofitable or talk about PSN versus XBOX whatsoever. Its an explanation that SPIN UP costs for Sony Online Services will keep them in the red as each phase of the business is built up which makes sense.

QRIOCITY for example is a HUGE undertaking. Larger than PSN gaming probably since it encompasses Music & Video both and that is NOT the PSN network infrastructure but a new setup.

Now is it possible PSN gaming is NOT profitable? (yeah right... Home makes ton of money with very little investment. PSN is profitable already deal with it.)

KAZ HIRAI did not make any statement about that in the article. He only explained that building a worldwide super media infrastructure for all media (games, music, video, ebooks) is so expensive their online initiative would not be profitable for several years.

Annihilation!

Nothing but dust remains.
 
UntoldDreams said:
This thread is hilarious. I posted several times the acutal translation of the Japanese article and it was overall ignored (thanks a lot OP).

The article stated that Sony Online Services was not profitable YET due to start up costs incurred for online systems: video, PSN, Ebooks, Music (QRIOCITY Cloud Service). Each phase of the Online Service costs money to setup and keeps them in the RED since they are not done yet.

Further... Starting up a worldwide international media network is complex so Sony created an 11 year plan to profit (world domination).

** Yes the article actually states its an 11 year plan.

No where in the original Japanese article does it say PSN itself is unprofitable or talk about PSN versus XBOX whatsoever. Its an explanation that SPIN UP costs for Sony Online Services will keep them in the red as each phase of the business is built up which makes sense.

QRIOCITY for example is a HUGE undertaking. Larger than PSN gaming probably since it encompasses Music & Video both and that is NOT the PSN network infrastructure but a new setup.

Now is it possible PSN gaming is NOT profitable? (yeah right... Home makes ton of money with very little investment. PSN is profitable already deal with it.)

KAZ HIRAI did not make any statement about that in the article. He only explained that building a worldwide super media infrastructure for all media (games, music, video, ebooks) is so expensive their online initiative would not be profitable for several years.

Thank you, saw the thread, I read the OP, thought something is wrong, then read your post.

It makes no sense that PSN (as in the stuff the PS3 is connected to and most people here are commenting about) would generate no profit yet.
Especially arguments over free online play are stupid, online gaming doesn't generate any relevant costs for Sony (aside from their own games with dedicated servers), just as it doesn't for MS. I guess you could argue that Sony could also enhance their profit margin with it, but they now choose to offer a content-based subscriptions instead of locking out basic functions of a gaming system. *shrugs*
 
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