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?
“Sony’s not in a position to halt all domestic production but it has to do something that drastic,” said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management. “If it announces plans to move production overseas while keeping only planning and development functions in Japan, that would be a positive.” (gamestooge)
The yen is losing value in our global economy making it more difficult to export the product and build any type of profitability plan. “A source said this month the company will likely suffer an annual operating loss of about $1.1 billion, its first such loss in 14 years” (news.yahoo.com) All this noise is making CEO Howard Stringer contemplate Sony’s involvement as a “software only” company, making us recall the changes at SEGA to this same result.
The Financial Times reported Sony will unveil details of its restructuring steps on Wednesday or Thursday. It said Chief Executive Howard Stringer was meeting with resistance from some executives to shifting the company’s focus to software from hardware and cutting jobs in Japan. (news.yahoo.com)
Is this just a case of a fearful executive 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?
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. In addition, Sony has already invested a large amount of cash into seeing PS3 through it’s 10-year plan and letting that die now is realizing a huge loss on investment.
If Sony pushes through the economic and maintenance course, the PS3 will become highly profitable, much like the PS2 last generation (with a slower ramp up for sales). Even if they break even after ten years it seems a lot better than throwing all the effort away.
Perhaps Howard Stringer is talking “software” for the next generation home console? You think Sony will create a PlayStation 4?
Hi guys.
Thanks again for this nice episode. Sorry that I was a little bit lazy writing comments under the last episodes, but I had to much thing going on :/
Regarding the topic of this thousand crappy small games on steam: I totally agree. There is so many useless shit there, it’s hard to find the good ones (and I bet there are many we will never find). On the other side, I don’t like that every company tries to run their own shop, because so you have to search / look through so many platforms that it feels like work :/
Best games of the year: i did not really played many actual games, because most of the time I played Magic The Gathering Arena and Hearthstone. Some Overwatch and Battlefield 5 the last weeks. BF makes fun because I play it with my friends, I would not have bought it to play it on my own 🙂
I bought some games, but did not find the way play it. These were Mega Man 11, Detroit become Human, Toki (the new Switch Version) and some shmups for the PS4. I think the only actual title I played so far is Life is Strange 2 (episode 1). Hollow Knight was released 2017, but I bought it some months ago. I love those metroidvania games and I am playing hollow knight a lot during the last weeks 🙂 I Stimm want to play God of War and Red Dead Redemption 2, but there are so many games I wanna play, I will wait with these two until they get a little bit cheaper 🙂
I hope all of you had a great New Year’s Eve and celebrated it with your friends and family. I am looking forward to a good 2019 with a lot of good games and many episodes of your podcast. Stay healthy and the way you are.
Greetings from your loyal listener,
Ralf