Microsoft and Sony Cloud Entertainment and Technology Collaboration [2019-05]

[iroboto]

Different culture for both companies. Not surprised.

Tommy McClain

MS was once like that for sure. They’ve certainly come a long way in a short period of time.

Which again, having to link back to a different but related topic. Ain’t no one leaking about this deal. This deal is like a partner solutions type deal. You can’t talk about it until after it’s released. We received no leaks and to the point that rank and file at Sony don’t know. This is like semi-custom departments at AMD. Isolated type deals walled off from employees.

But for next gen console specs, we’ve got them all leaks being contained by a pasta strainer.

And this is why no one should believe in leaks, lots of made up stuff. Because if leaks were common as they make it seem, then Brad Sams would have gotten the low down on this one too.

 

[AlNom]

I'm kind of surprised more devs don't just troll pastebin with fakeleaks. >_>

I mean, you really think someone would do that, just go on the internet and tell lies?

 

[Nesh]

In Major Blow To Sony’s Upcoming PlayStation 5, Microsoft Announces PlayStation 6

https://ogn.theonion.com/in-major-blow-to-sony-s-upcoming-playstation-5-microso-1834895267

 

[Shifty Geezer]

That's unfortunate, seems like MS teams were well informed of the deal.

I'm not seeing that. Xbox peeps could (and probably were) just as much in the dark, because this was a negotiation between Sony and the Azure lot. In fact, I'd expect the same on MS's side because you wouldn't tell the engineers working on the next console about negotiations happening elsewhere in the company.

Phil Spencer may have been informed, hence the tweet. But equally, it could have been that morning just before the announcement that he was informed. "WTF?!" he blurted, before being talked through what it was about, how it didn't impact Xbox plans, and then he formulated a response.

No-one should be trying to infer corporate cultures from this article! It doesn't mentioned MS's side at all, leaving people plain guessing as to what happened.

 

[iroboto]

I'm not seeing that. Xbox peeps could (and probably were) just as much in the dark, because this was a negotiation between Sony and the Azure lot. In fact, I'd expect the same on MS's side because you wouldn't tell the engineers working on the next console about negotiations happening elsewhere in the company.

Phil Spencer may have been informed, hence the tweet. But equally, it could have been that morning just before the announcement that he was informed. "WTF?!" he blurted, before being talked through what it was about, how it didn't impact Xbox plans, and then he formulated a response.

No-one should be trying to infer corporate cultures from this article! It doesn't mentioned MS's side at all, leaving people plain guessing as to what happened.

At the level Phil sits at, he would be privy to those discussions since he’s bonded by NDA and has stock blackout restrictions at all times with his job.
Often in those type of sealed environments, like say I am product manager for Navi. The semi custom team asks me if I can sell it for below 20% margin. I say no, too low can’t approve. They won’t tell me who the customer is or volumes because I’m not bound by stock blackout periods. So it moves up the chain to a VP or EVP yo approve the margin for the deal. (Otherwise I could be like, oh Sony is buying Navi? Time to load up stock)

So yea the Xbox team was likely in the dark
Probably right until the official announcement and they probably received corporate communications then and then a little later Phil’s tweet went out. The azure teams were up to date though. I guess it’s a bit of a non story, except no one cares about MS side since they are providing a service and Sony already has one.

 

[BRiT]

I mean, you really think someone would do that, just go on the internet and tell lies?

Twitter is full of it, but Trump is a topic for the RPSC forum.

 

[MrFox]

https://www.sony.net/SonyInfo/IR/library/presen/irday/pdf/2019/GNS_E.pdf

So they currently have an infrastructure large enough for 5 million on PSNow. They made a deal with Azure in order to "scale faster" and they expect an exponential growth of PSNow user base for PS5. They continue to invest to scale their own infrastructure. It's not a replacement at all, which is why they told employees the news have zero impact on next gen development. I.e. Ignore the BS from journalists.

Speculating, it looks like they need their own technology to work on other cloud services to multi-source the PSNow provisioning as a commodity. They need a site-wide congestion control compatible with their own, and some agressive QoS guarantees and reservations. This might require any cloud provider wanting such contract to implement sony's QoS algorithm into whatever SDN they are using, or provide a compatible equivalent. My wild guess is that Amazon refused and Azure accepted to modify their SDN switches/routers software. In exchange for what we see in the press release.

There was no mention of cash nor service contract nor stock in the press release. It would have been required by the SEC I believe? They exchanged tech to allow PSNow to scale using Azure, which xbox will take advantage of equally, hence the joint development.

 

[Deleted member 11852]

That's unfortunate, seems like MS teams were well informed of the deal.

This is very much Japanese culture at play where all key decisions happen behind closed doors. Remember that Sony's first party studios learned about PS4 having 8Gb GDDR5 when Sony said it publicly at the PS4 reveal and not before.

 

[iroboto]

This is very much Japanese culture at play where all key decisions happen behind closed doors. Remember that Sony's first party studios learned about PS4 having 8Gb GDDR5 when Sony said it publicly at the PS4 reveal and not before.

maybe, but like Shifty said, it may not even be. When something like this comes around, people can't know because of insider trading etc. Everyone has to find out at the same time, type of thing. The more I think about this story, it does seem to come across as a non story. Yea I think I can understand why they were shocked, but people don't find out they're going to lose their job until the day of sometimes .

I get their shock value, but perhaps I just read a hot take and forgot about the realities of B2B type stuff.

 

[Shortbread]

Cloud note...

That being said, Ryan clarified that “as of now there is no partnership between Sony and Microsoft” as they simply signed a memorandum of understanding committing them to explore potential partnerships.

After those exploratory talks, if an agreement is reached on high-level principles, only then the two parties will start looking at business models.

A potential partnership with Microsoft would provide the opportunity to move to something that’s “less capital intensive” than the current form of PlayStation Now. Yet, this has still to be studied.

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On another note.....

To a further question, Ryan mentioned that Sony is “broadly happy” with the ratio of 20% of the market taken by first-party games and 80% by third-party games. It allows the house of PlayStation to have “critical mass” and return of investment on its third-party studios.

On top of that, allowing third-parties to take an 80% market share positions PlayStation as the “publisher-friendly platform.” This has been an approach that Sony has taken since the very start. According to Ryan publishers “enjoy working with PlayStation” and thanks to the massive hardware installed base, there is plenty of opportunities to monetize for partners.

The 20-80% ratio has roughly been the same in past generations, and Sony considers it “about the correct one.”

Ryan also talked about the Chinese market, mentioning that it’s a very large one, and it’s clearly of interest to any gaming company. With that said, the censorship situation in China in the past year has been “very extreme.” Ryan has spent a considerable amount of his own time visiting China and formulating plans and grow the market there, but those plans had to be put on hold as no new games have been published there due to the approval suspension.

In the long-term, Sony “absolutely” sees China as an area of potential opportunity, but for now, they’re not aggressively investing in the country until the situation around censorship clarifies itself.

 

[MrFox]

I can't stop laughing at the way it was blown out of proportion in the media.

They are exploring the possibility of eventually elaborating a business model to possibly do something together to save money on streaming. They don't know what yet, because they haven't even started the exploration phase. They signed an intent of exploring things.

Okay.

 

[BRiT]

So they're saying there's a chance...

 

[Shortbread]

So they're saying there's a chance...

 

[Deleted member 11852]

maybe, but like Shifty said, it may not even be.

No, it is. I've worked in multi-national aerospace and defence companies and this is just how it works in Japan. Anybody with any experience knows this. It why why there is a significant divide between Western and Eastern cultures in pretty much everything.

 

[Silent_Buddha]

No, it is. I've worked in multi-national aerospace and defence companies and this is just how it works in Japan. Anybody with any experience knows this. It why why there is a significant divide between Western and Eastern cultures in pretty much everything.

Yes, that's due to the difference in how confrontations are handled.

In the West, there's often little to no stigmata in confrontations happening in the open. While not necessarily desirable, if it happens, it happens. Saying no to someone doesn't impact a person's standing or reputation.

In Japan, there's a history of preserving your reputation as well as other's reputation. You must always present a polite and non-confrontational façade in public. This often means that you can't say "no" in public which means asking someone to do something where they might say "no" is very much frowned upon. Hence, the various tiers of respect and the various ways one addresses those of a higher or lower station. Due to this, not only do deals happen behind closed doors (so there is no pressure to have to say "yes") but often deals are not negotiated by the ones in power...at least not face to face. They may make the decisions, but they won't enter negotiations usually until a deal is already in place and finalized. And this is just a tiny tip of the iceberg.

Hence it's not uncommon for a lot of deals to be made after hours at bars, night clubs, etc. where it's informal and things can be blamed on drinking too much. At the place I work at occasionally in Japan, ALL deals are made at bars and restaurants with lots of alcohol consumed.

It can get pretty complex and arcane to people outside of the culture.

Regards,
SB

 

[Deleted member 11852]

In the West, there's often little to no stigmata in confrontations happening in the open. While not necessarily desirable, if it happens, it happens. Saying no to someone doesn't impact a person's standing or reputation.

You can certainly say this for the United States, France and Italy but not for the United Kingdom, Germany, the Netherlands, Canada and many Nordic countries.

 

[AlNom]

I take it that means you’ve gotten into open confrontations at least once in each of those countries.

 

[MrFox]

That's unfortunate, seems like MS teams were well informed of the deal.

Considering there is no partnership, in retrospect:

- Microsoft culture: Inform employees of a deal which didn't happen, don't correct the misrepresetation in the media.

- Sony culture: Inform employees when something is actually happening. Correct the media's misrepresentation.

 

[Ike Turner]

Considering there is no partnership, in retrospect:

- Microsoft culture: Inform employees of a deal which didn't happen, don't correct the misrepresetation in the media.

- Sony culture: Inform employees when something is actually happening. Correct the media's misrepresentation.

There's literally nothing to "correct". Microsoft & Sony released one single joint press release:
https://news.microsoft.com/2019/05/16/sony-and-microsoft-to-explore-strategic-partnership/
Everything else is just mindless fairy-tales from folks making shit up (who apparently also don't have enough attention span to read the whole PR)

 

[MrFox]

There's literally nothing to "correct". Microsoft & Sony released one single joint press release:
https://news.microsoft.com/2019/05/16/sony-and-microsoft-to-explore-strategic-partnership/
Everything else is just mindless fairy-tales from folks making shit up (who apparently also don't have enough attention span to read the whole PR)

Have you looked at the internet? The gaming media is saying they signed a partnership. They didn't. I still don't get why the press release was necessary to announce nothing. Maybe it's some SEC requirement or something.