PS4 proves that Sony should cut 1st party production

[joker454]

Too many wild conjectures, made up numbers, and even strawmen gamers. The first parties aren't losing a billion per year every year (which is what would be needed to pay for a drop that is significant), that would be crazy. According to Yoshida the sum is profitable and it's his objective to stay like that (two or three hits paying for all the others) so that billion loss figure doesn't make sense.

I'm not saying they are incurring a huge loss, what I'm arguing is that is it worth still doing that, having a bunch of losers funded by a handful of winners even if that is currently slightly profitable. Is that worth it compared to the alternatives that can be done with that same sum of money, one of which I suggested is dropping the price of entry to get more people into the fold and hence spending more on Sony services. Another could be offering better bundles or pack in games. Or maybe spend that money buying exclusivity time windows on key games or exclusive dlc. There's lots of other options rather than just "exclusives".

I don't understand why you group together the gamers who praise them and the gamers who didn't buy them. Seeing first parties purely as direct money makers is incorrect as it's helping the platform as a whole, the platform itself is the most important reason to make those games. Each gamer will have his/her own rational reason to buy a console or a game. The less the sum of this group overlap in tastes, the more advantageous it is to have a genre variety. The third parties will NOT do that and will only make the same popular genres over and over (the games that defined the expression "hardcore gamer" on PC, or "PC master race", or whatever it's called today). The platform holders have a different goal and they profit from having variety regardless of each individual game's sales figure. It's not like the entire gaming community is some collective moving as a single mind. Each genre, heck even each individual game, will appeal to different demographics. The less the overlap, the higher the sum of console sales. Right now I tihnk Sony is meshing very across third party offerings.

There are many things that can help the platform as a whole, it doesn't have to be just about exclusives. There's other ways, possibly better ways to entice people to the platform. That's what I'm getting at. Given finite resources (cash) it seems to me they could be managing that better than they are right now.

So I think genre variety is the correct decision and it's the most profitable use of first parties for the platform. And about the risk, who knows which of the first party studios will become the next Naughty Dog, or the next That Game Company, or the next Media Molecule, etc... It gives the platform an identity, and it helps the prestige of the brand.

I think they would be better off identifying key companies early in their lifesspan and partnering with them for short term benefit, then moving onto the next. Aside from a key one or two companies, I don't think they need to be fueling all these studios themselves, I don't think that is a winning solution anymore.

 

[joker454]

You can't realistically expect 80 million PS3 owners to upgrade in the first year!

Ah of course not, I agree, because exclusives alone are simply not a storng enough pull. So why not maybe use that money on something else, something that would pull people in sooner rather than later? Wouldn't that be a wiser choice? They could have you spending on psn for the next two years, rather than get nothing from you for the next two years while you wait ofr that elusive "exclusive" that will finally get you to make the leap.

 

[Shifty Geezer]

Well in my anecdotal case, absolutely nothing other than exclusives can do it. Cheaper? Who cares, it hasn't got the games I want. Exclusive third parties? They'd only pick mainstream titles that won't appeal to me and will probably piss off a load of other gamers. Timed exclusives? I'll wait. Exclusive content? Big whoopin' deal! The games effectively the same save some marginal differences and/or an extra small level. Not worth buying a whole machine over. Games you can't play anywhere else that are just the sort of games you like? I'll bite! Note, 2nd party titles, as it were, count the same as first party and yes, it's possible to operate more like MS and buy in exclusive content. But as others have said, Sony's curating of its studios helps build them up. You can't just throw talent together and create a top studio.

As we've said repeatedly about these machines, it's all about the games. A box that has the games you want in the experience you want at the price you are willing to pay is the one you get. All things being equal, PS4 having the same games as XB1 and PC, reasons to buy it are diminished. I'll agree that for the FIFA and COD players of this world, the same box cheaper would help drive adoption. However, the loss of the exclusives that pick up one or two million buyers here and there would mean a smaller market in the long run.

If Sony's exclusives are the system sellers for 30% of their users, they can't afford to be without them. If they are the system sellers for only 5% and everyone else just plays 3rd parties, they could. We can only hazard a guess as to those numbers, but someone who does know with some accuracy is Yoshida, and he favours continued 1st party investment. And that's not a blind investment either. Sony purge out studios and projects to manage the portfolio to support the end game. It can't be handled any better than that (no matter how many Sony fans are saddened by favourite developer closures or terminated games).

 

[fbomber]

I bought my PS4 to play Uncharted, God of War, LBP and the next Last of Us.

The same for my Xbox One: the next Halo.

If Sony and MS didn´t have their exclusives, I would just game at my PC. Simple!

Here's the part that's interesting about your post to me:



We hear about the exclusives argument a lot on forums because the core gamers are a small but extremely vocal bunch. But in the end many are in the same position like you where they still don't even have a ps4 and it's unknown when they will (or if ever) actually buy one. Yeah they praise Sony exclusives and talk about their value, and yet they don't spend a dime on them or the platform at all. So for all the money that Sony has poured into exclusives, it's resulted in (anecdotal) results like yours where people will say yeah look at these cool Sony exclusives, they are awesome, they *may* make be buy a ps4 one day, maybe, perhaps. To Sony, where's the value in that?

To play the counter card, what if Sony instead decided to say to heck with exclusives, core gamers praise them to the moon on forums but they aren't getting them to actually buy the damn console and even when they do buy the console they seem to not buy our exclusives much anyways. Instead what if Sony took all that money and used it to subsidized the price of a ps4 by an additional $50 to $100, whatever those hundreds of millions would allow. Wouldn't that be a better move to get more consoles into the hands of *all* interested parties and in turn then get them spending more on psn, movies and other stuff on the platform rather than spending 50 million on an exclusive game (not including funding the studio when it's making nothing) only to have gamers praise them and then say "meh" when it comes to actually buying them? I ask people to ponder this not as a gamer, but if it was your company and your money being spent, what would you do?

 

[Sonic]

Well there we have it. There are individuals out there who purchase consoles based upon the exclusive content that appeals to them on those platforms. So 1st party games do indeed sell consoles.

joker454, could you give us alternatives to 1st party development that you truly think will be a better method of selling consoles?

I think a price cut would only temporarily produce a spike in sales but wouldn't be able to sustain higher sales for a greater period of time. While the console industry has changed a lot in the past decades some basics such as a need to have original, exclusive content still hold true. So having 1st parties providing that exclusive content only makes sense from a business standpoint. I do believe if Sony's finally able to make decent profits from the machine that it will do some of the things you mention such as timed exclusivity or exclusive DLC on games or maybe even buying outright exclusivity. These business tactics can still happen if Sony's making money and wants to further grow their market while still having 1st party development.

A price cut really only brings more demand to those willing to pay for a product at a specific price. I imagine if that product has exclusive content on top of a price cut I imagine there'd be more people willing to buy the product at the lower price.

 

[joker454]

Well there we have it. There are individuals out there who purchase consoles based upon the exclusive content that appeals to them on those platforms. So 1st party games do indeed sell consoles.

joker454, could you give us alternatives to 1st party development that you truly think will be a better method of selling consoles?

I think a price cut would only temporarily produce a spike in sales but wouldn't be able to sustain higher sales for a greater period of time. While the console industry has changed a lot in the past decades some basics such as a need to have original, exclusive content still hold true. So having 1st parties providing that exclusive content only makes sense from a business standpoint. I do believe if Sony's finally able to make decent profits from the machine that it will do some of the things you mention such as timed exclusivity or exclusive DLC on games or maybe even buying outright exclusivity. These business tactics can still happen if Sony's making money and wants to further grow their market while still having 1st party development.

A price cut really only brings more demand to those willing to pay for a product at a specific price. I imagine if that product has exclusive content on top of a price cut I imagine there'd be more people willing to buy the product at the lower price.

Last gen Sony had their entire armada of well known exclusive developers at their side, all untold millions of dollars of them whereas the competition had close to none. Yet that had no effect at stemming the tide of gamers defecting to the competing console. That tells me all those studios being funded didn't have the effect they intended and were not a good use of resources. If it weren't for the competitions console self destructing who knows what the damage would have been. Instead what seemed to matter more than any exclusive ever could was price point along with worse showing of the games people play the most, namely multi platform games. That's just one example of where exclusives alone, while lauded and placed on a pedestal on forums, don't necessarily reflect in real world console sales. If exclusives were the be all end all to all purchasers of consoles then last gen Sony should have won by a landslide.

Also I can't really comment on people going to pc's for their gaming because on forums there are always mixed signals sent out regarding that. Any time one mentions how just about every game looks, runs and plays better on pc and is cheaper to boot we get quickly reminded that nobody has a gaming pc because they are still using their 386sx based laptop. But then when it comes to some game not available for play on their console then suddenly everyone has a strong quad core full fledged gaming pc. So I have no clue what to make of peoples claims that they would simply "switch to pc gaming", because clearly for many that isn't true given how many millions of multi platform games are still sold on consoles even though the look worse and cost more.

Having said all that I'm not advocating the obliteration of every studio. But when talking about Sony exclusives, to me it seems like 50+% of that chatter goes to whatever Naughty Dog is working on, so they would obviously be a keeper more so because they provide a tech back end for all to use. Going down the chain it gets more complicated, but most of the time it tends to be games like GT or Killzone. I have no idea if Killzone is even profitable but somehow I doubt it. GT should be so they could be another keeper. Beyond that who knows, it's all about the numbers.

Regarding ideas what I would do is possibly court promising indie developers and strike temporary deals for a single game exclusive, nothing more. Keep it simple, partner with a promising indie shop and offer to help finance a game that will appear exclusively on the Sony platform. Beyond that nothing more. Net result could be like a Mass Effect type situation where yeah eventually the game ends up on all platforms, but they would get the first game from that studio exclusively with minimal financial risk. No worries about funding these large studios while they decide what to do next or wonder if the sequel will even be popular but at the same time you get some exclusive content relatively cheap in comparison to how they do it now.

Beyond that and the other ideas I mentioned I couldn't say, I'm not in their marketing or sales departments so I can't tell you exactly what they should do, that's up to them to sort out. But we all saw first hand last gen how having every exclusive in the world didn't help, sometimes there are other factors at play.

 

[Sonic]

I guess I have a different perspective on what Sony's 1st parties did for the PS3. They were one of the primary factors in salvaging the console and end up tying the 360 worldwide. Sure the 1st parties couldn't propel the console to #1 on their own and I don't think anybody is suggesting that, but without them I doubt PS3 would have sold nearly as many units as it has. Whereas if you look purely at the raw numbers I guess getting rid of unprofitable teams would save money on their bottom line, but would it be a positive or negative over the lifespan of the console? Would dropping these teams cause less overall sales of the machine? Do the long term savings outweigh the long term benefits of having a plethora of 1st party exclusives released over the lifespan of the console?

 

[joker454]

I guess I have a different perspective on what Sony's 1st parties did for the PS3. They were one of the primary factors in salvaging the console and end up tying the 360 worldwide. Sure the 1st parties couldn't propel the console to #1 on their own and I don't think anybody is suggesting that, but without them I doubt PS3 would have sold nearly as many units as it has. Whereas if you look purely at the raw numbers I guess getting rid of unprofitable teams would save money on their bottom line, but would it be a positive or negative over the lifespan of the console? Would dropping these teams cause less overall sales of the machine? Do the long term savings outweigh the long term benefits of having a plethora of 1st party exclusives released over the lifespan of the console?

Personally last gen I do not think it was exclusives that salvaged the ps3, it was that quite literally all 360's broke. Normally that would completely "Ford Pinto" a product but somehow the 360 was able to survive it but not before losing a mass amount of people to the non self detonating competing product. But that's ancient history now anyways.

Going back to the games let me grab one example, how about Killzone? Ok before anyone says anything think about that other exclusive Sony shooter Resistance. That game was heavily talked about on forums and was a prized exclusive. Yet now it's gone and has the Playstation empire crumbled as a result? Have Playstation sales plummeted to nothingness? Or perhaps worded more harshly, has anyone even noticed? So going back to Killzone, if that game went away would Playstation really be irreparably damaged by it? I'm not trying to knock these games as far as quality or whatever, I'm saying purely from a business perspective, does it *really* matter? If we are to believe the forums, the loss of any exclusive would be fatal to the brand. I'd agree that they clearly have soem high value exclusives that should be preserved, but outside of those I dunno, I'm personally not convinced that so many are really needed but your mileage may vary as they say. Anyways that's my 2 cents, not much more for me to add.

 

[Shortbread]

Personally last gen I do not think it was exclusives that salvaged the ps3, it was that quite literally all 360's broke. Normally that would completely "Ford Pinto" a product but somehow the 360 was able to survive it but not before losing a mass amount of people to the non self detonating competing product. But that's ancient history now anyways.

Seriously you believe that?

One of the saving graces for the PS3 was that it was a relatively cheaper alternative on owning a Blu-Ray player, compared to more expensive models. During the early lifecycle of PS3, many consumers strictly purchased the PS3 for those needs… not picking up one game. It was not until later on, that PS3 was seen as capable gaming machine... mostly because of its internal parties.

Going back to the games let me grab one example, how about Killzone? Ok before anyone says anything think about that other exclusive Sony shooter Resistance. That game was heavily talked about on forums and was a prized exclusive. Yet now it's gone and has the Playstation empire crumbled as a result? Have Playstation sales plummeted to nothingness? Or perhaps worded more harshly, has anyone even noticed? So going back to Killzone, if that game went away would Playstation really be irreparably damaged by it? I'm not trying to knock these games as far as quality or whatever, I'm saying purely from a business perspective, does it *really* matter? If we are to believe the forums, the loss of any exclusive would be fatal to the brand. I'd agree that they clearly have soem high value exclusives that should be preserved, but outside of those I dunno, I'm personally not convinced that so many are really needed but your mileage may vary as they say. Anyways that's my 2 cents, not much more for me to add.

If Halo or Gears disappears does it matter? No.

What Killzone, Halo, Gears, God of War, GT, or any other popular internal title does offer... is that initial console brand recognition and getting the loyalist on purchasing their particular brand "AGAIN". These titles for the most part are flagship titles - on driving hardware and software sales.

 

[tuna]

Going back to the games let me grab one example, how about Killzone? Ok before anyone says anything think about that other exclusive Sony shooter Resistance.

I think Resistance got (compared to how other games in the genre progressed) crappier and crappier. R2 had the 8 player co-op which was fun, but R3 was a massive letdown. Also, it wasn't first party, it was made by Insomniac who I hope my views on are well known.

 

[joker454]

Seriously you believe that?

Yup I do. Incidentally that is what started that first wave of things being shifted to more ps3 centric development. We were all 360 dev shops for some time but once word got around that 360's were all breaking (something we all knew internally before the public did since 100% of our dev kits broke) that's when we ordered more ps3 dev kits and begun to shift more to that platform, as it was expected that it's then slump was going to end very quickly as a result of the 360 hardware failures. Some of us weren't even sure the 360 was going to survive the whole rrod thing, but somehow they did.

What Killzone, Halo, Gears, God of War, GT, or any other popular internal title does offer... is that initial console brand recognition and getting the loyalist on purchasing their particular brand "AGAIN". These titles for the most part are flagship titles - on driving hardware and software sales.

And yet we saw loyalists in droves abandon the Playstation platform when they went from PS2 to this relative newcomer with few exclusives called the 360, and how we now see many Xbox loyalists leaving that platform to go to Playstation. Somehow in spite of all those famous and expensive exclusives each platform offers, it doesn't seem to have been enough in retaining fickle gamers to their respective platforms.

 

[Cjail]

@DSoup

I mentioned Activison, simply because they do shut down developers when they fail to deliver and Sony could indeed do the same.

Now as you pointed even when a first party title is not profitable in itself it can still be
useful to attract customers to PS3/PS4 or fuel PS+, or even persuade a new dev to develop for on PS3/PS4 so I do think that as log as Sony's first party devs will prove to be useful in some way they will not be closed.

 

[temesgen]

Last gen Sony had their entire armada of well known exclusive developers at their side, all untold millions of dollars of them whereas the competition had close to none. Yet that had no effect at stemming the tide of gamers defecting to the competing console. That tells me all those studios being funded didn't have the effect they intended and were not a good use of resources. If it weren't for the competitions console self destructing who knows what the damage would have been. Instead what seemed to matter more than any exclusive ever could was price point along with worse showing of the games people play the most, namely multi platform games. That's just one example of where exclusives alone, while lauded and placed on a pedestal on forums, don't necessarily reflect in real world console sales. If exclusives were the be all end all to all purchasers of consoles then last gen Sony should have won by a landslide.

Also I can't really comment on people going to pc's for their gaming because on forums there are always mixed signals sent out regarding that. Any time one mentions how just about every game looks, runs and plays better on pc and is cheaper to boot we get quickly reminded that nobody has a gaming pc because they are still using their 386sx based laptop. But then when it comes to some game not available for play on their console then suddenly everyone has a strong quad core full fledged gaming pc. So I have no clue what to make of peoples claims that they would simply "switch to pc gaming", because clearly for many that isn't true given how many millions of multi platform games are still sold on consoles even though the look worse and cost more.

Having said all that I'm not advocating the obliteration of every studio. But when talking about Sony exclusives, to me it seems like 50+% of that chatter goes to whatever Naughty Dog is working on, so they would obviously be a keeper more so because they provide a tech back end for all to use. Going down the chain it gets more complicated, but most of the time it tends to be games like GT or Killzone. I have no idea if Killzone is even profitable but somehow I doubt it. GT should be so they could be another keeper. Beyond that who knows, it's all about the numbers.

Regarding ideas what I would do is possibly court promising indie developers and strike temporary deals for a single game exclusive, nothing more. Keep it simple, partner with a promising indie shop and offer to help finance a game that will appear exclusively on the Sony platform. Beyond that nothing more. Net result could be like a Mass Effect type situation where yeah eventually the game ends up on all platforms, but they would get the first game from that studio exclusively with minimal financial risk. No worries about funding these large studios while they decide what to do next or wonder if the sequel will even be popular but at the same time you get some exclusive content relatively cheap in comparison to how they do it now.

Beyond that and the other ideas I mentioned I couldn't say, I'm not in their marketing or sales departments so I can't tell you exactly what they should do, that's up to them to sort out. But we all saw first hand last gen how having every exclusive in the world didn't help, sometimes there are other factors at play.

This is just wrong, the 360 launched a year earlier at a cheaper price. I'd argue that Sony's first parties helped get them back in the game bc early in the generation 3rd parties largely performed better on 360, the hardware was cheaper and most of the press was very much reinforcing the notion that the 360 was the better system to own. It wasn't until Sony first party titles started to come out and expand the offerings, price cuts and better performing third party titles arrived that the momentum shifted.

There are several factors which together led to the success of the 360 and relative (generation over generation) poor performance of PS3. Keep in mind that PS3 sold essentially the same install base as 360 coming out a year late and had a slow couple of years which made things very tough in the beginning.

And while we're at it, its often brought up that Sony 'lost' millions of gamers to XBOX last gen and while from a generation to generation numbers perspective it is true that MS did increase its market share, its also true that gamers have never been loyal to one brand or another. Sony made that mistake with their planning around the PS3 and MS may have made that mistake early on with XB1. From my point of view MS hasn't lost consumers in the traditional sense that people think of brands that consumers stick with over time. Gamers are a fickle bunch and will largely be in play every new generation. Even Nintendo seems to be reverting to the norm now...

 

[Shortbread]

Yup I do. Incidentally that is what started that first wave of things being shifted to more ps3 centric development. We were all 360 dev shops for some time but once word got around that 360's were all breaking (something we all knew internally before the public did since 100% of our dev kits broke) that's when we ordered more ps3 dev kits and begun to shift more to that platform, as it was expected that it's then slump was going to end very quickly as a result of the 360 hardware failures. Some of us weren't even sure the 360 was going to survive the whole rrod thing, but somehow they did.

This still doesn't make no sense. Sure I can understand why you guys moved forward on using more PS3 development kits, you had problems dealing with failing XB360s kits - but that doesn't fit with what retailers were going through. Most, if not all the XB360 that did failed, XB360 users either waited for the repairs or (re)purchased the XB360 again. I should know this, I was the General Store Manager for the now defunct CompUSA in Troy, MI. And most the managers that I knew back then, between GameStop, Best Buy, Walmart, etc... would tell you, XB360 owners replaced their systems - not a PS3. Oddly enough, we had some XB360 users replacing their systems up to 2-3 times within a years period. Which makes you wonder how many XB360 would have really sold, if the XB360 failure rate was really low.

And yet we saw loyalists in droves abandon the Playstation platform when they went from PS2 to this relative newcomer with few exclusives called the 360, and how we now see many Xbox loyalists leaving that platform to go to Playstation. Somehow in spite of all those famous and expensive exclusives each platform offers, it doesn't seem to have been enough in retaining fickle gamers to their respective platforms.

Because the XB360 was released a year earlier, so no competition. Plus, most XB360 early adopters were PC users who wanted a more traditional style of unified play, but still wanted to feel at home in a PC quasi ecosystem which XB360 offered. And the PS2 users who did followed, were more than tired of PS2 graphics... 8-9 yrs of redundant looking IQ, low textures, etc... would drive any gamer to upgrade - I know I did. But once PS3 became available, I returned exclusively for Sony's internal wares.

 

[szymku]

I owned PS1, PS2 only for exclusives. Seriously, a haven't bought single third party title on those systems - only exclusives. On PS3 the only multiplatform titles I got was Dark Souls series, and thats because console version was superior to PC. If not for system exclusives I would play only on PC.

Also I think that's first party saved Sony console last generation. If not for them they would be annihilated by competition.

 

[Xbat]

I feel first party exclusives are critical, in fact I feel software is becoming more important all the time. I meen a person can own a pc 5 times more powerfull than any console but without the software what are you really getting? higher resolution, better framerate.
My point being that the big differentiator is going to be software and thats just going to become more important the more powerfull hardware gets.

So having a big and expeirenced first party means you have more chance of creating that next big thing.

 

[Nesh]

I owned PS1, PS2 only for exclusives. Seriously, a haven't bought single third party title on those systems - only exclusives. On PS3 the only multiplatform titles I got was Dark Souls series, and thats because console version was superior to PC. If not for system exclusives I would play only on PC.

Also I think that's first party saved Sony console last generation. If not for them they would be annihilated by competition.

You reminded me that almost all of my games on PS2 and PS1 where also exclusives, and a significant portion also on my PS3 too

 

[Prophecy2k]

I clicked the poll and cringed as I braced myself to see the results. Good to see that logic and rationality reigns on this forum.

I also see that Joker has resorted to his normal set of faux-logical contrivances and revisionist theories of history, to explain away the reasons why the PS3 sold the way it did, and the supposed non-importance of exclusives. *shrug*

In my view, first party games development are more important than ever, if even for the purposes of padding out the console library.

This gen is not like the last. Development budgets are even higher, less titles are being greenlit and are in development, and we even started this gen with far less developers and publishers even alive than there was at the beginning of last gen.

First party studio now need to carry the burden of demonstrating the business case for developing profitably on their own platforms. In a world where pubs are increasingly turning to mobile platforms for the promises of substantially greater ROI, platform holders NEED to put out games on their platform; both to salvage the ever-dwindling supply of games for gamers, and also to show publishers that games can and will sell and be profitable on these AAA-budget-blockbuster-driven boxes.

It's more important now than ever before.

 

[Shifty Geezer]

I clicked the poll and cringed as I braced myself to see the results.

When I added the poll, I did think it was a no-brainer question.

 

[joker454]

I also see that Joker has resorted to his normal set of faux-logical contrivances and revisionist theories of history, to explain away the reasons why the PS3 sold the way it did, and the supposed non-importance of exclusives. *shrug*

Yup must be all revisionist history and faux logic, I guess I imagined the whole thing and we were all on crack at the time.