Analysts: Sony could defray costs by stripping down PSN’s free services

[Sub-stance1]

Sounds like a good plan to me.

Analysts: Sony could defray costs by stripping down PSN’s free services, employ more “freemium” content

As Sony CEO Kazuo Hirai restructures the firm with a renewed focus on the PlayStation brand, and looks to “increase sales” via downloadable titles and subscription services through PlayStation Network, analysts believe consumers may soon see a vastly different PSN than what they’ve become accustomed to.

Spealing with GI International, Wedbush’s Michael Pachter said it was unlikely Sony would go the Xbox Live route with PSN by charging for it, but he does foresee the firm stripping down what is free and what is not.
“I think it’s unlikely that they will require a fee, but think they will strip down the free version to multiplayer and not much else in order to encourage people to pay the fee, said Pachter.
Billy Pidgeon of M2 Research agreed, citing the cost of providing networked services, explaining Sony could “defray those costs” while also benefiting from “the currently employed freemium model,” and charging for “enhanced, tiered and incremental items, services and add-ons.” He said that the firm should also look into partnering with more subscription services such as Microsoft did with HBO, ESPN and others.
“The PlayStation Plus program provides great incentives for subscribers, and Sony can get more revenue from advertising, item transactions and specialized services to enhance specific aspects of online gameplay such as custom content and rules for use for individuals, guilds and other groups,” he said. “Sony should also move quickly to shift paid content other than gaming to the network.”
However, Asif Khan, CEO of Panoptic Management Consultants feels Sony should go another route by not “making so many products,” as streamlining the product line “would lower costs” and help curtail the company’s “downright atrocious” profit margins.
Khan also said he feels SCEA would be “better off as a spun-off company,” but Sony would never allow it as SCEA has “some of the best margins and earnings growth in the entire organization.”
Hirai announced earlier this week Sony would be reducing its headcount across the corporation by 10,000 during fiscal year 2012, the restructuring process would end up costing the firm ¥75 billion yen.
Earlier this week, the firm also reported a ¥520 billion ($6.4 billion) annual loss for the financial year ending March 31, due to additional tax expenses from the US.
http://www.vg247.com/2012/04/14/anal...emium-content/

[Ghost-Rhayne]

This is what I suggested in another thread and is a great idea. The ability to play online with others should always be free, but all the additional stuff should be part of a sub service. Throw in and expand upon what was done with Vita's connectivity and other bells n whistles and it'll fly.

[Yungstar 2006]

they really need to move away from free on-line and include it as part of the + package to start making the bug bucks and will probably introduce it with ps4.

[MATRIX 2]

This is what I suggested in another thread and is a great idea. The ability to play online with others should always be free, but all the additional stuff should be part of a sub service. Throw in and expand upon what was done with Vita's connectivity and other bells n whistles and it'll fly.

Fragmentation of a userbase and inconsistent user experience is never a good thing.

[emmerich]

Fragmentation of a userbase and inconsistent user experience is never a good thing.

I have to agree, the sooner they charge for PSN the better, they can then use the income to improve PSN to be able to compete with XBL Gold.

[Sub-stance1]

I have to agree, the sooner they charge for PSN the better, they can then use the income to improve PSN to be able to compete with XBL Gold.

I agree too but at least this move may give them more revenue, but it still won't be enough to go against the constant improvements to xbox live. I say just charge for PSN. Gamers will bitch but they will pay.

[Ghost-Rhayne]

Fragmentation of a userbase and inconsistent user experience is never a good thing.

How would the userbase be any more fragmented than what it is now with PSN and PSN+? If people can play and use mic for free...No fragmentation, unless gamer a is mad that gamer b's games update automatically and he has cloud storage and store discounts.

[emmerich]

If everyone had to pay, they would. It would improve the service and no one would have anything to complain about (other than the fact they would now have to pay), but people will get over it and realise it can only be better for PSN. They should combine PS+ with the ability to play online and make it a single service. It only really makes sense.

Sony could then improve the service over time and it will only bring good things to PSN.

[Ghost-Rhayne]

Well I doubt it will happen, for the same reason Guild Wars 2 chose to remain sub-free; people associate PlayStation with free online gaming. Time will tell, but I'm pretty certain gaming online will remain free. If the bells and whistles are nice enough people will come on board. You shouldn't have to PAY to play games with each other, everything else...yeah you should have to.

[Soldier 95B]

I agree too but at least this move may give them more revenue, but it still won't be enough to go against the constant improvements to xbox live. I say just charge for PSN. Gamers will bitch but they will pay.

I am with you on this.

TapaTit

[AaronSOLDIER]

I'm not paying to play online when I already pay my ISP, period. If they charge online then I'm done with online play. I have no problems sticking to just single player games, its how I've been enjoying games for the past 16 years anyway.

But tbh all I want to do is be able to play online, have a friends list who I can communicate with via messages and use the Store. Don't care about anything else.

[TGO]

This is what I suggested in another thread and is a great idea. The ability to play online with others should always be free, but all the additional stuff should be part of a sub service. Throw in and expand upon what was done with Vita's connectivity and other bells n whistles and it'll fly.

Rule# 1
Never charge for something that was offered for free/or should be free
you start charging for the ability to download demo's or charge for the ability to buy off PSN( like DLC )
it'll cause nothing but a shit storm, you walk into a highstreet shop you don't get charged at the door for the right to browse.
And what about PS+, will that be a additional charge for extras?
that's already 40 pounds a year, so they can't replace it because they won't benefit from it, the only thing they can do is put a additional charge on top, which will piss everyone off, and I'd expect an episode of Watchdog come from it.
the only real option is to keep PSN how it is, kinda lacking & introduced a better service with more services & weekly content that PS+ subscribers automatically have access too as part of their subscription, with a cheaper subscription available for just the extra services & weekly content without the PS+ bonuses. for say 30 pounds or less

[MATRIX 2]

How would the userbase be any more fragmented than what it is now with PSN and PSN+? If people can play and use mic for free...No fragmentation, unless gamer a is mad that gamer b's games update automatically and he has cloud storage and store discounts.

If they were to just allow online play for free (and nothing else) that would totally mess up the online experience.

On the 360, every gold (and therefore online player) has access to the same resources (cross game chat, parties, messaging system, ect.) Therefore everyone is equal and the experience is fairly consistent for all online players.

With PSN you would have a bunch of online players that are not able to as effectively communicate with people that paid for those previously mentioned features. It makes the online experience inconsistent.

Online gameplay is just too lucrative to keep free. (consider that MS makes at least 1 billion dollars every year just off of gold subscriptions)

Sony need to find way to generate money for the next generation, charging for online gameplay is one of the quickest and easiest ways to do so.

And people will pay, because they will not have a choice. (I highly doubt console gamers are going to switch to PC gaming)

Charging for online gameplay isn't a bad thing, as long as the service is good. Or at least if the pricing is based on the quality of the service.

[radgamer420]

If they were to just allow online play for free (and nothing else) that would totally mess up the online experience. On the 360, every gold (and therefore online player) has access to the same resources (cross game chat, parties, messaging system, ect.) Therefore everyone is equal and the experience is fairly consistent for all online players. With PSN you would have a bunch of online players that are not able to as effectively communicate with people that paid for those previously mentioned features. It makes the online experience inconsistent. Online gameplay is just too lucrative to keep free. (consider that MS makes at least 1 billion dollars every year just off of gold subscriptions) Good points and very true. +rep Sony need to find way to generate money for the next generation, charging for online gameplay is one of the quickest and easiest ways to do so. And people will pay, because they will not have a choice. (I highly doubt console gamers are going to switch to PC gaming) Charging for online gameplay isn't a bad thing, as long as the service is good. Or at least if the pricing is based on the quality of the service.

+rep

[TEJ2025]

They should continue what they're doing now. Keep online free but start putting most (possibly all) new features on PS+ and people will start wanting to sub to it. Now if they do start charging for something that should be free I'll stop playing online. I can't waste money on something like that.

[rich15]

Sounds interesting, could be true.
Oh Patcher predicts it? *Throws in the trash*

[The Sith]

I have to agree, the sooner they charge for PSN the better, they can then use the income to improve PSN to be able to compete with XBL Gold.

The day Sony charges for online play you will see a massive exit of ps3 hardcore gamers that wants free online.
I envision Sony putting PSN into tvs Blu ray players and laptops so the service just wouldn't be limited to gamers. Sony can make more money thru tv buyers that want Vudu Netflix Hulu Cinema Now by offering PSN to the mass consumers thru PSN subscription service.

[mickice]

I have to agree, the sooner they charge for PSN the better, they can then use the income to improve PSN to be able to compete with XBL Gold.

Thats the thing tho, Vita can do the majority of what Gold can do for free.
I say keep the service free, I dont want to pay.

[Dennis Dyack]

The day Sony charges for online play you will see a massive exit of ps3 hardcore gamers that wants free online.

Where will they go? They obviously prefer console gaming over PC and they will have to pay for Live if they switch to the 360, so they will stay. They will bitch & moan & threaten to leave, but in the end they will pay. It works for MS and will work for Sony.

Sony will start charging to play online. It might not be this year or even this gen, but they will explain how much it costs to run a service like this and to stay competitive with Live they have to make this move.

[Sub-stance1]

Where will they go? They obviously prefer console gaming over PC and they will have to pay for Live if they switch to the 360, so they will stay. They will bitch & moan & threaten to leave, but in the end they will pay. It works for MS and will work for Sony.

Sony will start charging to play online. It might not be this year or even this gen, but they will explain how much it costs to run a service like this and to stay competitive with Live they have to make this move.

That what i say. If some paid for the PS3 at launch as expensive as it was they will pay for the service. They may not initially, but I see no reason why they wouldn't come around. I say if you buy a game at 60 dollars a pop, then a once a year fee shouldn't really be that much of a problem.

[mickice]

I still don't see why we should pay at all, even if you do pay servers still get shut down on older games. You're essentially paying for a connection fee. I already pay one of those to my isp.
I don't think SONY will add a online fee, just doesn't make sense too.

[Dennis Dyack]

I still don't see why we should pay at all, even if you do pay servers still get shut down on older games. You're essentially paying for a connection fee. I already pay one of those to my isp.

There is a lot more to it than MP game servers. They have to maintain servers for all of their content, movies, apps, music, etc. That costs big money and right now Sony is bleeding money. Plus, they could always turn older games into peer-to-peer gaming thus the games can be played on-line as long as there are others playing it. Most MS games are peer-to-peer now.

Having a service like this is expensive and with Sony not making the kind of profit they need on hardware & games, they need to recoup the money elsewhere.

[emmerich]

There is a lot more to it than MP game servers. They have to maintain servers for all of their content, movies, apps, music, etc. That costs big money and right now Sony is bleeding money. Plus, they could always turn older games into peer-to-peer gaming thus the games can be played on-line as long as there are others playing it. Most MS games are peer-to-peer now.

Having a service like this is expensive and with Sony not making the kind of profit they need on hardware & games, they need to recoup the money elsewhere.

This is exactly why I think they'd be mad to keep it free going in to the next generation. They won't be able to offer it for free if they intend to improve it because it just won't be affordable.

[Dennis Dyack]

This is exactly why I think they'd be mad to keep it free going in to the next generation. They won't be able to offer it for free if they intend to improve it because it just won't be affordable.

They do always have the option of not improving it, but that is a very bad idea.

[Sufi]

I won't bitch, I'll just go handheld