Mobile gaming revenue accounts for more than half of the mobile gaming market. Sony is looking to diversify beyond consoles with its new dedicated mobile gaming division, PlayStation.
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Sony created a dedicated PlayStation mobile gaming device in a big push to diversify beyond consoles.
The Japanese gaming giant launched the PlayStation Studios Mobile Division on Monday and said it will operate independently of the console business.
Sony also said Monday that it has acquired Helsinki- and Berlin-based mobile game developer Savage Game Studios.
The move comes after a tough second quarter for Sony’s gaming division and the company downgrading its full-year profit forecast for the business as the Covid-fueled boom – during which people stayed home playing video games – begins to fade.
Sony also continues to face supply chain issues and is unable to meet demand for its flagship PlayStation 5 console.
Sony has dominated the console market for several years thanks to the PlayStation. But now the company is looking to diversify. This year, the Japanese gaming giant said it plans to release about 50 percent of its PC and mobile games by 2025, up from about a quarter now.
“For this to happen, Sony needs to make big bets on mobile gaming,” Serkan Toto, CEO of Tokyo-based gaming industry consultancy Kantan Games, told CNBC.
And the possibility is great. Consoles account for about 27 percent of the $196.8 billion gaming market, while mobile devices make up more than half of the revenue, according to Newzoo.
Sony’s mobile strategy
The purchase of Savage Game Studios continues that of Sony recent acquisition drive as it looks to boost cross-platform title development.
“PlayStation Studios must continue to expand and diversify its offering beyond the console, bringing amazing new games to more people than ever before,” said Hermen Hulst, head of PlayStation studios. “Acquiring the talented team at Savage Game Studios is another strategic step toward that goal.”
Sony said Savage Game Studios is working on “an unannounced new AAA mobile live-action game.” Triple-A game is an informal industry classification, usually for a blockbuster title. A game with a live service is usually a title where the developers are constantly updating and adding content to extend its life and generate revenue over a longer period of time.
The success of Call of Duty Mobile and Diablo Immortal on mobile, which were originally intended for console and PC, show there is demand for well-known titles on smaller screens “if they execute well,” according to Daniel Ahmad, senior analyst in Nico Partners.
Sony’s mobile strategy will likely build on its massive intellectual property (IP) library, but also with a focus on developing specific games for smaller devices, Kantan Games’ Toto said.
“Sony is very likely to not only port existing PlayStation IPs to mobile devices, but also encourage studios to develop new franchises for smart devices from scratch,” Toto said.
Chances of success
Sony is the latest console maker to take a big step into mobile gaming. Microsoft’s Xbox gaming division has also started making early moves into mobile devices. Over the past three years, Nintendo has also focused a lot of effort on the smaller-screen gaming format.
Globally, Sony will be competing with companies it hasn’t really had before, notably Chinese giants Tencent and NetEase, two of the world’s biggest mobile game players.
But Toto said Sony’s chances of success are still strong.
“The mobile gaming market is overcrowded. Nowadays, there are over 1 million games in the app stores. But players like Sony, even if they are new entrants, they can still do it just because of their firepower,” Toto told CNBC.
“There aren’t many companies like Sony with such a strong brand, a whole host of high-performing studios and a treasure trove of valuable IP.”
https://www.cnbc.com/2022/08/30/sony-sets-up-a-playstation-mobile-gaming-unit-in-push-beyond-consoles.html
