Sony is holding the Investor Relations Day for the Electronics segments in Tokyo, and Sony Computer Entertainment President Andrew House outlined his plans for the future of the business:
House began by explaining that the PlayStation ecosystem is the core asset for the Game & Network Services Segment of Sony. The strategy for the mid term can be summarized with three words: “Bigger, Stronger and Better.”
Sony Computer Entertainment intends to be “bigger” with an increased user base of highly engaged users, to be “stronger” by strengthening the competitive appeal of Sony’s platforms, and “better” in terms of the diversity, the quality and the innovation of the offered services.
Sony believes that it has the advantage of a stable platform with a long life cycle, and the goal is to increase the value of that platform to the end user over the course of that life cycle. A good example of that is Share Play. According to Sony Share Play is a “revolutionary feature” and a “marvelous trial opportunity” that will drive sales both for first and third party games.
Project Morpheus is another example, enhancing the PS4 platform by offering a completely new way to play games. Those new features are coupled with a “relentless” effort to reduce cost and increase profitability.
Also important is broadening the user base by strenghtening the content portfolio.
House believes that much of the success of the PS4 is due to “laser targeting” the core gamers as a base to build the audience of the platform. The next step will be to take the same spirit and expand it to casual and family experiences, increasing the appeal of the platform to a much broader audiences.
Innovating in the services offered is also a priority, and an example is PlayStation Now, that allows to cater to a whole new audience by removing the barrier of entry of the purchase of the console.
Growing in new markets like China and Latin America and taking advantages of cultural shifts in more mature markets are also important opportunities crucial to Sony’s strategy.
Sony Computer Entertainment has adopted RPPU (Revenue per Paying User) as a metric to measure the success of the business, moving away from hardware versus software phyisical tie ratio and to look more holisticly at the business as a whole. Increasing said value is also a priority.
House concluded his presentation by promising that the growth targets for the next few years will be achieved by increasing sales and profit through the expansion of PlayStation users providing “compelling and cutting-edge” game and network experiences.