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The reason why Sony succeeds has to do with strategy, both theirs and their competitors' strategies.  However if you break it down, things may not actually be as they first appear.  Let's start with the PS1 and see what lead to their successes:

PS1 Advantages
+The Sony Brand - Sony, for a long time, has been known as a maker of top quality electronics.
+The Most Capital - When they entered the market they had far more investment ability than Nintendo or Sega.
+Right Side of Technology - CDs at this time were much better than cartridges in both cost and storage capacity.
+Wooed Japanese Third Parties - The best example of this is the vast amount of money they spent advertising FF7.  Nintendo never supported a third party like this.
+Wooed PC Devs to Console (i.e. Western Devs) - Some of the biggest hits to appear on Playstation platforms were franchises that started on the PC, such as Tomb Raider or later Grand Theft Auto.  Sony wooed them over.
+Innovative Games - Going with the last point, the PC games were a huge source of new experiences for console gamers.
+Best Value - Sony adopted the razor and blades model which means they sold hardware at a loss.  This made their hardware a better value than either Sega or Nintendo could offer.

PS1 Disadvantages
-Inexperienced - Sony had no experience as a console maker. Nintendo and Sega had plenty.
-First Party Games - Nintendo and Sega had many years of game making experience over Sony.  Sony was totally outclassed here.

PS1 Synopsis: Sony's advantages clearly outweighed it's disadvantages.  They may have been outclassed in first party games, but PS1 had almost all of the third party games as exclusives.  Their hardware was also the best value.  These huge advantages translated into a landslide victory.



PS2 Synopsis: I'm not going to break it all down this time, because it's pretty similar to PS1.  However, this time Sony no longer has inexperience as a disadvantage.  They win by an even bigger margin.  Let's move on.

PS3 Advantages:
+Sony Brand - They were still viewed as making the highest quality electronics.
+Playstation Brand - Sony tends to follow a very consistent strategy and consequently Playstation was (and is) viewed as a very reliable brand.

PS3 Disadvantages:
-Outclassed in Capital - With Microsoft spending up a storm, Sony could no longer win purely based on resources.
-No Third Party Advantage - Microsoft had almost all of the third party games that Sony had.  The Wii also had a lot of third party games.
-Outclassed First Party - Nintendo dominated here.  Sony kind of tied Microsoft here.  Sony's first party library was stronger overall, but Microsoft released their big first party games sooner.
-Wrong Side of Technology - Microsoft had the best internet service.  Nintendo developed motion controls.  Sony focused on Blu-Ray which was the least important tech of this generation.
-Outclassed in Innovative Games - Nintendo amazed the world with it's motion control games.  Sony got into motion controls late and had the least impressive motion control offering.
-Slow Game Output - For the first half of the generation Sony had the worst game output of the big 3.  They eventually recovered from this, but by that time, the damage was done.
-Worst Value Hardware - They launched with a $500/$600 price tag and had very few games at first.  This made PS3, by far, the worst value of the 3 consoles.

PS3 Synopsis: Sony followed a strategy very similar to the one they always do, however during this era their competitors had learned how to counter it.  Nintendo went cheap which means Sony massively lost the value advantage.  Microsoft got almost all of the same third party games.  Sony also jacked up the price of their console and made investments into the wrong technology (for gaming), since Blu-Ray was not as important as either internet gaming or motion controls.  They lost a lot of market share this generation, but the more important thing was their financial sheet.  They had massive losses throughout the generation.  Financially, the PS3 was Sony's worst mistake.

PS4 Advantages
+Sony Brand - They still made high quality electronics.
+Playstation Brand - They still followed the same strategy, so they are still viewed as highly reliable.
+Third Party Advantage - Clearly PS4 was better than Wii U here.  However there were some Japanese third parties that skipped XB1 and ended up PS4 exclusives.  They didn't dominate here like the PS1 and PS2 days, but they still had the advantage.
+First Party Advantage - PS4 had a much stronger first party offering than XB1 this time.  The Wii U's first party offerings were fairly weak by Nintendo standards.  Also some PS3 games like the The Last of Us were not played by enough PS4 owners that these ended up as "new to me" games.
+Right Side of Technology - Ironically they didn't do much with technology which was the right move this time.  Microsoft and Nintendo invested in expensive controls which was a major misstep.
+Best Value Hardware - Customers didn't value Kinect or the Wii U gamepad.  That made the plain PS4 the best value.

PS4 Disadvantages
-Investment Capabilities - Microsoft has deep pockets and Nintendo had (and still has) a mountain of cash from the Wii/DS era.  Sony started the era with heavy losses from the PS3.  Sony couldn't win because of pure spending.
-Lack of Innovative Games - Microsoft and Nintendo tried to innovate more with games based on their controls, but the market didn't bite.  Not a huge disadvantage for Sony this time, but a potential weakness to watch in the future.

PS4 Synopsis: Sony benefitted greatly, because of Microsoft's and Nintendo's missteps.  Sony actually had most of the vulnerabilities that they had with the PS3.  They made a conservative launch with the PS4, while both Microsoft and Nintendo bundled expensive controllers with their systems that the market didn't want.  That made PS4 the best value.  Third parties favored them a bit over Microsoft (and Nintendo not at all) and all of this snowballed into victory for the PS4. 

Overall Synopsis: Sony entered the video game market with huge advantages during the PS1 and PS2 eras.  These advantages forced Sega out of the console market and captured a lot of marketshare from Nintendo.  However, all of this changed during the PS3 era.  Sony does not have the advantages that it originally did.  Sony had the best system value, the deepest pockets, and a mountain of third party exclusives during the PS1 and PS2 era.  Now Nintendo systems are usually the best value while Microsoft gets all (or almost all) of the third party titles that Sony does.  Most importantly, capital is now a disadvantage for Sony.  Microsoft has the deepest pockets and Nintendo has a (growing) mountain of cash.

Sony needs to be very careful going forward since it lost some of the core advantages it started with.  They need to make all the right moves while capitalizing on their opponent's missteps.  This is exactly what they did with the PS4.  However things could now, just as easily, swing against them.  If they come out arrogantly with the PS5 expecting an easy win, then they are going to be in for a rude awakening.

Last edited by The_Liquid_Laser - on 07 June 2020