Sony invests $250m in Epic Games to acquire a minority stake

[mjk45]

padib said:

mjk45 said:

I feel that to the focus on UE is narrowing our thinking , it's been pointed out that Sony mainly uses in house game engines with great success on both a technical and sales level, so the main reasons a lot of studios use UE because of its familiarity in the industry and modularity doesn't apply and if they decide to use it they can just licence it like Sony Bend, so the more likely scenario is what has been stated, that is after working with Epic over a number of years on the PS5 SSD/IO and the positives that then flowed from that work with the UE5 showcase impressed Sony enough to take a small stake in Epic .

Now looking at the amount spent and combining that with both parties history with PS5's development , my conclusion is Sony was chuffed with the results of the partnership and its effect on the PS5's development so Sony looking ahead at future developments saw taking a small stake in Epic as a way of further cementing that relationship rather than it being a big financial strategy, being more of a symbolic gesture of were behind you going forward and so fencing off what they see as an asset in regards to future development, so it seems like it is a more general outlook than just UE/fortnite. 

It seems very unlikely that they spent 250 million dollars just to cement an R&D relationship. In stake, acquisitions and mergers, companies generally spend that kind of money to gain a positional advantage against their competition.

Here, there is so much more at play than R&D. We have:

• the importance of UE in the creation of 3rd party games
• the position Epic is trying to gain on the digital software space against Steam and now Microsoft
• the narrative position Sony wants against MS in the mids of gamers (we just saw this in the PR around the PS5)

Sony would never just put in that kind of money just to improve their R&D workflow. It's a small part of it, but there are much greater factors at stake imho.

 I feel we are in agreement,There are other benefits that's why I said it's a more general outlook than just UE /fortnite, but the likely catalyst seems to be the PS5 development and positive PR the two parts go together and cover the narrative position that you mentioned, plus the 250 million isn't really an impost since unless the bottom falls out of Epic's share price they should do all right.