Takeda says "Our greatest risk now is losing our intensity". He is saying if PS4 sales start to slow, profits will most likely become less because simply jacking up the price of PSN isn't going to cut it, and can't last. There's lot's of other content they can sell like exclusive PS games, but those ever increasing console sales numbers are strong indicators of how the platform is doing overall.

With Switch potentially taking attention away from PS4, it makes it harder for PS to make money. Far from impossible, but harder. It also makes shareholders wonder how long PS4 can be 'milked' if it's user base growth is slowing. Sure PS5 is coming, but that's another gen and potentially a fresh start. We saw what that did to PS3, Wii U, and XB1. We also saw what it did for PS4 and Switch. It's anybody's best guess at this point in time.

While trying to sign more PS4 owners up to PSN, or get them to buy more games, exclusive games, etc, PS will surely want to keep consoles moving as much as possible. Not only does it allow for easier game and PSN sales, but the more people locked into the PS4 community, the less that will be tempted by Switch. The reason the PS2 was so successful, was due to it's early stranglehold of the market share, as well as overall unit sales.

Shareholders don't always care most about profit. There are many times where companies will announce record profits and even see their stock prices fall. Why? If the company is making money by milking a product, and doesn't have a bright, clear outlook for the future, it scares people off. Just look at AMD, the makers of the PS4 APU. Their stock increased an insane amount over a years time, all because Ryzen was on it's way. Meanwhile, AMD was still losing money during that entire year. The shareholders cared about the future, Ryzen, and the potential it would bring. Now Ryzen is on the market, AMD is making money, yet the stock price has basically flat lined. If PS4 sales slowed and Switch sales continued to increase, traders would sell their SNY stock and buy Nin stock.

With PS4 being as strong as it is, $199 was unnecessary, even against a $189 XB1S. I would almost bet the reason that PS4 was $199 for BF, was to give PS a good idea of what price range the PS4 needs to be at to make sure they aren't losing too many sales to Switch come next year. They know how PS4 sells at $299, and they now know how it sells at $199, so they can decide on what price is necessary to keep sales and momentum strong for the first six months of next year. They don't want to throw away money, but they also don't want to lose potential customers.

Before we go on - AMD shares are lower now than at the beginning of the year so not a great example. Now you said a lot of things so let’s keep it simple:

What do you deduce from the strategy he mentions when he said they have to keep the tension in several businesses? Recap, this is what he said:

we're working to get more customers paying continuously for content, for example through paid subscription services.

AMD shares dropped recently yes, but they have been up and down a few dollars for quite a while. Overall, they've basically flat lined.

"More customers" "continuously paying" "subscriptions". You can take that as either convincing existing, non PSPLUS, PS4 customers to pay, or acquiring new PSPLUS customers through new PS4 hardware sales.

Yeah Sony the Switch is sure successful because it lets people keep paying for stuff trough a subscription?

The Switch is successful because its a dedicated handheld

Yes and through newer services like PS Vue, PS Music, PS Video. A decrease in hardware sales in the later years mean nothing as there is a limit to how many units a console can sell. It’s all about how you engage your customers. You’re focusing on hardware when the PS4 has made Sony more money than the PS2 ever had at a fraction of the number of consoles sold.

PS4 does offer more services than PS2 ever did, and charges for them, but the article is mostly about the stock price and where it's potentially headed. A decrease in PS4 sales later on does mean something. Whether it means new customers are buying another console brand instead, or the PS4 is seen as old and out of date, it has importance. Especially in terms of when shareholders can expect next gen hardware to hopefully continue the PS4's momentum.

There is a limit to overall unit sales, but that limit is much higher than 100 million, even 200 million sales. PS4 could probably sell 500 million, if they could find a way to convince many more people to sit on the couch and game, instead of doing something else with their time and money. Convincing those non gamers is very tough. Convincing an existing gamer, who isn't into online gaming, or anything requiring a sub, is easier, but still tough. Convincing a brand new user, is much much easier period.

Let me put it this way. If your a dog lover, and you want to be able to teach a dog tricks, what's the more logical option? Go to the pound/shelter and buy an old beat up dog, or find a new litter and buy a young pup? If you have someone who has owned a PS4 for 3 years now let's say, and they still haven't bought into PS PLUS or any other service, are you as a PS businessman, going to try to convince them to buy into one, or are you going to push more console sales knowing there is plenty of room to grow and for every 2 or 3 new customers who buy a PS4, you are guaranteed one or two subs as well? There is a reason they say you can't teach an old dog new tricks. Now everyone knows that's false, that old dog can learn, it's just a huge pain in the butt to accomplish that goal. A new young pup however, once it's slightly matured, will do what you want for the most part quite easily.

As for keeping PS4 users on board, if you own a PS4 now, and switch to Switch, odds are that you fit the Nin/Switch ecosystem better. You may also just want variety and will play on both platforms. PS4 can offer as much as they want, like PSVR for a more than reasonable reduced price recently, but the true way to really hold onto these gamers, is to offer them something as similar as possible to Switch. This is why it is important for PS to pay attention to how the market is reacting to Switch, and decide what the best future approach is. Maybe it's a PS Switch, maybe it's more affordable VR, maybe it's a super cheap PS4. Highly affordable PS4 and PSVR, are much easier than making a PS Switch. All are possible if deemed necessary though.

Sony forecast a decrease in PS4 sold since the beginning of this fiscal year - how did that translate in share price? Let me help you - the share price still went up. I mean come on - the idea that Sony's share price depends on the number of PS4s sold and not the profit of the gaming division is kinda silly.

And no, I don't think it's easier to get an existing owner to spend an additional $10 a month vs. a new user spending $300 to get a new console. And your dog analogy is just as silly. Again, with the PS+ example, it's much easier to make PS+ more attractive to users than get people to buy a new system. Look at PS Vue - 670k subscribers in the US paying at least $30-$75 a month (growth of 570k in 1.5 years). That's the equivalent of 67,500 to 167,000 new PS4s each month. Do you really think it's easier to grow PS4 sales by that much each month in the US? I don't think so.

So they announced it around March then. How ironic that SNY stock dropped from late March to mid April, due to that poor sales forecast, but then rose from there, more than likely because the sales numbers themselves showed promise otherwise. The more consoles they sell, the more profit they make. It's not like they can't make profit without more console sales, but it's much easier that way and it's also easier for investors to have an idea of where the profits will land and the share price is headed. Console sales are something they can constantly watch, where as much of the other information they require is locked behind quarterly investor meetings. SNY also did a smart thing, having the sales numbers add hype instead of being a letdown, which would help the stock price to rise.

How did PS get those subs in the first place? By selling PS4's. How many of those new Vue purchasers are existing PS4 owners vs new PS4 owners? How much did PS have to give up to get those new subs vs what they had to give up to sell more consoles? Just because you find the analogy silly, doesn't mean it's not true.

You also said "And no, I don't think it's easier to get an existing owner to spend an additional $10 a month, vs. a new user spending $300 to get a new console."  So you agree with me then? Focusing on hardware is a much easier way to increase console sales, as well as subs, since the numbers show for every so many new PS4 owners a certain amount of subs come along with those purchases. If you have little competition, putting more focus on sub sales actually makes sense. If you have competition, like Switch, when it's this early in it's lifespan and this hot of an item, you want to get as many people on board your own platform as possible before it's too late. Once you've exhausted your sales potential, that's when you really need to focus on subs. Truth is, by that time, in the console industry, if you don't have new next gen or Switch competitor hardware ready to go, your going to pay for it one way or another.