Trying to find the pie chart I saw years ago on Gamasutra, but $10-$15 of a game sold goes to the console holder. So let's say somebody buys a PS4 and ten games. This is lowballing it, but Sony makes $100-$150 in console royalty fees from those 10 games. Add in an average of $20 a year in PSN fees for five years, since about 1/3rd of users are subbed to PS+. Let's say that keeping Horizon on PS4 for good improves the Playstation brand enough to sell an additional 2 million PS5's in the future. That's $400,000,000 dollars in future profit ($100 in royalty fees + $100 for 5 years of PS+ from 1/3rd of those 2 million users.)
Meanwhile Horizon will likely be bought at bargain basement prices on Steam. Probably around $20 a copy, just like the PS Store. At 2 million copies sold (this is being generous), they'd make about ($14 per copy) $28,000,000.
So we are comparing $28,000,000 vs $400,000,000. Sony is basically burning their own brand to the ground at this point.
But oh well, it does benefit us gamers. I might not even get a PS5 until 2022 or 2023 now, because I'll have no need. My 2070S Rig will work fine.
Keep in mind that consoles cost money to make and a fortune to RnD. So basiaclly hardware loses money while the software and subscribers make that money back. Depending on how fast the console sells determine weather they make there money back on the console earlier. Its why Sony hasnt gone full PC yet due to the amount of success the PS4 has been this generation.
However that success is not always guaranteed every generation and with competition only increasing it could mean less overall sales which hurts shareholders etc.
This Gen Sony were awfully lucky that both Nintendo and Xbox slipped up and led a 1 way ticket to success however with Nintendos recent success of the Switch and Xboxes revival, Sony are going to have to think about the bigger picture because there is too much money to lose by sticking to 1 format unless they are Nintendo which they are not.
It's true that consoles cost money to make and research. My estimate was an extreme lowball though. There's easily enough wiggle room in those numbers to make R&D costs and production costs disappear.
Competition increasing? From what? Streaming? Stadia and the like are the 3D0 and Jaguar of the 2020's.
Yes, less console sales hurts shareholders.
As far as mainline home consoles go Nintendo has a pretty good track record for messing up. N64, Gamecube, and Wii U were all failures. NES, SNES, and Wii were successes. It's no surprise that a company that had two console sales failures (N64 and GC), followed by a huge hit (Wii), would drop back to low sales a gen later. So I wouldn't attribute that to luck.
Xbox did indeed slip up, but Sony definitely handled this gen well. They made all the right decisions. Sony's excellent studios, good gameplay focused hardware, and consumer friendly stance took the market just as much as Xbox gave it away.
I don't think Xbox will have a resurgence at all. They face a Sony that is coming off a PS4 high note, and horrible sales of the XB1 this late in the gen. If it does though, that would be a result of Sony throwing all their exclusives onto other platforms, and basically giving up on the strength of their brand. Even then though, I don't see Xbox ever passing 65 million lifetime sales ever again.
Sony is basically Nintendo, but with full blown 3rd party support. They've raised their 1st party content up to Nintendo's level, while still getting pretty much every 3rd party AAA game. And remember there's way more money to be lost by abandoning their brand, than there is from a few extra PC sales.
What Sony really needs to do is focus on improving the PS brand, while making PSNow a serious competitor to gamepass. That way when streaming eventually takes over, in ten years, they can dominate the streaming market as much as they dominated the console market. Instead, they seem hellbent on pulling a MS, and becoming a 3rd party developer that just happens to have a console on the side.