As Sony celebrates hitting 2m PS4s sold in the UK, MCV meets UK MD Fergal Gara to discuss price wars, the next generation of PS4 owners and what has happened to all the games…
"ANY PRICE WAR IN THE MARKET CAN BE DANGEROUS"
One thing that has defined the on-going battle between Xbox One and PS4 over the past 12 months has been a price war. Xbox One has seen its price reduced by 130 in the UK since the machine launched (a reduction aided by removing Kinect from the box).
Sony hasn’t let Microsoft undercut it, however. The firm, with the help of retail, has matched the price movements of Xbox. The result has seen both consoles fall well below 300 on the High Street.
It’s good for consumers, but with GAME and Xbox reporting lower revenue numbers, has it been worth it?
Any price war in any sector in any market can be dangerous,” says PlayStation UK boss Fergal Gara. If there is a race to zero, who wins from that? We are proud that we managed to launch at a very competitive price, and demand has held up very strongly for PS4.
Therefore, our RRP on day one is our RRP today. Yes, there are promotions that offer consumers better value from time-to-time, but it’s great that we managed to start at such a great price and it has held well.”
"BLOODBORNE TOOK US BY SURPRISE"
There hasn’t been an especially large line-up of games for PS4 or Xbox One, but one recent title that has stood out is Bloodborne.
Currently the highest rated game on the new consoles, Bloodborne is a PS4 exclusive akin to the Dark Souls series (it was developed by the same studio). The Souls series has a cult following, but the games haven’t exactly been commercial smash hits. Partly because of this, the sheer scale of Bloodborne’s sales caught Sony somewhat unawares.
It did surprise us,” says Gara. We had expectations to do well. We looked at the Souls series as a frame of reference, and we thought we could do better than that. We did – and then some. Relative to some of our sister territories, we were being quite ambitious, but even that proved to be conservative.
I think Bloodborne might have just landed just at the right time; it was a relatively quiet time, it was a very high quality title and a great platform differentiator for us. We were caught a little bit behind in terms of the volume, but we were able to chase it and maximise its potential.”
"THE GAMES ARE COMING"
For all the commercial success of PS4 (and, indeed, Xbox One) there remains a dearth of titles hitting the platforms. Gara insists the games are coming, and that the relatively slow start to this generation may be the result of too many titles failing to impress at launch.
My sense is that the new platforms have opened up the ambitions of developers and the capabilities of what they can achieve,” he tells MCV. What has then happened since has been a bit of rushing to market and a couple of not perfect launches. That’s perhaps driven some conservatism to not overly force this and make sure we get it right – there’s been an adjustment of pace.
The good news is that the ability to stick to timelines will improve as people get experience of the hardware under their belts. I have been hearing stories from around the industry that give me assurance that developers have got a better grasp on things, so we will be in increasingly good shape.”
The immediate challenge for Sony, however, is this Christmas. Xbox already boasts a line-up that contains exclusive titles such as Rise of the Tomb Raider, Halo 5 and Forza 6. But PlayStation has been tight-lipped on its plans.
I won’t go into any detail now,” adds Gara. There is plenty for gamers to get excited about already, such as Tearaway for PS4 and No Man’s Sky. That’s just the start of what is on the table right now. So I don’t have any concerns that we will have a lack of strong software for PS4
"THERE IS MORE WE COULD DO WITH PS3, BUT PS4 IS THE FOCUS"
The rapid rise of PS4 has seemingly taken its toll on PlayStation 3, which has seen sales fall sharply since the start of the year.
In previous generations of consoles, particularly with PS2, Sony has been able to reduce the cost of its older machines and sell them to younger players and families. However, UK boss Fergal Gara says the potential to do the same with PS3 is limited.
There is no doubt that at this stage, and with the success we have enjoyed globally, that our focus is on PS4,” he comments. There is more that we could do with PS3 on a promotional level, but don’t expect us to do anything near to what we are doing with PS4, because that is the future.
PS3, as has been pretty well documented, was a heavily engineered machine, and there’s a limited ability to take significant cost out of it.
It will certainly be around for this year and beyond, but don’t expect it to have anywhere near as much focus in the UK as PS4. The gap between the two is very, very wide.”
"THIS IS A KEY YEAR WHERE WE SHOULD BE REACHING YOUNGER AUDIENCES"
With 2m PS4s sold in the UK, Sony has now set its sights on the next generation of players.
This is a key year where we should be reaching younger audiences,” UK MD Fergal Gara says. We have some first-party software that can certainly reach into the younger age groups, such as Tearaway for PS4. Plus, there are games that go across the age spectrum, like FIFA.
The toys-to-life category is looking strong this year, and the return of Guitar Hero and Rock Band will hopefully revive interest in that genre. It is perfect timing really as we head into our third Christmas.
There are other franchises that are gamer titles but are also broader and more accessible; I would pick out Star Wars Battlefront and Arkham Knight.”
"BLACK FRIDAY IS NOT GOING AWAY"
One of the biggest sales periods for PS4 over the last 12 months was Black Friday. But Sony says that, rather than generating extra sales, the event actually had a negative impact on the rest of Christmas.
The peak season is what we expected to be, just not in the shape we expected,” says UK MD Fergal Gara. As we learned of retail’s aspirations [for Black Friday] we raised our forecasts, but it surpassed any ideas we had. But it caused lower December numbers than we were used to.”
PS4, Xbox One and a host of big games all received major price discounts over that weekend, but if it didn’t have any positive impact on sales overall, will the industry be doing it again this year?
The feedback we are getting from retail is that Black Friday is not going to go away,” says Gara. Are there new ideas of how to approach it percolating? Yes, to some degree. But it is pretty early days in terms of having any clear ideas of exactly what shape it will take.
Black Friday came from almost nowhere. It reached similar levels of maturity to the US in its first real outing. If you look at the percentage of the total year’s sales achieved that weekend, it is very much in the ballpark of the US – and it happened over several years over there.”