Karol Severin is MIDiA Research’s lead analyst for research on games and the mobile content economy.
The majority of the gaming industry is pro cross-platform gaming and truly sees it as the natural evolution of the industry. Sony, however, is retaining the walled garden model as manifested by the recent Fortnite issue. Long story short:
- Sony has been subject to critique in the past for avoiding cross-platform play for PlayStation Network users
- Epic Games (creator of Fortnite) account holders on PlayStation are now unable to log-in to them via Switch
You will have seen the current uproar this is causing among players. It is spurred on by the media as they draw comparisons to Xbox, which made a point out of supporting cross-platform play in the past and reiterated this during its E3 press conference.
The general narrative is: Could the Fortnite issue finally make PlayStation cave in to the cross-play demands of the rest of the industry? In short, no (and from Sony’s business strategy standpoint, rightly so). And here is why:
PlayStation is a chip leader, protecting a not-so-growing console gamer market
Console ownership is flat. In Q4 2016, 36 per cent of consumers in the English-speaking markets owned a games console, compared to 30 per cent in Q4 2017. Because console adoption is not growing, competitive platform wars are all about convincing existing console gamers to switch to a rival platform by the time the next generation of hardware comes out.
PlayStation has the largest console gaming ecosystem out there (side note: this didn’t happen by coincidence, but because PlayStation manages to consistently offer hardware and content catalogue that resonates with gamers).
It knows that growth of the non-hardware part of its gaming business is moving towards monetising engagement of existing users, rather than expecting significant increases of new users. The more important engagement becomes in gaming monetisation, the more of an upper hand will PlayStation have over its rivals by having the largest active user base. Therefore, it needs to protect its user base lead at any cost.
Xbox has far more to gain from cross-platform than PlayStation
Quite simply, Microsoft owns two gaming platforms (Xbox and Windows), while Sony has just one (PlayStation). Furthermore, fewer users on Xbox means emptier lobbies in multiplayer games. This is not to say that Xbox’s game lobbies are empty, but the difference in user base increases the probability of having to wait for longer on Xbox than PS4 to get your session going, which can lead to a subpar user experience.
Cross-platform gaming can improve this experience for Xbox users and help close the gap. This makes it convenient for Xbox to push the cross-platform narrative and spotlight the resilient Sony in the process, in a bid to capture some market share from disgruntled fans. However, the truth is that PS is not building a walled garden because it wants to aggravate gamers, but simply because it has incomparably less to gain from cross-platform than its main rival. In fact, it would be losing some of its competitive advantage.
The lock on PlayStation’s walled garden is stronger than it seems
Gaming network friendships are often formed between people who don’t know each other in real life. Gamers happen to be in the same gaming session, help each other out and subsequently send a friend request. The more online-multiplayer-centric gaming becomes, the more players will need ‘friends’ in their network to enjoy the experience fully. Real-life friend networks are not large enough to ensure that there will be real-life friends available whenever a gamer wants to engage in a session and needs help. So even though ‘playing with real friends’ would be nice, players would likely still need their ‘random friend connections’ to truly play at their own convenience. Some players have spent a lot of time building their friends list, but if they decide to change from PS to Xbox, they will lose them and have to start again.
This makes PlayStation’s ecosystem lock more powerful than many realise. The first consumer thought may be: I’m fed up, I want to change platform. Indeed, some may do just that. Others however, will take a deep breath, weigh out the pros and cons and if they care about their game progress and player network more than playing with real-life friends (which high-spending hardcore gamers do), then the smarter choice may be to stay loyal.
Karol Severin is MIDiA Research’s lead analyst for research on games and the mobile content economy. Karol’s research covers all aspects of games including mobile games, online games and console games as well as the mobile app economy, freemium strategy and consumer segmentation. Prior to joining MIDiA Karol gained experience in a number of marketing, research and consultancy roles, as well as a technology start up founder. He can be reached at firstname.lastname@example.org.