Will Sony claim the Metaverse Prize?

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1. Introduction

Instead of looking directly at $Microsoft (MSFT.US)$, I would like to study its competitor in the console gaming enviroment $Sony (SONY.US)$ .

2. Sony's Edge

Sony is the company behind many of your daily Entertainment. Sony's main revenue segment in the game and network services segment (23.9%). Revenue in the game and network segment is mainly driven by PS5 hardware and peripheral devices sales and first and non-first party game titles.

Historically, I believe Sony's Play Station's advantage over its competitors is its exclusive games. But recently, Microsoft acquisition of Activision Blizzard has signaled a rev up in consolidation in the gaming sector. Although denied by Microsoft and Activision Blizzard, this consolidation poses a threat to Sony's competitiveness. FYI, Activision Blizzard is the publisher of Call of Duty an Activision's PlayStation Exclusive. In a hilarious turn of even, Sony acquired Bungie, the makers of Halo and Destiny.

Perhaps Sony could maintain its dominance through merger and acquisition. But will this be enough?

Spider-Man into the Spider-Verse

Sony also has congruence with its other company segment. One example of this is in its movie making production studio. Sony Pictures Entertainment has some hugely popular IP, both in the gaming sector and pop culture, such as Uncharted and Spiderman respectively. These IP's acquired by Sony could further expand the popularity of Sony's Play Station's offerings. This however requires excellent execution of entertainment product developed based on these IPs.

3. Microsoft's Edge

Xbox Game Pass

Aside from IPs, Sony also faces strong competition in terms of game streaming. Microsoft has a popular cross platform game streaming service called Xbox Game Pass. Xbox Game Pass allows players to stream games titles from the cloud on PC, phones, Tablets and Xbox consoles. This subscription service provides substantial value to Microsoft's customers. It would also restructure payment model within the gaming industry. Moreover, Xbox game streaming services might be congruent with Microsoft cloud services.

Xbox Game Pass is significant because it allows users without the necessary hardware to play triple A titles. It also lowers the barriers for users to try a game as it will require no extra cost for players to start playing a game from the Xbox Game Pass Library. This will

1) Expand gamming customer base for both Microsoft and Game Developers.
2) It might also increase revenue for developers, depending on how streaming revenue is shared.

Moreover, Xbox Game Pass might be congruent with Microsoft's cloud services. All these pose a serious threat to Sony's dominance if it is not able to keep up with Microsoft's offerings.

4. Conclusion

Having said all these, at this current stage, Sony remains the market leader in terms of gaming console. Whether or not this dominance remains would depend on Sony's ability to grow its Intellectual Properties and to provide substantial value to its player base by supporting third party game developers and expanding its product offering into streaming.

5. Interesting Facts about Sony

1st-Game and Network Services Segment (23.9%):

-PS5 crazy and meme floating around.

2nd-Music Segment (10.3%):

-Produces and Publishes music

3rd-Pictures Segment (12.3%):

-Spiderman No Way Home is the highest grossing film of 2021

4th -Electronics Product and Solutions Segment (4.4%):

-Home Entertainment Segment: Produces LCD TV, home Audio System

-Mobile Phone Segment

5th– Imaging and Sensing Solutions (13%):

-Semiconductor Segment: provides image sensor image sensors and camera modules

6th-Financial Services (15.8%):

-Financial Services Segment: life insurance and non-life insurance operations and banking business