NOV. 3, 2014 • The PlayStation Plus streaming service has grown to 7.9 million subscribers, according to the Sony Corporation. The disclosure was made by chief financial officer Kenichiro Yoshida during a financial conference call on October 31 discussing results for the quarter ending September 30. For the quarter sales by the Game and Network Services segment increased 83.2% year over year to ¥309.5 billion ($2.7 billion). This was thanks to strong PlayStation 4 hardware and software sales, plus an uptick in network services revenue that includes digital distribution through the PlayStation Network as well as PlayStation Plus. Prior to April 1, Sony reported Network Services revenue under the All Other category.
Impact: Sony has high hopes that online revenue can help the company to battle back against competitors such as Samsung Electronics and Apple Inc. who have cut into consumer electronics hardware market share. Last May, Sony chief executive Kazuo Hirai told the Reuters news service that the PS4 is the prime driver for network revenue, and such online services are expected to become the key component of revenue growth for the company as a whole. At the time, Sony’s network services had 52 million active users, most of whom were PlayStation console owners. On a May 14 conference call, Yoshida said more than half of the 7 million PS4 console units sold had been subscribed to PS Plus. While there is no doubt the main contributor to Plus subscriptions comes via the PS4, how many of that 7.9 million number comes via PS Vita, Bravia HDTVs and PlayStation TV users is unknown. Right now we think most of the growth is driven by the PlayStation 4, but that could change if Sony could figure a way to promote PlayStation Plus features to other devices. DFC views PS Plus-capable HDTVs as a major selling point compared to competing brands. There is not a lot to set high-definition televisions apart between the major consumer electronics manufacturers, who are already very price competitive. But PS Plus – backed by Sony’s huge catalog of game, music, and film content – is just the feature to give the firm some added traction as Hirai outlined. The value add is not as clear cut when you get to mobile devices given the entrenchment of the Apple App Store and Google Play as content sources. Given that Plus launched in the middle of 2010, it is obvious that the arrival of the PS4 has approximately doubled the subscriber base. Now it is up to Sony to find a way to translate that momentum to its non-console devices.
