Don’t panic, Sony — you don’t need any more PlayStation Studios

What will Sony's reaction to Microsoft's acquisition of Activision Blizzard be? Here's hoping that acquiring more PlayStation Studios isn't the answer.

Opinion by Kes Eylers-Stephenson

Published 18 Oct 2023

Sony has steadily built its stable of PlayStation Studios primarily using teams it's worked with before. That is until industry consolidation left the Japanese company angling towards development giants like Bungie and untested teams like Firewalk Studios and Haven Studios. Now, we are wondering what Sony's reaction to Microsoft's acquisition of Activision Blizzard will look like and hoping that it doesn't revolve around endless acquisition.

How will Sony react to Microsoft's acquisition of Activision Blizzard?

So, Microsoft's acquisition of Activision Blizzard for $68.7 billion is done and dusted, with regulators sealing approval. With this move bringing the profits of Call of Duty to Microsoft as well as gifting Xbox the Crash Bandicoot and Spyro the Dragon brands alongside IPs like Diablo, Overwatch, and more, there is a sense that Sony has to respond in some way.

I think, generally, under the pressure of Microsoft's enormous purchase there seems to be a feeling amongst hardy fans that Sony should respond with further acquisitions to add to its current 20-team roster, not including support studios. However, I am inclined to disagree that raw acquisition is the best way forward based on three factors: the games industry is in transition, we have no idea what PlayStation Studios is doing, and we have no idea how Microsoft will control Activision Blizzard.

Live-service games headline an unpredictable industry

Right now, it feels like we are at a point in which gaming habits have changed. If you look at the PlayStation Chart every week, you'll notice that the top five most popular games are dominated by live service games. A majority of players have one or two games they spend a majority of their time with — an EA Sports 24 or a Call of Duty Warzone — before dipping into the AAA pool of single-player releases once or twice a year and, to a lesser extent, a particularly interesting indie game.

Live-service gaming doesn't operate on the normal profit margins of 'selling x amount of copies.' Time is the new currency. If you can convince enough people to invest time in your game, you'll eventually have them investing in small microtransactions to help line your pockets. Occasionally, you might even catch a whale who will pay their way to the top. It's a new business model and one that is evolving rapidly with many caveats, but that's the general idea.

Indeed, because time is the currency and the established live service games take up the most time, there isn't much free time left to be spread around to other games. At this point, you either have a game that's already a popular live service, like Microsoft now has with Overwatch 2 and Call of Duty Warzone, or you dont. A few developers and publishers have slowly figured this out. XDefiant from Ubisoft has been delayed once again; Sega canceled Hyenas despite it being nigh-on complete; even big IPs like Marvel's Avengers have failed. Live-service gaming is saturated and publishers know it (or at least they should).

If the live-service market is set to open up or evolve again, it's going to do so suddenly and erratically, and that's only if the appetite live-service games continues to hold out over the next few years — otherwise, we could be looking at something completely different. Either way, Sony buying more teams to chase that dream isn't going to work. If Haven, Bungie, and Firewalk aren't able to make any further headroom in the live-service space, Sony would be better just staying put and either waiting for an opening, or forging a different path.

Sony's PlayStation Studios are silent right now

Imagine you are one of gaming's biggest companies watching Fortnite, Call of Duty Warzone, Apex Legends, or EA Sports 24 dominating that model. Of course, you'd be thinking: "Why are we not capable of doing that with some of the world's best developers at our disposal?" I think there are many holes in that logic — "a good single-player game developer does not make a good live-service developer" certainly being one of them — but last we heard from Sony, that is the way the company is thinking.

Sony is doing its best to match that live-service output by transitioning some existing teams to that cause. Naughty Dog is struggling with The Last of Us Factions, Firewalk has Concord, Haven has Fairgame$, Bungie has Marathon and Destiny, and London Studios is working on something too. Just one big live-service hit would do the job of having players spend endless time with Sony's games and start a constant stream of small monetary transactions, so you can see the appeal of throwing all your best teams at that dream.

That said, PlayStation Studios can't help but look like a black hole of development talent right now. If Sony is thinking of buying a new developer, publisher, or whatever, imagine the optics of throwing another acquired studio in there without any confirmed single-player games beyond Marvel's Spider-Man 2 and Marvel's Wolverine coming out. All I'm saying is that they should really be managing the existing selection of teams, making players confident in the line-up, and then seeing where they stand before making any potential M&A move.

Microsoft's Xbox brand is a tricky task to manage

If Sony's PlayStation Studios looks like a hard deal to sort out between live-service games, single-player output, and telling people what on earth they should look forward to, Microsoft has an equally tall task after the acquisition. Under Microsoft Gaming lies three big umbrellas: Activision Blizzard, ZeniMax Media, and Xbox Game Studios housing 39 teams. That is an ungodly amount of work to manage even if each section has its own leadership. It begs the question, can Microsoft manage that much under its gaming brand?

Xbox's output has been mixed for years. From Redfall's general state, to Halo Infinite at launch, to endless delays for Hellblade 2, Fable, and more. Its major successes have been with Forza Horizon and Forza Motorsport. Starfield has been received well at release, but the road there was a notoriously tricky and long one for Bethesda. Though more minor releases from Double Fine's Psychonauts 2, Pentiment from a minor team in Obsidian, as well as Hi-Fi Rush from Tango have been awesome, they aren't the AAA needle movers (though, Pentiment sure deserves to be one!).

This is all to say, Microsoft has another branch to manage now and its output was mixed with two. I look at Microsoft's massive scale, endless money, and difficult management tasks and I don't see how the comparatively small Sony could cope with more than the 20 teams it has right now. If it was going to fit more in, surely it'd take years to put management in place, but CEO Jim Ryan is retiring soon. A reactionary acquisition from Sony would surely place way too much stress on a stressed machine.

So, between an unpredictable industry, a roster of studios that still need to prove themselves, and the fact that Microsoft has yet to manage its own growth, any suggestion that Sony should continue to expand seems very reactionary to me. All people need right now is to know PlayStation has the games they want and a stable hand at the wheel — that’s why I think Sony should instead keep its head down, get some games out of the door, and convince people all is well.

What do you think of all this? Let's hope Sony's lineup of PS5 exclusives convinces us that PlayStation Studios is going in the right direction! This is just my opinion, so make sure you get in the comments and let me know what you think of it all down there!

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Written by Kes Eylers-Stephenson

Editor-in-Chief Kes is our resident expert in PlayStation and Sony news. He writes about PS5 games like The Witcher IV, Assassin’s Creed Shadows, and Kingdom Come Deliverance II using experience from years of PlayStation gaming. He also covers PS Plus news and some of the best PS5 games — Uncharted, God of War, and The Last of Us — before an evening swim.