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When Sony executive John Tsuyoshi Kodera told investors this week that the PlayStation 4 is entering the “final phase of its life cycle,” there were two ways to parse the news. You could disbelieve it — it’s a mistake, an overstatement, or likely to change — or assume that Sony was dead serious and already planning for the PlayStation 5. Sony later clarified that Kodera was referring to a three-year transition from PS4 to PS5, but the damage was done: Developers and consumers alike are going to spend the next three years thinking not about what’s here but what’s coming next.
Kodera’s statement has huge ramifications for the next version of PSVR. Technically, Sony could release an all-new headset tomorrow for the PS4 and continue to support it for the PS5. By historic standards, that would be unusual. Each new console generation typically makes changes to everything — I/O ports, internals, etc. — so the PS5 might well have different connectors and system architectures from the PS4. Would Sony spend the time and money to make a PS4 version of PSVR 2 right now, knowing that it might need to update the accessory again for PS5?
There’s one reason to think the answer is “yes.”
Years ago, Sony hired Mark Cerny to lead PS4 architecture development, and after the platform’s wild success with developers and customers, reports suggest that he’s taking a similar role for the PS5. Unlike his predecessor, Ken Kutaragi, who treated every new PlayStation generation as a fresh start, Cerny appeared to be laying a foundation for Sony to make smooth generational transitions. If Sony keeps the PS5’s architecture basically the same as the PS4 Pro’s, but with new generation-worthy CPU and GPU upgrades, it could preserve software and accessory compatibility.
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In the past, Sony has generally enabled PlayStations to offer some backward compatibility via extra chips or emulation — the PS4 was an exception. But directly building upon the PS4 platform’s I/O and software would enable a PSVR 2 headset to work on both hardware generations — just like PSVR did for the PS4 and PS4 Pro — and start building up a base of users sooner rather than later.
While an all-new PS5 platform isn’t hard to imagine, it strikes me as the profoundly wrong move for Sony to make right now. Kodera’s comments on the PS4’s supposed demise hit just as God of War was named the strongest initial seller of any PlayStation exclusive in history. That happened precisely because Sony has a gigantic PS4 user base spread across entry- and Pro-level consoles, numbers that would take years for an all-new successor platform to match.
There’s only one reason a Sony executive would start discussing the death of a thriving platform right now: to let investors know that Sony is going to ramp up PS5 hardware R&D spending in the near future, while cutting down PS4 hardware efforts. Unfortunately, that candor will likely damage PS4 sales somewhat and frighten developers away from spending their time on PS4 games. The consequence will be that some upcoming titles will get pulled from an established platform with 80 million users in favor of a future platform that may reach only 10 million early adopters in year one. Chasing PS5 rather than PS4 customers will certainly hurt such games’ eventual sales.
Industry research firm SuperData isn’t concerned about PS4 hardware or software sales, at least for the time being. “Until details of the PS5 are public, sales for PS4 should continue to be strong,” said the company’s Joost van Dreunen. “It is the top dog in the console market and we’re looking at a strong release slate in the console market for the foreseeable future: the recently released God of War (which sold 5MM units in its first month), Take-Two’s upcoming Red Dead Redemption 2, and the new Spider-Man game are likely to help drive hardware sales, too. Especially in combination with discounts to reel in price-conscious consumers, we are not yet at the end of the line for the PS4.”
My biggest concern is that Sony is at a crossroads with PSVR and doesn’t fully appreciate how important its next move is — both for consumers and the VR industry as a whole. The company said that while PSVR is selling well, the VR market as a whole isn’t growing as much as had been expected. As such, the company is apparently going to be extra careful about its next moves with VR. But Sony isn’t responsible for the pricing, development, or marketing errors of the rest of the VR market; it needs to focus on making its own products compelling, period.
It strikes me as obvious that the PSVR’s relative success results from its affordable price and compatibility with an increasingly popular platform. At a time when HTC is focusing on super-expensive headsets and some VR developers are refocusing on games and accessories for location-based VR centers, Sony is at a mass-market pricing sweet spot. It sells $200-$300 VR bundles that deliver a better experience than the standalone Oculus Go or Lenovo Mirage Solo at similar price points, assuming you already own a PlayStation 4 console. Lots of people do.
That said, SuperData doesn’t view the current PSVR as a clear hit. “With a little over 2 million units sold the PSVR has not been the success it had hoped,” van Dreunen told us, “despite having the largest console install base. To chase a losing hand would be unwise and, more importantly, go against its recently announced second realization, namely that Sony is going to be focusing more on digitally distributed content. Under the new leadership of CEO Kenichiro Yoshida, Sony bought an additional 60% stake in EMI Music Publishing just this week and revealed its plans to focus on subscription revenue from online gaming and streaming music and video. It is not immediately apparent how a PSVR 2 would fit into that strategy.”
Rather than staying stagnant or retreating from its current position, I believe that boldness will win Sony an even bigger share of the growing VR market. This is precisely the time to release an even better, stronger PSVR 2 at a mainstream price point, as that — rather than a decent $200 Oculus Go or basically unaffordable $700 Vive Pro — will actually keep moving the market forward. Waiting three or more years to debut PSVR 2 solely for the PS5, when people will already need to lay out several hundred dollars for a new console, would be a deeply wrong-headed move. If the PSVR 1 is like the first-generation iPod, it’s just waiting for the right refinements and pricing to take off like a rocket.
I’ll admit to being a little selfish here. I can’t wait that long to see what Sony and its developers do with next-generation VR screens, controllers, and games. If they move quickly enough with PSVR 2, PSVR fans probably won’t switch to a competing option.
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