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When Microsoft announced last month that it is acquiring Call of Duty publisher Activision Blizzard for $69 billion, a lot of people wondered aloud how Sony could possibly compete. And to a point, that concern is fair. Microsoft is a $2-trillion company with a lot of cash to burn. Sony, meanwhile, is just your standard multibillion-dollar conglomerate. But in a world where Google, Tencent, Amazon, and other trillion-dollar companies are eying video games, Sony’s PlayStation is still well-positioned to compete, thrive, and even come out on top.

Sony’s strength is that it has the money, expertise, and properties to take on almost any idea. And the company has already shown a willingness to put a variety of strategic pieces into place for its future.

The most important strategy for Sony is, of course, the core PlayStation business. PlayStation fans brought the company to the dance, and Sony is at no risk of abandoning them as its primary dance partner.

Sony’s Games & Network Services division generated $25 billion in revenue last year along with $2.6 billion in profit. That makes it the second-largest gaming-focused business in the world behind only China’s incomprehensibly large Tencent.

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But on top of that success, PlayStation boss Jim Ryan is sniffing out new pathways for growth. And unlike Microsoft’s Xbox, Ryan is considering a more all-encompassing strategy.

PlayStation is doing it all

Sony is going to keep making the games and consoles that it’s known for. PlayStation 5 will continue flying off shelves — if one ever ends up on a shelf — and PlayStation Studios will keep pumping out game of the year contenders. And that will lead to its own growth — although that is a slow-and-steady process.

Games like The Last of Us Part 2 and Horizon Forbidden West are expensive to make and don’t have profit margins like a live-service juggernaut. But that leads directly into new ways to capitalize on the success of its games, and the company seems willing and capable of doing it all.

And by all, I mean that Sony’s investments look a lot like what would happen if you combined Xbox, Ubisoft, and Nintendo all into one.

Movies and television

Like Nintendo, Sony is looking at ways to increase the value of its PlayStation brands through other mediums like movies and television. What’s different for Sony is that it owns one of the biggest movie studios in Hollywood in Sony Pictures. So while Nintendo is partnering with Illumination and slowly rolling out a plan for more films after that, Sony is debuting Uncharted in theaters this week. The Last of Us series, meanwhile, is coming to HBO soon as well.

Through nearly three decades of PlayStation, we haven’t seen Sony leverage this kind of synergy before. It is now because Sony Pictures, like the rest of Hollywood, wants to bet on familiar IP. The timing also makes sense because PlayStation is now Sony’s obvious crown jewel. Everything else is now working to support that business.

But this also is, of course, the direction that the industry is moving as a whole.

Sony is simply one of the company best positioned to take advantage of these trends. And that is the overall point: PlayStation’s potential avenues for growth are diverse because the company is capable in so many different markets.

Live-service games

The thought that originally provoked this story for me is the contrast between Ubisoft and PlayStation. Both companies are looking toward a future with more live-service based games. But Ubisoft has left behind its old “blueprint” style of making games in favor of its new “mothership and satellite” approach. Up until 2018, Ubisoft would try to release games in the Assassin’s Creed, Far Cry, and other franchise blueprints as frequently as possible. Since then, however, the company has decided to shift to a model where it publishes a massive live-service game in each franchise that last for years and then it would push out smaller satellite games in those franchises at a faster rate.

Ubisoft’s specific shift in strategy isn’t as important as the shifting itself. Sony is also pursuing live-service games. The company told investors when it announced its planned acquisition of Bungie that it is making 10 games-as-a-service products.

The key point is that Sony is making those 10 live-service games in addition to the new God of War and Horizon games. While Ubisoft and a lot of other publishers have to pick and choose where to spend their budgets, PlayStation is profitable enough to do it all.

Subscription services

The most common comparison for PlayStation is to Xbox and its Xbox Game Pass service. Microsoft is working on creating a Netflix of games, and it has spent a approximately $100 billion to do so. To ensure the appeal of Game Pass, Microsoft even puts all of its own games into the service the first day they release. So instead of paying $60 or $70 (or more in other countries) for a new game, you can drop $10 or $15 per month instead.

Microsoft’s strategy is a bold, long-term play that feels like an inevitability. So naturally, industry observers want to know how — or even if — Sony can respond. But again, while PlayStation competitors continue to niche down into specific strategies, Sony is fully capable of doing everything.

Sony is going to keep making its games with budgets north of $120 million, and as former PlayStation boss Shawn Layden said last year, those games won’t make financial sense in a $10-per-month service any time soon.

“You pencil it out, you’re going to have to have 500 million subscribers before you start to recoup your investment,” Layden told Gamesindustry.biz in July. “That’s why right now you need to take a loss-leading position to try to grow that base.”

But even without God of War Ragnarok coming into PS+ on day one, Sony has managed to attract 48 million subscribers to its PS+ membership program. And it has 111 million monthly active users who are spending money on games like Fortnite, Apex Legends, and more.

So while it’s easy to look from the outside and wonder how Sony is going to respond to Xbox Game Pass, the reality is that on the inside, Sony is only wondering how to grow on the success it already has.

And that is how the company is building out its strategy with a more robust subscription offering under the codename Spartacus, according to a Bloomberg report.

PlayStation has too many strengths to get hung up on the weaknesses

None of this is to say that PlayStation doesn’t have weak points. Sony would love to have its first-party games sell more like Nintendo’s first-party offerings. And the company would enjoy having a first-party multiplayer live-service game that could make enough money to offset the costs of making a new Last of Us.

But the takeaway from current Sony is that it has sound fundamentals, and it has a plan for how to grow in all those key areas. And anywhere that it is weak, it seems to already have a plan to address those concerns. PlayStation’s first-party has a growing list of games that have sold more than 15 million copies. And it is purchasing Bungie specifically to address its need for live-service expertise.

While Microsoft continues to insist that it is competing with Amazon and Tencent, and while Nintendo is off doing its own thing, Sony continues to make all the smart moves to ensure it is going to continue its dominance of this business for this console generation and beyond.

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