Sony likely made more money than you this quarter.
Sony likely made more money than you this quarter.
Image: Sony

According to Sony’s first-quarter financial results for 2020, PlayStation Plus currently has nearly 45 million active users around the world, a gain of nearly 3.4 million over the previous quarter. That number should jump significantly now that Fall Guys is a free PlayStation Plus game.

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DISCUSSION

I think the world of console multiplayer subscriptions is going to get very interesting very soon. Rumors of Microsoft making Xbox Live Gold free are popping up more and more - and while that makes sense as it has the effect of possibly driving more users to GamePass once they don’t have to pay for live, I think it also might be a case of Microsoft leveraging its insanely healthy balance sheet to put pressure on Sony.

Think about it - if that happens, Sony has two choices:

1. Keep their revenue stream from PS Plus, which this data shows is pretty enormous (3 billion a year in revenue) - this revenue stream is likely to be especially important in enabling them to take a loss on PS5 sales so they can meet or beat the Series X price

2. Make it free, to avoid giving Microsoft a fairly substantial advantage when consumers compare the two platforms - but then not only abandon a huge chunk of revenue that could be used to offset console losses, but still keep all the associated expenses, making it even harder to take that loss. This makes it a lot harder for them to compete with the Series X on price, I suspect.

Sony actually isn’t in a great place here, because while they do have PS Now, they’re not nearly as well situated as Microsoft when it comes to having a new subscription service to transition all their premium users to if they make it free.

It’s exciting that Sony seems to really be doubling down on “we’ve got great exclusives to offer you” - but it really seems to me that Microsoft is setting themselves up with a great strategy designed to make sure that is the only advantage Sony can tout, and one that has to make up for lower power, and now also probably either one or both of “more expensive” and “online play isn’t free”.