Former PlayStation Boss Shawn Layden Sees Google, Netflix, Apple, and Amazon as Threats to Gaming - News
by William D'Angelo , posted on 02 November 2023 / 6,772 Views
The former PlayStation boss Shawn Layden in an interview with GamesIndustry listed three big concerns he believes the video game industry will face in the coming years.
"First, consolidation can be an enemy of creativity," said Layden. "I also think rising costs in gaming are an existential threat to all of us. And the entry of non-endemics into the sector – otherwise known as the 'barbarians at the gate.'
"Right now we see all the big players going, 'Oh, gaming? It's bringing in billions of dollars a year? I want a piece of that' And so we have Google, Netflix, Apple and Amazon wanting to get piece and trying to disrupt out industry."
He added the video game industry needs to learn what happened to the music industry when Apple "convinced everyone that 99 cents per song was a good idea." He also said Netflix has disrupted the movie industry.
"I'm hoping gaming will be the first industry where we disrupt ourselves," he said. "Where it doesn’t take a Google or an Amazon to completely flip the table. We should be smart enough to see these changes coming and prepare ourselves for that eventuality."
It was brought up that Sony and Microsoft were non-endemic to the video game industry when they entered the market.
"[Sony] knew enough that entertainment was its own beast, so Electronics knew it couldn't manage this business by taking all the guys from the CD division and go after games," said Layden.
"So in the initial stages of the company, it was a joint venture between Sony Electronics and Sony Music Japan. They knew they had to bring the entertainment… right from the beginning. The people handling the advertising, marketing, publisher relations, PR – those were all Sony Music guys – and they were soliciting publishers to support the platform.
"PlayStation knew that we couldn't do what Sega and Nintendo did and [provide the bulk of the software], we didn't know enough how to make it. We had to be the third-party platform, so we had to get Namco, Square, EA, Activision. Those Sony Music guys are the ones that got Square to move Final Fantasy VII off of Nintendo and onto PlayStation, probably the biggest sea change move.
"So yeah, we weren't endemic, but I think we brought the entertainment piece in, which really helped accelerate the success of PlayStation."
He added that other non-endemics tried entering the video game market about 25 years ago like MGM, Fox and Sony Pictures.
"They all thought, 'we have IP, there's money in the games space, so let's make games," he said. "How hard can it be?' and then they all crashed and burned. And 20 years later you have all these big tech firms, they've got this cloud infrastructure, and they're like 'let's make games. How hard can it be?' and it turns out it's pretty hard."
A life-long and avid gamer, William D'Angelo was first introduced to VGChartz in 2007. After years of supporting the site, he was brought on in 2010 as a junior analyst, working his way up to lead analyst in 2012 and taking over the hardware estimates in 2017. He has expanded his involvement in the gaming community by producing content on his own YouTube channel and Twitch channel. You can contact the author on Twitter @TrunksWD.
More Articles
Tencent is also a big threat but ofc he's not gonna say that as a representative. These companies are not a threat as long as they don't do huge acquisitions. Every one is welcome to enter a market. According to him, both Sony and Microsoft should also be considered as threats since they were huge corporations barging into the video game industry. Especially with recent acquisitions, but I won't go there. I partially agree with him on his take on the movie industry and Netflix. Tho, he's completely wrong with the comparison to the music industry. The music industry struggled due to easy piracy and being able to listen them for free. For example, Youtube was filled with MP3 back in the day, but there are more extreme examples like Napster. You could say Apple and Spotify actually regained the worth of music sales. Videogames are not too far off, but it's hanging by the thread because it isn't as easy to pirate for the mass consumer. However, I do think F2P games filled with microtransaction ruined it instead.
I think his point was more than those mega corporations have the means, money and cloud based infrastructure to muscle in on the industry. He wouldn't say Tencent as, well they are already established and the market leader.
Apple and Google seem less included to force their way in just because of all the revenue they make from their mobile monopolies. Amazon seems the one to try something but outside of buying a few studios, they haven't tried much. Bet you, both Amazon and Google are kicking themselves letting MS buy Activision.
As a musician by myself I can say that Spotify is nothing more than a promotion platform for musicians, but not a place where you can earn something. Even if you're #1 in the charts and have millions of plays you earn almost nothing with Spotify.
To elaborate: Spotify pays 0.003€ per time a song is played. In other words, any Song must be played over 300 times to even just earn 1€. Makes Youtube almost look generous...
Yawn
I want all those companies to enter in the market. Better than have Microsoft as the only big player buying everything
This guy must be George Santos's brother.
AAA devs and their greed are the biggest threat to gaming.
The irony here about the whole "outsiders disrupting us" bit, is that when Sony dropped the PS1, they WERE the outsiders coming into the industry and blowing things up. They saw the money and went for it, just like everyone else doing right now.
Biggest threat to gaming is probably corporate greed, with Sony leading the pack. More big companies fighting for a piece of the gaming pie means more competition. Nintendo and Sony are way too established in the current market.
Your comment is just naive and out of date. You only talking about the console market? I get it, Sony and Nintendo are the face of gaming, it's easy to target them. In reality tho, Sony isn't leading the pack or anything, Apple, Google, Valve, Tencent, Microsoft, Netease, etc. All of these guys earn just as much, or even more from games. These companies are monopolies in some way shape or form. At least for consoles it's currently divided into 3, and isn't the majority of videogame market. The problem is more about how Tencent takes 70% commission fee, or Apple and Google are most likely talking behind the scenes to control the market (which is illegal), Windows holding 95% of operating system on PC gaming. Furthermore, these are more like passive income for these guys, while both Sony and Nintendo have to hustle and take huge risks comparably, making it their "active income"
PlayStation earned more from gaming than Tencent in 2022. I don't particularly care about mobile, but to an extent I don't see how Google/Apple act any different then let's say Steam or Playstation with their stores.
PlayStation is a massive player in gaming with a +20 billion revenue, which is over 1.5 times what Nintendo makes and still more than Microsoft gaming revenue with ABK included.
https://www.reddit.com/r/dataisbeautiful/comments/wjchus/oc_top_10_biggest_gaming_companies_by_their/
That's because Sony and Microsoft reports 100% of third party sales as revenue. In contrast, Nintendo only reports their portion of the third party sales. In reality, Sony's gaming revenue isn't as high as it seems. Mobile is the biggest market by far, even bigger than PC and console combined. So naturally mobile platform owners including Apple, Google, Tencent will be generating more than consoles and pc.
