This news. Sony's credit rating is at "junk" status and I've read other reports that's it's on the brink of going down even lower to a B. Right now I think they're a BB-, and B is worse. It goes something like

• AAA
• AA
• A
• BBB
• BB
• B
• etc

Anything above BBB is considered invest-worthy. Where you see a positive or a minus, that means it's gaining or dwindling. Basically, Sony is in a really bad spot financially and shit just got real. They are not considered to be a smart move for investing; one can only assume that this would urge people to not invest. The costs of producing another console might be their grave. Also, it's no secret that the Vita is not doing very well sales wise and hit it's all time low only this month. A shame because they look like great systems.

With that stuff out of the way, IF, and I say only IF, Sony pulls out of next gen, what will you do? Get a Wii U, Xbox, or nothing?

I would be pretty disappointed because I was planning on getting the next Sony console anyway, but not at launch. But I don't see how they can make this console competitive with the next Xbox and still not put them deeper and deeper into the hole. One of the main reasons I want them to survive is because niche Japanese games are not usually released on the Xbox, and the PS3 is where I get those games. But I suppose Wii U could fill that spot if the PS4 does not see the light of day... it's just not as powerful of a machine. That, or Xboxes will see a surge in sales in Japan, which I highly doubt. They'd pick Nintendo over Xbox. I'd just end up hoping the Wii U will take it's spot and get both systems, Xbox and Wii U.

(Just for comparison, I searched MS's rating and it's an AA+. Things are looking pretty good for them. Cannot find Nintendo.)

What would you do?

They must've already invested money into R&D; for the next console, and the Playstation division of the company is more successful than several other Sony divisions, so I imagine there are other markets they would drop out of well before video games,

I don't really know how business works, but aren't most companies in a similar situation and just waiting for a big break? I know that the BB- rating is preeettty bad, but it is Sony. I have to imagine they'll get money somehow to make the PS4 (well, I guess it's already made for the most part). But if the PS4 bombs... then that's a different story.

maybe they can borrow from Wonga.com. i hear they sort out those with a bad credit rating

Sony wont drop out (not likely) for one thing, if Sony does hit rock bottom the worse that will happen is that they'll file for bankruptcy and then restructure the company. PlayStations would still get made regardless if they're a profitable product.

That's the way business works, in America at least.

edit: Also, Sony's most profitable venture is its Financial arm, not its games division.

Sony Computer Entertainment (PlayStation) is doing pretty decently, it's other parts of Sony (the TV division in particular) that's dragging the company down. If worst comes to worst, PlayStation will get bought by someone else (Samsung?), though I'm hopeful it won't come to that.

yeah I just imagine they'll sell their less profitable businesses to some other company if worst comes to worst.

They won't drop out. Chances are though that the PS4 will only be a success in Japan, which will be enough for them.
 
(because Europe and North America want nothing but COD clones and sportsgames a year, going by the numbers)

A lot of Japanese companies made a ton of money during the rush to get HDTVs. What they're finding out now is like the last set of TVs once people find something they're comfortable with they're good. They'll probably have to downsize their TV division even more than they already have.

SCE is one of the more profitable divisions. They are more likely to stop making TVs first.

@SomeJerk said:

They won't drop out. Chances are though that the PS4 will only be a success in Japan, which will be enough for them. (because Europe and North America want nothing but COD clones and sportsgames a year, going by the numbers)

I'm in North America, and I resent this with all of my resentment.

Sony is failing mostly because the rest of their divisions, not because of the gaming division. If anything, they should split the company and be a little more conservative with hardware this coming generation. They can't take such a massive loss on the hardware.

Also, credit ratings are worse than middle school grading systems. An "A" is pretty much a bad credit score.

@LikeaSsur said:

@SomeJerk said:

They won't drop out. Chances are though that the PS4 will only be a success in Japan, which will be enough for them. (because Europe and North America want nothing but COD clones and sportsgames a year, going by the numbers)

I'm in North America, and I resent this with all of my resentment.

You may like other stuff, and I may like other stuff, but the numbers do show their statement to be true. Well, maybe more general shooters, not so much just CoD clones.

I have said this before Sony does not have the capacity to sell a new console next year (at least not one that is as powerful as people think is going to be, and at an affordable price) and probably not until the end of 2014 or maybe later. But like others have said their games division is the most profitable one, they just need to focus on PSN and convince the millions of PS3 user that there is value in that service, they need to continue to make really great games.

They wont skip the next gen but surely they we'll be the very last ones to join in.

It's extremely unlikely that they will get out now. It's not like they haven't been working on their next console for years at this point, and it's likely to make them a pile of money -- just what they need right now.

But if they exit, they exit. Life goes on. It would suck if Microsoft had no competition in the hardware business though. That would be bad for everyone.

I'm guessing I probably wouldn't buy a Sony gaming product.

Possible, but not likely.....

1) Junk bond status is not a death sentence. It just indicates that the company's debt has a higher than normal risk associated with it.

2) SCE is among the best, if not the best, of Sony's divisions in terms of profitability and performance. I haven't pulled the financial reports lately to lock this down, but as I recall their primary business for TVs, stereos, etc were all huge money pits. They'd be most prone to trying to preserve that department if they have to make real cuts, and it would be much more likely to survive through a corporate bankruptcy.

To answer your question though: if there is no PS4, I'll just do like I always do any way and buy up consoles and games on the cheap years later. I only bought a PS3 years ago because I read where they were removing the hardware backwards compatibility, but DMS / DKS would've forced my hand eventually anyways.

My guess is that Sony will split itself down into the good/profitable sides first before dropping out. It will keep its name on the areas that products still gain value with Sony on (video games are one of those areas).

Sony is going to get rid of all of its electronics (other than gaming) first; then it will get rid of movies. Then it will get rid of music. And only as a last resort will it move out of the video game business.

They're almost guarenteed to stay for another full console cycle (and my guess is by then the difference between console and PC gaming costs will be very minimal and so I find it unlikely even microsoft would stay in console gaming after that - only if the Kinect or some other left-field tech kicks off will it still be worth it for them).

I know that SCE is the most profitable, but from what I gather, these ratings don't take separate divisions into account. It's mostly the TV section of Sony that is failing, but because it's still Sony they all pile it under Sony Corp. Pretty stupid. But I thought that Playstation wasn't making a profit until a year or two ago? Can Sony really stand to wait 3-4 years for their console to start making profit?

I never really thought of another company buying out SCE though. That would make sense. Hopefully none of it will come to that.

@xyzygy: 'xyzygy' isn't how you spell Michael Pachter.

@RazielCuts: lol I know. I just don't want this to happen and wondered what others thought.

Sony won't be dropping out of consoles this generation. It's the biggest seller in their company, the entire company will have to end first before they give it up.

probably buy a ps3 finally. also I would probably go on an amazon spending spree buying up PS2 games I never played, for no particular reason, really.

Playstation is one of the few successful things that Sony can count on. If anything, expect them to invest even more in it.

Sony will fight to the bitter end. They'll give up their other projects first and try to maintain their gaming division. I don't see them dropping out anytime soon.

I have spare tinfoil hats, would anyone care for one?

@SomeJerk said:

They won't drop out. Chances are though that the PS4 will only be a success in Japan, which will be enough for them. (because Europe and North America want nothing but COD clones and sportsgames a year, going by the numbers)

Aside from the UK, Sony still dominates in Europe. Assuming they don't massively screw up with the PS4, they'll be in a good position to keep that lead.

@xyzygy said:

Can Sony really stand to wait 3-4 years for their console to start making profit?

I doubt they will have to. The PS3 was so expensive because Sony filled it with new, custom developed technology (Cell processor, Blu-Ray, etc.). With the Vita, they switched to using mostly existing mobile/tablet tech, and as such they're not losing much (if any) money on it. They'll likely be using a similar approach to the PS4, so they should be making money far sooner then with the PS3.

Well if Sony pulls out that is sort of good news for me as I will have one less console I have to consider buying. Though truthfully I don't think their games department is the reason they are in this deep a hole. I think it is more likely they will make a cut somewhere else than pull out of the console market.

If there's something that is going to make them money, it's their next console. R&D; is obviously already paid for and mostly done, so there's no point not putting that next console out.

That's a fucking terrible scale.

Sony is more than just their games division. If they're going down it's not because of their games division.

@VisariLoyalist said:

Sony is more than just their games division. If they're going down it's not because of their games division.

You do know the Ps3 put them into a lot of debt? And that the Vita is doing so hot right now?

What I do is, I put TV shows on a USB stick and put them in my ps3. Then at night I'll lie down in bed and watch those shows on my PsVita.

I payed a lot of money to be able to do that..

Sony won't stop making consoles until the bitter end. Why? It's one of their few profitable ventures right now. Failing compannies don't shut down the major things keeping them afloat.

Yeah in comparison to most of Sony's other failures of products their gaming division is doing pretty aight. Obviously not enough to keep the whole company above water but it'll be awhile before they die.

There games division is the only profitable division of the company. There is absolutely 0% chance they will give that up. If anything, Sony would just decided to become a game company.

Also, with the way generations have gone in the past, there's no reason why the next Microsoft console won't suck dick due to hubris and the next Sony console will catch them with something reasonable that consumers want.

Don't worry, they've got spiderman.

In all seriousness though, this proved pretty interesting.

http://factsanddetails.com/japan.php?itemid=918&catid=24&subcatid=157

A lot of sonys problems are credited due to mishandled CEO and flat out company style warfare. They've a pretty interesting history. I miss my walkman.

So Sony will nix the Playstation 4 and continue to make Sony Ericsson phones and Walkmen? If that's so, Sony is a fucking dumb company.

I doubt Sony is going to drop out of the gaming industry. I don't think they would leave their market share to be divided up by Nintendo and Microsoft. They have invested too much and with the success of the PS2, they have proven that they can do it right.

I'm not worried about it.

@Dalai said:

So Sony will nix the Playstation 4 and continue to make Sony Ericsson phones and Walkmen? If that's so, Sony is a fucking dumb company.

Why would Sony not want to continue being the 3rd largest smartphone maker in the world?

I'm curious if any of the people saying that SCE is the only division making money actually read that article that was linked to since it was primarily about the Playstation division. PS3 cost them a lot of money, and based on the numbers from that article, the Vita is tanking badly. They certainly won't be cancelling any PS4 development, but they will be way more cautious about how they handle things. I would think they would need a disastrous PS4 release in order for them to stop making consoles altogether

@DoctorWelch said:

There games division is the only profitable division of the company. There is absolutely 0% chance they will give that up. If anything, Sony would just decided to become a game company.

Also, with the way generations have gone in the past, there's no reason why the next Microsoft console won't suck dick due to hubris and the next Sony console will catch them with something reasonable that consumers want.

There is no reason to think that the next MS console will suck dick due to hubris. The PS2 destroyed everything. It put Sega out of the console business, and absolutely crushed what Nintendo and MS were offering. It is the best selling console ever. That was the source of their hubris. Microsoft has actually sold less total units of the 360 than PS3 according to their most recent financial reportings, albeit only by about 200k units. Yet both were soundly trounced by the Wii. What allowed MS to make those gains during this generation was that they fought for their market share and did everything imaginable to get as many people on board as they could. They were willing to spend money to get developers to work with them, and Sony just assumed everyone would bend to their whims. MS was very successful but they did not win anything. They have no reason to assume that they will dominate Sony next time around, and vice versa. I can only assume that next time it comes down to who is willing to spend the money to court developers for the next generation. It's worked to great success for MS, but who knows if Sony has that kind of room to throw money around given that Vita is under performing. But regardless of that, no one will ever make the kind of hardware mistake that Sony did with the PS3 ever again

@MildMolasses said:

There is no reason to think that the next MS console will suck dick due to hubris. The PS2 destroyed everything. It put Sega out of the console business, and absolutely crushed what Nintendo and MS were offering. It is the best selling console ever. That was the source of their hubris. Microsoft has actually sold less total units of the 360 than PS3 according to their most recent financial reportings, albeit only by about 200k units. Yet both were soundly trounced by the Wii. What allowed MS to make those gains during this generation was that they fought for their market share and did everything imaginable to get as many people on board as they could. They were willing to spend money to get developers to work with them, and Sony just assumed everyone would bend to their whims. MS was very successful but they did not win anything. They have no reason to assume that they will dominate Sony next time around, and vice versa. I can only assume that next time it comes down to who is willing to spend the money to court developers for the next generation. It's worked to great success for MS, but who knows if Sony has that kind of room to throw money around given that Vita is under performing. But regardless of that, no one will ever make the kind of hardware mistake that Sony did with the PS3 ever again

I meant to say, there's no reason why it couldn't happen, not that it's bound to happen. Strictly in the west, compare the Xbox and the PS2 at the end of that generation, and compare the 360 and PS3 now. It's kind of crazy what Sony let slip through their fingers and how they let Microsoft gain so much ground. Sony just got too confident in themselves.

Now, Microsoft is getting pretty cocky with its dashboard and it's seeming lack of care about games. I'm not saying they're gonna fuck the next console up, but if they don't make some of the obvious improvements there's definitely room for Sony to sweep back in and become the dominant console in Japan and the west.

So, anyway, the whole point is that there's no reason for Sony to do anything but put another console out.

Xbox should jump on Naughty Dog....Just saying.

Boy, I really wish Sony made better decisions with the launch of the PS3. They have some great things going on for them now on the platform, which hopefully gives them an advantages next generation, but it may be too little too late. Too early to tell obviously.

While I find it unlikely that Sony would get out of the gaming business since it's the only profitable division they have, It wouldn't really bother me.

@SomeJerk said:

They won't drop out. Chances are though that the PS4 will only be a success in Japan, which will be enough for them. (because Europe and North America want nothing but COD clones and sportsgames a year, going by the numbers)

LA Noire sold 5 million copies, and Skyrim sold something like 17 Million. Sure COD clones and sports games get high high numbers but there is tons of room for other things. It's all about quality. The Uncharted series has sold quite well for Sony, and seems to be a pretty solid system seller. I doubt they just do well in Japan. I'll end up owning all the consoles but I forsee a change of the guard next generation. Microsoft seems to be going in a more marketed/casual approach in terms of it's layout and is shown severe arrogance. Similar to the arrogance Sony showed after PS2 heading into PS3. Sony in this situation is as desperate as it gets. They are going to offer a shit ton of quality content, likely for free/good prices (look at what PS + has turned into) simply to get credibility and a consumer base. At which point they will likely start trying to build back the foundation of their company.

I aint no bidness man but from what I understand the Playstation devision is the only one pulling its weight right now. If anything they'd button up and focus on that more. I don't think they'll be dropping anything anytime soon though.

console manufacturers come and go. I will select the one with the best third party support that is most convenient for me as always. whether that be xbox or PC or some other new console from as yet unknown company, it doesn't matter. all i care about is the path of least resistance to the games I want to play.

I have no idea what I'm talking about, but wouldn't now be the time to buy Sony stock? Isn't there a chance Sony will bounce back?