Sony Bets Big On E3: String Of Launches For PS4, PS4VR

It seems Sony Corporation’s (NYSE:SNE) line of game launches at Electronic Entertainment Expo (“E3”), a video game conference being held at Los Angeles, will create ripples across the gaming cosmos for quite some time.

Sony’s gaming division, Sony Interactive Entertainment America LLC (“SIEA”), came up with an attractive line-up for PS4 including Days Gone, Spider-Man, LEGO Star Wars: The Force Awakens, God of War, Death Stranding, Final Fantasy XV, Resident Evil 7 biohazard. The company has also managed to steal the thunder from chief rival Facebook, Inc.’s (NASDAQ:FB) Virtual Reality (“VR”) set by announcing a series of VR games for its upcoming PSVR headset in October, carving a comfortable spot for itself in the incipient VR games market.

Scores Big with Sony Fans

What Olympic is to athletes, Electronic Entertainment Expo (“E3”) is to video game makers that are vying to carve out a niche for themselves in the video game console market. Sony kept it short at the demonstrations on stage, enthralling fans with the presentation of one game after other. Three of the SIEA’s games, namely, God of War, Spider-Man and Days Gone were out-and-out crowd-pleasers.

Sony is largely banking on its PS4 customer base of 40 million for increased traction of its new games. While Bear McCreary’s soaring live background score, that introduced God of War, set the mood, the compelling story lines of Spider-Man and Days Gone entranced the viewers. The other showcases included Horizon Zero Dawn, Detroit: Become Human and The Last Guardian, which are scheduled for launch on Oct 25, 2016.

SIEA Collaborations

SIEA in collaboration with Activision brought back the popular animated character Crash Bandicoot that will appear in Skylanders Imaginators in October. In 2017, the company’s tie-up with video game makers Activision and Vicarious Visions will help in bringing Crash 1, Crash 2 and Crash Warped for PS4.

Also, SIEA’s partnership with Activision on another game Call of Duty: Infinite Warfare is well on track. Gamers interested in pre-ordering it will be given a chosen edition of the game 30 days ahead of its official launch in November.

PSVR Headsets: Future-Forward

Back in March, Sony managed to thwart competition from rivals like Facebook and HTC by deferring the launch of its VR headset from June to October and pricing it lower than its peers’ offerings. Meanwhile, the company has adopted a few initiatives to rake in higher profits.

The company plans to launch almost 50 games for this VR headset which will lend a competitive edge over peers. A host of exclusive titles have been engineered for PSVR users as well. Cashing in on the hit superhero franchise formula, SIEA is on track to launch Batman: Arkham VR on PSVR. Other high-end additions would include Farpoint and Star Wars Battlefront: X-Wing VR Mission.

Money Matters

Sony resorted to a competitive pricing strategy to beat rivals and help stoke demand for its VR headsets which are scheduled to debut on Oct 13, 2016. Sony’s VR headsets are priced at a comfortable $399 compared with Facebook’s $599 and HTC Vive’s $799. At E3, the company confirmed PlayStation VR titles will be priced within $9.99 to $59.99.

Also, the company has priced its motion-sensing camera device for VR headset at just $60 and some games which will require PlayStation Move controllers have been priced as a two-pack bundle at $99.99. The company is relentlessly pursuing avenues to broaden mass appeal in contrast to Oculus Rift and HTC Vive which caters to consumers with bottomless purses.

Other Businesses Weak

The profits garnered from PS4 sales may fail to rescue Sony’s overall business which has been recently facing pressure owing to weaknesses in multiple business lines. For instance, softness in mobile and sensor businesses is expected to undermine its financials in the near term.

Also, stiff rivalry in each of its product lines including television, game platform, smartphone and services, along with weakness in the cameras business and no immediate rebound in the image sensor segment add to the company’s challenges. In addition, launch of Microsoft Corp.’s (NASDAQ:MSFT) Project Scorpio, a slicker version of the Xbox, may intensify competition for Sony’s upcoming Project Neo.

Owing to these adverse factors, Sony currently has a Zacks Rank #5 (Strong Sell). A better-ranked stock in the industry is Dolby Laboratories, Inc. (NYSE:DLB) with a Zacks Rank #1 (Strong Buy).