PSN Collapse Is Microsoft's Gain
The PlayStation Network crisis has raised important questions about the future of digital, and presented Microsoft a gilt-edged opportunity to pull even further ahead in the console race…
Don’t let the relentless flow of stories fool you, journalists covering the games industry have a torrid time of things. The average major website publishes at least one story every hour, but these are generally comprised of release dates, sales figures, details of forthcoming releases, and other information carefully rationed by those involved.
Genuinely newsworthy incidents are few and far between, and the recent attack on the PlayStation Network and subsequent outage is in a class of its own. Forget West, Zampella and Activision; this is news so big that it made the U.S. Congress and the Attorney General of New York sit up and listen.
Needless to say, the press – both within the games industry and without – devoured the story, examining its every angle, picking it apart, and getting very carried away in the process. To give you an idea, Forbes presented information gathered by data-security research firm The Ponoma Institute that put the cost of the breach to Sony at $24 billion.
We tend to side with Michael Pachter’s more reserved estimate of $10 million, but the fact that such a farcically distended figure can become so widely reported is a good indication of the pervasive atmosphere of sensationalism. At least one lawsuit has been filed. No doubt more are to follow. Articles calling for the head of Sony CEO Howard Stringer have also started to emerge, and for the most part these actions and opinions emanate from people whose understanding of hacking, security measures and cyber-crime in general is certainly up for debate.
360 magazine will go as far as to say that Sony’s response to the breach could perhaps have been better, but the company has tacitly acknowledged that much by pledging to cover the costs of any resulting incidents of identity theft, and has introduced a ‘welcome back’ scheme that will see every PSN user receive a relatively generous bundle of free content.
In an official video, Sony’s Kaz Hirai insisted that the company is “extensively and aggressively testing our enhanced security measures,” and we have no reason to doubt his statement. Every PlayStation 3 owner had a very good reason to complain, but, the inconvenience of not being able to play online for a month aside, the fears that gave rise to those complaints have largely been addressed. As far as the consumer is concerned, it happened, it was bad, but it’s over now.
At least, that’s the message Sony is now sending, but the ramifications of the breach extend far beyond consumer confidence. The amount of money involved in buying a console and games makes the idea that anyone not materially affected by the data theft turning their backs on Sony forever difficult to swallow. Unless another, identical crisis occurs in the near future, any hesitance one might have over using the PSN will quickly fade.
More important is the impact on third-party companies, and it is here that Microsoft could turn Sony’s perfect storm of misfortune and incompetence to its own advantage. Consider Ubisoft’s wonderful Outland, released shortly after the PSN went down, its potential audience effectively cut in half. Consider how Bethesda’s Brink (a game barely worth playing offline), will be a far less attractive purchase for any PlayStation owner. Consider Portal 2, the PlayStation 3 version of which Valve has very publicly declared to be definitive – any Xbox 360 owners enjoying the game’s excellent online co-op in the last month might just disagree.
None of these companies are going to abandon their support of Sony, but if Microsoft was to call Gabe Newell about Steamworks support for Xbox Live, he might be more inclined to listen now. If Microsoft wanted exclusive DLC for Skyrim, the terms might not have to be quite so generous. If Microsoft was shopping around for games for next year’s Summer Of Arcade, a company like Ubisoft might need less persuading to concentrate on Xbox Live. An opportunity, if Microsoft chose to leverage its position.
Smaller companies are more volatile still. The ‘hundreds of thousands, if not millions’ Capcom claims to have lost can be swallowed by a company of that size, but independent studios don’t have that luxury. Q-Games’ Dylan Cuthbert told Industry Gamers that, “PSN being out definitely affects our bottom line,” and when the head of the studio behind the excellent PixelJunk series expresses dissatisfaction, it is only sensible for Microsoft to pay attention – and possibly reach for the cheque book.
Numerous industry figures have voiced their concerns that the breach will slow the transition into digital for the entire industry. “Not just PSN, but also XBLA, Steam, iTunes – all of the digital content providers,” James Brooksby of Doublesix Games told GamesIndustry.biz. “This has been a very widely publicised problem that consumers will take note of next time they create accounts and buy online games.”
This is perhaps overstating the case. Ultimately, customers who use iTunes and Amazon won’t lose faith in them due to mistakes made by another company, but they will certainly be asking questions of Sony. E3 is the ideal venue for Howard Stringer, Kaz Hirai and, in all likelihood, Kevin Butler to answer those questions, and if Microsoft is smart, it will adapt its own presentation to include a substantial segment about just how awesome Xbox Live is, and the many ways it will become better over the coming year.
At this point in the generation, Xbox Live and all it entails is arguably the best reason to buy an Xbox 360, assuming that no similar breach occurs to Microsoft’s service. There will be no need for tactless, on-the-nose boasting. Sony’s position will be weakened by mere association.