How Microsoft and Sony Plan to Generate More Revenue

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Microsoft

Millions of people around the world like to play video games. Interestingly, Microsoft and Sony both released new video game consoles several days ago. Importantly, it offers $500 Xbox Series X and $300 Series S. Its rival Sony has two models of Playstation 5, starting at $400.

As a reminder, the last generation of consoles released by both lasted about seven years. It is worth mentioning that Microsoft and Sony are employing different strategies when it comes to attracting gamers and generating even more revenue from gamers.

People all over the world started to spend more time at home due to the coronavirus pandemic. Notably, gamers could stay hooked for years to come, and companies want to take advantage of this opportunity. It is worth noting that gaming represents 24% of Sony’s revenue. However, in the case of Microsoft, it accounts for 8% of the company’s revenue.

As mentioned earlier, bot companies introduced the previous generation of consoles in 2013. Interestingly, Sony shipped 4.2 million new consoles and Microsoft shipped 3.8 million. People should take into account that, each year the PlayStation 4 outsold Xbox One.

Sony, Microsoft, and different strategies

Companies are working to generate more revenue, but they are using different strategies. For example, Microsoft is more focused on racking up Game Pass subscribers than moving consoles, unlike Sony.

It is worth mentioning that, Xbox Game Pass, is an online subscription service that gives customers a catalog of more than 100 games. It is possible to use this service for as little as $10 a month. Moreover, the company plans to bolster the service with new titles over time, just as Netflix does with video.

Furthermore, Microsoft’s offering is broader than Sony’s new PlayStation Plus Collection. Sony’s service offers 20 Playstation 4 games people can play if they subscribe to the PlayStation Plus online multiplayer service, which costs $5 per month.

Interestingly, Game Pass subscribers who pay an additional $5 per month get access to a service for playing Xbox games on Android devices. Notably, the games are delivered over the internet from Microsoft data centers. Moreover, Microsoft also wants to provide a similar service for the iOS device, but due to Apple’s App Store policies, the company is unable to offer this service to iOS users.

Importantly, the mobile option represents an answer of sorts to the Nintendo Switch. As a reminder, Nintendo Switch offers powerful gameplay in a portable design. However, Sony’s PlayStation Now cloud gaming service does not support mobile devices.

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