Sony or Microsoft: Who will be the real winner of the partnership?

Last week, we learnt that Sony and Microsoft will be teaming up to develop new technologies in the field of gaming and game streaming. Sony, which owns the PlayStation consoles, partnered with its long-time rival Microsoft which owns the Xbox gaming consoles. The move was a highly unexpected one by the companies. But according to Sony, it has partnered with Microsoft to host some of its PlayStation online services to Microsoft’s Azure cloud platform.

Sony too has been trying to develop its own cloud platform with limited success and now it partners with Microsoft to use the Azure cloud platform. But according to a report by Bloomberg, the employees working on the PlayStation were outraged with Sony’s partnership with Microsoft as they were unaware of this development. But the higher-ups had promised that the upcoming consoles of the future won’t be affected with this partnership.

Sony’s PlayStation generates about a third of the company’s profits and faces stiff competition from Microsoft’s Xbox. In the new age of gaming, cloud platforms play a huge role in the gaming consoles and their parent companies. Seeing this opportunity, Google and Amazon.com Inc, both of which have their own cloud platforms and servers they are developing cloud-gaming services as well. Google Stadia is an example of such a service. Sony could be in serious trouble with its PlayStation platform as it doesn’t own a solid cloud platform. That’s another reason for the partnership between the two rival gaming console makers.

The report further states that, according to industry veterans and analysts, Sony is feeling ‘threatened’ with this new trend in gaming. And with Google entering the gaming business, this threat has skyrocketed for Sony. This is said to be another reason why the Japanese company has decided to leave its network infrastructure build-up to Microsoft. And following the team up with Microsoft, Sony’s shared jumped 9.9% on Friday which is the highest in the past 18 months.

In 2020, Sony bought the US start-up Gaikai Inc. to enter cloud-based gaming and then it launched the PlayStation. But now, its services have become very limited. And in the race where each company and console is trying to outdo the other and bring a new system, Sony could have lost the war in the long run if it didn’t partner with Microsoft.

According to some industry veterans, Sony could be the winner in the short to medium term run with this partnership. But Microsoft will be taking the bigger prize home as Sony had to depend on Microsoft’s Azure for its survival. Microsoft has been constantly trying to better its own Xbox consoles and services. And with Amazon and Google entering the playing field, the gaming sector will see a huge war of the top technology companies of the world.