Sony to Look Into New Acquisitions After Buying Insomniac; PS Now Subscribers Substantially Increased, Now Over 1 Million
In the prepared remarks shared during their Q2 2020 earnings call, Sony updated investors on the main pillars of its gaming segment. To begin with, Senior Executive VP and CFO Hiroki Totoki revealed that the recent acquisition of Insomniac Games may be only the beginning as Sony will further look into strengthening its first-party content pipeline.
First, I will discuss our efforts to strengthen the first-party content and IP. On the IR day, we mentioned that Sony strength lies in first-party content and IP. With the aim of strengthening these, in August, we announced the acquisition of Insomniac Games, the game developer for Marvel's Spider-Man, which sold 13.2 million units worldwide. Through this acquisition, Insomniac Games will become SIE's 14th studio and will contribute to further enhancement of our first-party software development organization. Going forward, we will continue to pursue growth investment opportunities that will enhance our own content IP.
Totoki then briefly discussed the upcoming PlayStation 5 console, which was confirmed to be heading to retail stores in the Holiday season of 2020 as we had expected. According to the Sony executive, everything is going well and the new platform is set to provide new gameplay experiences that are going to appeal both to existing PlayStation 4 fans and brand new customers as well.
Lastly, Totoki talked about the increased focus on the PlayStation Now cloud gaming service. Apparently, the recent improvements made to PS Now (price reduction and the addition of high-profile PlayStation 4 games such as God of War) have resulted in a substantial increase in subscription numbers. The total number of subscribers is now over 1 million as of October 2019.
Thirdly, about our content distribution strategy. In 2014, Sony launched the pioneering cloud gaming subscription service, PlayStation Now. And to further strengthen the content distribution strategy, we announced a renewal of the service this month. PS Now has become even more attractive due to global strategic price reduction and the addition of limited-time-only popular game titles such as God of War. Since starting this, the service renewal, subscribers substantially increased and the total number of subscribers has already exceeded 1 million as of this month. This is a great step toward a target we mentioned on the IR Day of growing subscribers by an average of more than 50% per year. Through this renewal, we are aiming to assess the potential of cloud gaming services. The impact of the renewal on the results of this fiscal year is expected to be minimal.
Credits for the transcriptions go to Seeking Alpha.