The PS4 stumbles

The PS4 has ridden a wave of goodwill since its launch a year ago. Its “games first” PR, strong indie support and hardware have translated into a strong console lead. But lately Sony has faltered. There’s been a lack of feedback to users, until recently a lack of UI updates, and Driveclub, one of Sony’s only holiday PS4 exclusives, has had a disastrous release. Meanwhile, Microsoft is going all in this holiday with aggressive price drops, game bundles, and well reviewed exclusives. It’s time for Sony to shake up its approach.

Problem: Losing on AAA exclusives

Lukewarm reviews withstanding, Driveclub is an accessible racer that shows off the PS4’s graphical performance. Its promised free-to-play PS+ version had potential to gain significant word of mouth among millions of PS4 subscribers with little advertising. But even a month since Driveclub was on sale, its online performance is spotty if not unplayable. The PS+ edition is delayed “until further notice.”

Contrast that with Microsoft. By raw numbers, the Xbox One’s AAA exclusives are limited in number, but reviewed well and appeal to a wide scope of popular AAA genres: racing (Forza Horizon 2), shooting (Halo: The Master Chief Collection), and third-person action/adventure (Sunset Overdrive). For holiday buyers deciding between the Xbox One and PS4, Microsoft has a clear advantage on first party titles. Games, more than any other factor, move consoles.

Response: Tote indies and variety

A lack of first party exclusives does not equate with a lack of games; Sony is lucky that after a slow summer we’ve seen big third party releases that cover almost every traditional genre. November has releases from already popular franchises (Call of Duty, Far Cry) and interesting new IPs (The Crew). Marquee sports releases (NBA 2K15) and massively hyped MMO-like shooters (Destiny) launched earlier this fall. So it’s no surprise that Sony has stuck to marketing these titles.

But Sony rarely advertises the PS4’s indie offerings where they have a huge advantage over Xbox on quality and quantity. Granted, many indies have content that’s hard to market as “next gen” to consumers, especially when said offerings are available on PC, the PS3 or Vita. But by leaning on indies, Sony can tout a larger, more diverse game package than Microsoft. And indies do more than bump release counts; many have gorgeous, unique art direction and genres that don’t align with traditional action/shooter/sports AAA franchises. That uniqueness can appeal to a growing market that doesn’t fit into a “core gamer” demographic. Resogun, Transistor and Velocity 2X are all strong examples.

Problem: More expensive price

A PS4 that sells for $100 cheaper than an Xbox One has been a key factor in its success. There’s a compelling narrative at play: pay less for a more powerful, straightforward device that can make the third party titles that dominate 2014 look slightly better. Even when Microsoft matched the PS4’s price by unbundling the Kinect this year, Sony’s momentum was still strong enough for it to outpace Xbox One sales every month. But this holiday season, Microsoft is out for blood: there’s several Xbox bundles widely available for $50 less than the console-only PS4.

Solution: Bundle a quality AAA game

A PS4 price match is unnecessary, even unwise given Sony’s weak financial shape. But there’s more than pricing at stake, it’s Microsoft including either Sunset Overdrive, Assassin’s Creed, Call of Duty or Forza – the final three with big brand awareness – in the box. That’s too much of a differential for Sony to ignore; they should respond with a strong game bundle at the $400 base price. An obvious option would be a well praised first party title like The Last of Us: Remastered. Sony could alternatively make a more aggressive (and more expensive) move by bundling in a hyped new third party release like Destiny or GTA V.

Extras: Play up 2015, tout the hardware advantage

As noted earlier, Microsoft has a clear advantage regarding big releases this holiday. But for now Sony’s got a more interesting first party offering for early 2015. RPG/action Bloodborne and The Order: 1886 are released in February. Later in the year we’ll see cult PC hit Day Z, Let it Die and No Man’s Sky. There’s console-exclusive indie titles too: Hotline Miami 2, The Witness, and potentially Helldivers and Galak-Z if their release dates are bumped past 2014.

It’s also time for Sony to directly market their superior hardware. For the past year we’ve seen better graphics on the PS4 over the Xbox One on third party titles, usually in the form of higher resolutions or otherwise enhanced texture details. Granted, small graphical differences rarely affect a game’s quality. And like we’ve seen in a debates on other platforms – Blu-ray versus Netflix streams, vinyl versus low-bit Pandora mp3s – many won’t notice or care about the difference. Yet if a potential console buyer finds the exclusives and interface on either side a wash, better graphics on the PS4 can be a weighing factor.

Overall, I’m not expecting a bloodbath by either side this holiday. Microsoft will likely beat Sony in U.S. sales, but that’s a short term win which Sony can recover from given it’s large overall lead. Yet console battles are about momentum and perception. Without any action by Sony this holiday, combined with some recent stumbles, Sony might be forced to take actions in 2015 from a position of weakness, not strength.