One of the points my PS3 fanboy friends are always bringing up about their system is the fact that its internet service, Playstation Network (PSN) is free to access and free to play, unlike Xbox Live, which until a recent redesign, required a $50 wireless adapter, and has always mandated a $50 (just increased to $60) a year subscription fee to access.
And the fact is, they’re right, it’s a HUGE benefit for the PS3, one that few people realize actually offsets the difference in price. Yes, generally the PS3 has cost $50-100 more than the Xbox 360 in the years since it’s release, but if you own the system for a decent while, you’re actually saving quite a bit of money, as annual Xbox Live costs can climb into the hundreds of dollars over time.
But such generosity comes at a cost. PSN has lost money for Sony thus far, and only now is looking to move into the black. As there are no subscription costs, money is made from the online content sold through the service, which can be substantial, but obviously pales in comparison to 40 million Xbox Live subscribers handing $60 to Microsoft without question every single year. And with everyone’s account set to auto-renew by default (a setting that’s notoriously difficult to change), many do so without even realizing it.
Sony Computer Entertainment President Kaz Hirai recently spoke to Reuters Japan about the current state of the PSN, and he’s optimistic about the future of the service.
According to the report, PSN sales during the 2009 fiscal year added up to 36 billion yen (approx. $434.3 million USD). That number “nearly doubled” in 2010. However, Hirai said “we’re aiming to enter the black during the 2011 fiscal year.” Furthermore, he projected that PSN sales would reach 300 billion yen ($3.6 billion) in the 2012 fiscal year. He cited the number of registered PSN accounts (60 million as of November) as evidence of the service’s growth.
These are impressive numbers, and that does mean there are more PSN accounts than Xbox Live subscribers, but again, without those subscription fees, Xbox is way ahead in terms of cash flow, with its unreactive userbase who doesn’t particularly care about paying for a service that is free on their competitor’s system. You would think free online play would have spurred PS3 outsell the 360, but buyers could never get past the initial price being higher, and die-hard fans of exclusive Microsoft franchises like Halo would never jump ship.
But as PSN moves into the black, and Microsoft continues to aggravate customers with rate hikes and confusing cancellation policies, things might be tipping Sony’s way in the online gaming game.