PlayStation ‘had to calm workers’ over Microsoft cloud deal

Deal reportedly brokered “largely without the involvement of the PlayStation unit”

PlayStation employees were reportedly caught off-guard by Sony’s agreement to partner with Microsoft on the development of cloud gaming technology.

Last week, Microsoft and Sony announced a strategic partnership that’s expected to result in the PlayStation maker using Microsoft Azure data centres for cloud gaming and content streaming services.

Sony told Bloomberg that negotiations between the two companies began last year, but knowledge of the talks appears to have been tightly restricted until last week.

According to the site’s sources, negotiations “were handled directly by Sony’s senior management in Tokyo, largely without the involvement of the PlayStation unit”.

The report adds: “Staff at the gaming division were caught off-guard by the news. Managers had to calm workers and assure them that plans for the company’s next-generation console weren’t affected”.

The surprise announcement followed Google’s unveiling of cloud gaming platform Stadia in March. The project, which is being led by former PlayStation and Xbox executive Phil Harrison, is set to launch later this year.

Game streaming is also said to be a key part of Microsoft’s plans for the next Xbox console, with the company set to launch public trials for its in-development Project xCloud tech later this year.

Speaking to Bloomberg, several analysts said Microsoft would be the main beneficiary of the deal with Sony should cloud gaming take off.

DFC Intelligence CEO David Cole said Sony’s own game streaming service PlayStation Now, which has some 700,000 subscribers, “has been a very limited service”.

“Microsoft is the clear winner that Sony picked their technology even though they are a direct competitor in the gaming space,” he asserted.

Asymmetric Advisors strategist Amir Anvarzadeh also said: “Why would they sleep with the enemy unless they feel threatened?” He added: “This move raises some serious questions about its future dominance.”