Sony Will Spend $2.1 Billion On Gaming Research & Development Through March 2024

Sony plans large investments into gaming research and development, aiming to increase R&D spending to 300 billion Yen or 2.1 billion dollars this fiscal year, according to Nikkei. This is a 3% increase from last year’s investments in gaming research and more than double the amount spent on gaming R&D by Sony in 2020, when the PS5 came out. 

A big part of Sony’s plans to increase R&D include investments in live service content, subscription services, and virtual reality. Although they are the market leader in console gaming, Sony still lags behind Microsoft and 3rd party publishers within live service content. They also do not have an exact equivalent to rival Microsoft’s Xbox Game Pass subscription service. 

According to Nikkei, Sony plans to pivot from focusing on hardware for revenue to focusing on a subscription-based business model, likely in a bid to compete with Game Pass and other cloud streaming providers. Sony currently offers its PlayStation Plus Premium and Extra services, which are still somewhat limited compared to Gamepass, which has first-party games on day one.

Sony has roughly 12 first-party live service games in development to be released by fiscal year 2026. PlayStation’s strength has always been in its single-player exclusive games like God of War and Spiderman, however multiplayer and live service titles can increase recurring revenue for the company. This year Sony will allocate 55% of its PlayStation R&D budget to live-service development. 

VR gaming and the Metaverse are a major focus of Sony, whose PSVR and PSVR 2 headsets are among the most popular gaming headsets, and whose large library of exclusive content makes the PSVR an attractive headset for consumers.