PlayStation's Live-Service Initiative Could Not Have Gone Worse

Hello, One Take Schrier here. I really like the term live service initiative. Sony's live service initiative because it makes me think of the Avengers, except instead of Nick Fury going around and recruiting superheroes to team up and fight a great evil, it is Sony executives going around recruiting studios to burn through hundreds of millions of dollars and years of their lives. This morning, I reported on Bloomberg.com that Gorilla Games, the Amsterdam-based studio responsible for franchises like Killzone and Horizon, uh has rebooted Horizon Hunters: Gathering, the online live service game that was released earlier this year. And their plan, their kind of tentative plan, is to scope it down, to move a bunch of people off of it, to remove the live service elements, and turn it into more of a traditional co-op game. They have until the end of the year to kind of figure this out, and
[clears throat]
then there will be milestones and

reviews, and we'll see if it actually ever gets off the ground, or if it is quietly canceled. This happened because of negative playtest feedback the um the game had been getting uh playtests throughout this year. There was one, I believe, in February, another one in May, and in June, they looked at the scores, and they said, "This isn't working. We need to figure things out." And this week, they had a big meeting where they talked about what is happening, and moved some reassigned some people, and are kind of scrambling as they figure out what happens next. And this is just the latest example of a PlayStation studio failing to come up with a live service game, in large part because PlayStation has spent the last few years trying to fit their single-player focused studios into multiplayer games to very little success. So, let's start from the beginning, and I'm going to tell you the story of PlayStation's failed live service initiative. We won't go all the way to the beginning, but let's go to

the PS4 era, shall we? The PlayStation 4 comes out in 2013. It's fairly successful right out the gate, becomes one of the fastest launching got fastest selling consoles, I believe the fastest selling console, um despite the kind of sentiment in the air that came from analysts and pundits around the time that consoles were dead because of mobile gaming, the PlayStation 4 came out and kind of proved everybody wrong. And then it really did quite well over the next 7 years while it was the prime console on the market leading into the PS5. Um and it did quite well because Sony had this really cool big stable of high-quality exclusive games, many of which were nominated for game of the year or other awards, all of which got highly high critical acclaim and also commercial success. And that list includes Horizon Zero Dawn, which came out in 2017, and includes the God of War uh kind of reboot, which came out in 2018. It's almost like let's call that its own new franchise, God of War reboot franchise. Um there was Spider-Man,

which also came out in 2018, did extraordinarily well. There was Ghost of Tsushima, came out in 2020, did very well. Um we saw Uncharted 4 around that time, The Last of Us The Last of Us was technically a um technically a PS3 game is where that franchise launched, but I would say the PS4 era is really where it took off because that game came out in 2013 just a few months before the PS4, and so a lot of people wanted up playing the the PS4 version of it, and then of course the second game came out in 2020 towards the end of the PS4's lifespan. So we're talking about a generation that was just full of hits for Sony, and all of them were single-player narrative-focused games. A lot of people made fun of some of the similarities, open world, sad dads, etc., etc., but that is what they uh did. That is what did quite well for them. Um but something interesting happened, which is that Sony decided to pivot, and I think there are a bunch of reasons for this. Um, I made a video a few weeks ago called why everybody is chasing the the

live service games, why everyone wants the live service dragon, why people are obsessed with live why companies are obsessed with live service games. So, go check that out if you're curious about why this happens, but at a certain point Sony decided, "Hey, we are going to double down on live service." What is live service? Live service is essentially a game, usually online, but doesn't necessarily have to be online. But, essentially it is a game that is designed for recurring revenue. In other words, you put out the game, whether it's free-to-play or sold as a box product and you buy it, um, you put out a game and then it has some sort of recurring spend, some sort of monetization, some sort of microtransactions that are built in to get people to keep spending money on the game over time, over months, even years after it comes out. And this is they're designed in a way to support ongoing content, because the idea is we keep people playing and they will keep spending money on this thing. And there are all sorts of examples of live service games. There's the obvious big ones like the Fortnites and Robloxs of the world. Roblox is kind of a platform, so that's almost a different category, but let's say the Fortnites and I don't

know the Minecrafts of the world. Um, there's the, uh, kind of running online, almost MMO type live service games, World of Warcraft, Destiny. Um, there's also games that are just kind of traditionally sold, but then have ongoing microtransactions like NBA 2K or even Helldivers 2, which we'll get into in a sec. So, Sony went around and said, "Hey, we want to do this. We want to have the quote was, we want to have at least a dozen live service games shipping by, I believe they said it at the time this was like 2020 or 2021, they said by 2025 or 2026 we want to have a dozen live service games out and running." Um, this is because live service games make a lot of money when they're successful. Unfortunately, there's some downsides to this strategy. Live service games are very difficult to make, they are expensive to make, they sometimes fail to resonate with players, and some of them do, some of them players really enjoy, but a lot of them just fail to crack the market because it's very oversaturated market, and you're you're fighting for this player base that probably already has their favorite live service games. Um and uh most

importantly, it's really difficult for a studio that has kind of spent a decade building the know-how and pipelines and chemistry to make single-player games. It is really hard to suddenly have them turn on a dime and make a multiplayer game, especially a multiplayer live service game that requires this just kind of stream of ongoing content. And that is the most difficult part of making these games is that once you come out with them, you have to have this road map that is extremely intense and requires a lot of work and a lot of planning and a lot of time and a lot of money um to map out future content to get people continuously engaged with your game because it's a treadmill. Once you start it, it's launching isn't the end, launching is the beginning. You have to keep players engaged, otherwise you are not seeing the returns that you want to with one of these live service games. So, needless to say that initiative did not work out. Um I made a little list of just some of the live

service games that we've seen. Um this might not be all of them. I think there are some that maybe the world doesn't quite know about yet, but just even looking just going through this list, I think tells you a lot about how things have gone. So, I mentioned Horizon. So, Gorilla Games, they came out with Horizon Forbidden West in 2022. That was the sequel to Zero Dawn, and then rather than going on to a Horizon 3, most of the studio then went on to what would be called Horizon Hunter's Gathering, announced this year, and now rebooted as I reported today on Bloomberg. You can check out the story in the show notes. Um Horizon 3, by the way, uh they have a small team, I believe, working on it. They have some people, I don't know how many or what this the state of that is, but that that is a game that is years away if if it comes. Um there was a God of War live service game, which was an initiative done at Bluepoint, the studio that um was very well known for remastering and remaking old games. Um one of their biggest hits uh was Shadow of the Colossus, and then

they made a Demon's Souls remake in 2020 that came alongside the PS5 and was very well received. Um and uh after that they went on to help Sony Santa Monica, the maker of God of War, with God of War Ragnarok and spent a bunch of time working on that. And after the development of that game, they kicked off this project that was going to be an online multiplayer live service God of War game um involving Atreus in some way. You would like descend into Hades as Atreus. I don't remember all the specifics or exactly how it would work. Um uh but but essentially it was designed for many players, so I guess they could do their own kind of custom versions of Atreus or like aspects of Atreus. I'm not 100% sure how it would work. But that game did not pan out um because again, you have this problem of the studio that is really, really good at one thing, remastering games, um and doesn't have really a robust and experienced and um like uh it doesn't have a well-constructed design department because what it was doing was making games. So it was really good at art and tech, but it never really built up a design department. It

tried to do so over the years, um but even that I mean, building a design department and at the same time making one of these live service games is just playing everything on the hardest difficulty mode for um very little reason, very little return. So that did not work out. They tried to pitch a bunch of things. Eventually they were shuttered earlier this year. Very sad story. I also reported on Bloomberg earlier this year that they had tried to pitch the thing that everybody wanted from them. In fact, multiple times they tried to pitch the Bloodborne remake or remaster or whatever that would look like. Um Sony was interested. FromSoftware said no. Sony could ultimately, if they wanted, put their foot down and say, "Yes, we want to do this." But, uh but but ultimately, I think they they acquiesced to FromSoftware's wishes on that one. Um Insomniac Insomniac is Sony's most prolific studio, and they've somehow managed to dodge this curse by releasing several games, including Spider-Man 2 in 2023, big hit, and now Wolverine, which is coming next month, and we'll see how that does. Um so, they're one of the

studios that has actually avoided the curse of not releasing anything in the PS5 era. But, even they took a live service initiative. They they were visited by the Nick Fury of PlayStation, um doing a Spider-Man multiplayer game. It didn't get very far, and they didn't spend a ton of resources on it. They didn't put a ton of money or time into it, which is why they have been able to release uh multiple games this generation. But, still, they tried Spider-Man multiplayer. I think that sort of thing is always going to be hard to pull off any sort of kind of multiplayer superhero game, because if you play Spider-Man, you know that this is a game built around having a single superhero surrounded by thugs during combat, and translating that to multiplayer is very, very difficult. Um Naughty Dog, of course, spent a great deal of time and a ton of money, hundreds of millions, working on a Last of Us online project that was kind of their um it started off as a small thing, and they wanted to make it a bigger thing, and eventually it turned into a service game, and then they canceled it in 2023

for a variety of reasons. The reason they stated is one that I think is worth noting here, which is they said, "Hey, essentially, if we make this, and then it's a success, we're going to have to keep doing it and dedicate all these resources to it, and essentially become a live service studio." Which is the other curse of live service. Once you release a live service game, you cannot move on to the next thing. And a lot of companies wind up getting trapped in the live service game, and have to put aside or divert resources from their biggest projects. For example, Epic Games. I don't know if you remember this, but in 2017, before they released Fortnite, um uh Epic had a bunch of other games in the works. They used to be a company that made games all the time. Then they released Fortnite, kind of started off slowly, but then exploded once they added the Battle Royale mode to it at the end of 2017, and then shortly after that game just like skyrocketed in popularity and became a cultural phenomenon, they canceled their other games in order to put all of their resources on Fortnite. A similar thing

happened at Blizzard. I wrote about this in in my Blizzard book, Play Nice, but what happened was when World of Warcraft came out in 2004 and it was super popular, exploded way bigger than anyone expected, they had to kind of temporarily pause the other projects they were working on and just divert everybody into the World of Warcraft machine, cuz they needed to keep that going, and they were caught off guard by how much work it would take to continuously update that game because they had never done anything like it before. That's the danger of live service. So, Last of Us Online, that game was canceled. A lot of people at Naughty Dog were working on that game. I think there's a belief out there that it was just kind of a side project while most people were working on Intergalactic. No, the opposite is true. Intergalactic did not have the majority of staff until after Last of Us Online was canceled, and then most people in the studio came over to work on Intergalactic, but many people in the studio, I would say the majority of the studio was working on either Last of Us Online or the remasters, the remakes that they were doing, um throughout uh the 2020s, which is why we haven't seen a brand new game from them since 2020. Um Sony Bend. Sony Bend

is the Oregon-based studio behind Days Gone, and they, after Days Gone, had all sorts of issues, lost leadership, um uh we're trying to get a sequel off the ground that didn't happen. Eventually, they got to the point where they were working on this new IP that was also going to be a live service game until that was canceled at the same time as Bluepoint's was in 2025. Now, Bend is working on something else. They have fortunately been or are surviving and and have a chance to work on something else. I think we'll see that at some point in the next year or two. Um, hopefully it doesn't get canceled. Bungie, Sony bought Bungie in 2022 for 3.6 billion dollars and they bought Bungie in part because Bungie was a live service expert and they are Bungie at least portrayed itself as a live service expert and they thought that that expertise could be translated not only within Bungie but to their other projects. Um, and as part of that acquisition acquisition, Bungie also had

a whole bunch of other live service games in the works that Sony was wanted to see come out um, in the subsequent years. In addition to of course Destiny 2, which was Bungie's big ongoing project. But for a variety of reasons that I will get into in a story down the road, um, most of those projects fell apart. Uh, I believe there were five or six different projects that were happening. Some of them did come out. Destiny Rising, the mobile game came out, was not quite what um, what what people hoped it would be. Marathon came out earlier this year to underwhelming sales and uh, to this day the player count has just gone down and down. Unfortunately for Bungie, um, so that was not quite the live service success that they had hoped. And of course Destiny 2 itself was taken offline this year as Bungie laid off hundreds of staff along side that. So, that acquisition did not pay off the way that Sony hoped it would. There are some others. Um, there's Deviation, which was working on a shooter game. I'm actually I'm not sure. I I would take this back. I'm not 100% sure if this is a live

service game. Um, I don't remember. I've heard a little bit about it, but I don't remember if it was designed as a live service had some multiplayer for sure. It was made by college ex-Call of Duty people, um, but I don't remember if it was designed to be live service or something where like they would make it and then go on to a sequel right away. So, I'm not sure if this belongs on this list, but there are a few others. I mean, Twisted Metal, um, that uh, Firesprite was making. Um that was supposed to be a live service game before it was canceled in 2024. Fire Sprite then went on to work on Until Dawn 2, which is scheduled for next year. Um and then of course there are some games that came out. I mentioned Marathon, Concord. That's the big the big one, perhaps one of the biggest flops in video game history from Firewalk Studios, which Sony not only bought but put a whole lot of uh resources into hoping it would be a big thing. That game launched to such low demand that they pulled it from stores a couple weeks after it came out and has now become a symbol for all things wrong with live service games. Um there was

Helldivers 2, which was actually a big success from Arrowhead Studios. Um perhaps ironically, um uh Helldivers 2 is is the only game on this list that was made by a studio that is not part of PlayStation Studios, which maybe says a lot that their one big live service their biggest live service hit um was not actually part of the Sony Interactive Entertainment umbrella um but just kind of published and and funded by them. Um you can you could
[laughter]
make your own judgment on that one. Um MLB The Show, if you count that annual sports franchise, pretty successful live service in the sense that all these sports franchises are full of micro microtransactions and annualized and they're just designed for ongoing recurring revenue. Um maybe a couple others I'm forgetting. Uh feel free to comment if you think of any that I haven't listed here. Couple more still in the works, of course. Um Fair Games uh with a dollar sign, which has actually changed names. So I expect that it'll it'll look a little different next

time we see it. Um from Haven. Haven is a studio in Canada, in Montreal. It was founded by Jade Raymond, a long-time video game executive who actually left the studio um last year. Uh that game has been through a lot. Um I believe it was uh I I don't know if rebooted is is the right word, but certainly pivoted at some point recently like last year or so. I suspect we'll see it in a different form at some point unless it is canceled before then, which is very possible. That, if you don't remember, was announced a few years ago as kind of like this cooperative heist game where you're robbing rich people and and there's a dollar sign in the title. Gummy Bears, which was a game that was in incubation at Bungie and managed to save itself from the Bungie abattoir by going over to Sony and a new studio within Sony called Team LFG, kind of spun out from Bungie in 2024. Still in development. We'll see what happens with that one. That is a game that is They

describe it as a frog type game. Very curious to see what happens there. And yeah, man, I mean, it's hard to argue that this live service initiative has been a success for Sony. On the flip side, to play devil's advocate a little bit, what would have happened if all of these games all of these studios went on to release single-player games? Would they have found success? I think fans would have been happier certainly to see, say, a Horizon 3 or a new Naughty Dog game that came out a couple of years ago rather than maybe next year. Um so so I think fans would have appreciated that, but the expenses for these games, the budgets of these games have grown so high, have grown exponentially from uh the kind of 20 to 50 million-dollar range 15 years ago to the 200 to 500 million-dollar range today that I don't know how much commercial success Sony could actually find from a lot of these. Um

so it's it's really it's it's hard to know how things would have turned out if they hadn't pursued this live service initiative. That said, I mean, it's this this went about as poorly as it could have for Sony and PlayStation and Horizon. Today's news is just yet another example of that in action. All right, folks. I will see you all next time.