Playstation and the Power of Unexpected Consequences

Abstract

It has been suggested that research business strategy is like studying specimens on a wall. By examining successful stories, one can easily identify the strategic factors responsible for such a success, and the greater the success, the more evident those factors are. Timing, strategic positioning, pricing policies, lead-time – everything goes back to the place where it fits best, like a beautiful mosaic. Even competitors' mistakes become more evident, their dull misunderstanding of what the winner was planning as every successful move leads to an even more successful one. The case of Sony PlayStation, the most successful digital games console ever, is no exception and the temptation to explain the rationale behind such an achievement is almost irresistible. As this paper tries to suggest, sometimes ex- post rationalizations hide or avoid part of the truth. Despite PlayStation's success, Sony's strategic choices were, on more than one occasion, driven more by lucky coincidence than by long-range planning. Furthermore, this paper shows how some of the strategic factors behind PlayStation's winning run sprang from decisions taken by lack of alternatives, and that only in the very end was Sony able to understand their full profit potential.

Keywords:

• Video-game industry
• strategic change
• deliberate vs emergent strategy
• reception
• celebrity