Sony Interactive Entertainment’s PlayStation Portal, a portable gaming device that streams PS5 games, was fully unveiled at Gamescom. While the PlayStation Portal is designed to attract and retain the most valuable PS5 owners, as Nintendo prepares the next-gen hardware, many questions remain regarding its appeal to consumers.
PlayStation Portal sees Sony’s handheld gaming strategy shift from dedicated platform to peripheral
At first glance, the PlayStation Portal may look like a dedicated gaming device built for its own games, such as the Nintendo Switch or Steam Deck, but it’s actually a handheld streaming device. Requires a PlayStation 5 console and software, as well as a Wi-Fi connection to interact between the two.
This marks a clear departure for Sony, which previously produced handhelds as stand-alone platforms serviced by dedicated software libraries. Its latest handheld platform, the PlayStation Vita, has fallen well short of expectations, with Omdia estimating sales of just 14.1 million units, or just under a fifth (19%) of the previous generation PlayStation Portable’s 76.2 million.
Since then, Sony has found success by focusing on one platform, the latest being the PlayStation 5. As such, the PlayStation Portal is very much a peripheral designed to augment the PS5 ecosystem, rather than existing alongside it or competing with it. to her
The PlayStation Portal promises to open up more flexibility for PS5 owners to enjoy games with a focus on off-TV streaming. This is something Sony will no doubt hope will increase engagement with the console (and drive further software purchases), much like Valve’s Steam Deck is an extension of the Steam distribution platform for PC.
Its industrial-style DualSense design is no coincidence, as it provides sales opportunities for the PS5’s high-end DualSense Edge ($199.99) and DualSense ($69.99) controllers, as the portal replicates some of their key features.
What’s more, the lack of Bluetooth functionality on the PlayStation Portal encourages consumers to purchase additional peripherals—specifically, wireless audio headsets compatible with Sony’s own PS Link wireless standard. These include the PULSE Explore in-ear headphones ($199.99) and the PULSE Elite headset ($149.99), also launched with PlayStation Portal.
The value of the PlayStation Portal lies in its ability to contain the most valuable PS5 players
More pertinently, however, is that PlayStation Portal does not support the PlayStation Plus Premium cloud streaming service. It’s probably by design. By claiming ownership of PS5 hardware and software, PlayStation Portal is not cannibalizing its PS4 and PS5 software business; the customer has already invested in PS5 by regularly purchasing full games at retail or the PS Store. A cloud-only customer will not generate any content costs.
Also, consider the price: $199.99 puts the PlayStation Portal within striking distance of Nintendo’s Switch Lite, which launched at the same price in late 2019. Omdia expects Nintendo’s next-gen system to launch in 2024, following the arrival of PlayStation Portal in late 2023.
In 2023, PS5 sales increased significantly compared to last year, thanks in part to the recovery of supplies in previously underserved territories such as Western Europe. According to Omdia’s previous console forecasts, active PS5 installations will exceed 50 million units by the end of 2023.
With PlayStation Portal providing the opportunity to at least somewhat replicate the handheld USP of the Nintendo Switch, Sony hopes to keep the wallet and attention of that audience on PlayStation as the cross-system property grows in what is a very mature market segment.
Indeed, the April 2023 Omdia Consumer Research Survey shows that globally, more than one in three PS5 owners already own a Nintendo Switch. This share is even higher in the US, the territory with the largest active installed base of PS5 consoles.
Also look out for Valve’s Steam Deck. Although it plays games on the device, it, like PlayStation Portal for PS5, is an extension of Valve’s Steam ecosystem for PC gaming. Related devices like PlayStation Portal don’t necessarily need to sell in console volumes to be worthwhile; the goal is to increase engagement with the existing ecosystem – in this case the PlayStation 5.
Figure 1: Estimated Annual Steam Deck Sales (All Models)
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Sony still has a lot to prove with PlayStation Portal
However, there are key signs that Sony still has a lot of work to do to convince its eager PS5 audience to embrace PlayStation Portal. First, Sony already offers PlayStation 5 remote play on smart devices and PCs. Because of this, it needs to convince users that the PlayStation Portal provides a PS5 streaming experience that is far superior to the devices its audience already owns.
While the PlayStation Portal is an all-in-one device, making it more streamlined than these alternatives, there are still a number of obstacles that reduce the appeal of the device at its $199.99 asking price.
Most notable is the reliance on connecting to the PS5 via the user’s own Wi-Fi connection, which is already in use via remote play on existing devices. Not only does this significantly limit indoor use—a missed opportunity, given that the Switch and Steam Deck remove those restrictions—but the latency (the time between pressing a button and the action being displayed on screen) becomes dependent on the quality of the local Wi-Fi connection being used.
The concept was implemented more elegantly more than 10 years ago. When Nintendo tried a similar streaming approach to off-TV gaming with its ill-fated Wii U console, it created a custom communication protocol between the Wii U GamePad and the console to avoid the pitfalls of using local Wi-Fi. The result is a stronger connection with lower latency than many TVs.
Sony could have developed a similar solution with the PlayStation Portal, using a direct connection to the PS5 console itself via an included dongle that plugs into a 10Gbps USB port. It already does this with the PULSE 3D wireless headset to avoid the lag associated with Bluetooth connectivity.
In light of all this, PlayStation Portal may not have much success to justify its existence. It’s positioned and billed as a peripheral, with a price point that puts it on par with the US$199.99 DualSense Edge controller, indicating its status as a high-end app aimed at the most enthusiast audience.
As a result, Sony will not provide the same sales forecasts on the PlayStation Portal as they do on the PlayStation Vita. It would be wise not to – Sony’s previous PDAs were stand-alone gaming platforms that required much higher R&D and operating costs. PlayStation Portal may not lure a significant number of PS5 owners away from the Switch or Steam Deck with its promise of off-TV play, but if it resonates with Sony’s most engaged users, the company’s experiment will be deemed a success.
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Additional reading
Consumer Research – Visualizing Gamers (June 2023)
Game equipment database (May 2023)
Console Report – 1H23 (May 2023)
Steam Deck Forecast Report (April 2023)
Costs for game content and services by database type (March 2023)
The author
James McWhirter, Senior Analyst, Games
[email protected]