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Sony Buying Remedy Doesn't Make Sense (Page 1)

Sony Buying Remedy Doesn't Make Sense

Rumors say Sony could buy Remedy Entertainment, but... why?

By Derek Strickland from Jul 5, 2019 @ 10:00 CDT

Introduction

Rumors are circulating that Sony might start buying up studios to bolster its PlayStation 5 lineup, and that Remedy Entertainment could be one of them. But Sony already has a huge stable of developers working on big projects.

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Sony could buy Remedy, or at least that's what recent reports would have you believe.

The rumors are no-doubt incensed by The Wall Street Journal's recent coverage of Sony's future business plans, which states the games titan is pushing strongly for more first-party exclusives and third-party AAA partnerships. Well of course they are; the PS4 era's business decisions were extremely profitable, and Sony isn't going to just change course now. The thinking is the PS5 will be accompanied by a more aggressive AAA focus to ensure games released on the machine push the boundaries even further, and again this is an obvious move.

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Sony already has lots of developers

What's not so obvious is why Sony would buy Remedy Entertainment.

The company currently has 15 studios in its Worldwide Studios banner, including huge players like Naughty Dog, Guerrilla Games, Sucker Punch, Sony Santa Monica, Bend Studio, and its Japan Studio. That's a lot of teams to wrangle, and a lot of projects to fund. Examples of current big-budget exclusives include The Last of Us Part II, Ghosts of Tsushima, and the Horizon: Zero Dawn sequel.

Sony arguably doesn't need to buy up any more studios. It can afford to release 2-3 exclusives a year for the PlayStation brand. There's no need to over saturate the platform with too many diluted projects. Sony sees its first-party games as huge marquee affairs that squeeze out raw console power and open up new horizons. In many ways, its exclusives are kind of like huge sprawling films and take tremendous funding.

Sony isn't in Microsoft's position; the company has put emphasis on making high-quality console exclusives for years now, whereas Microsoft has pivoted strongly towards cross-platform releases and services. If anything, Sony will embrace both aspects and double down on its services before it buys out another big studio.

Buying up another studio like Remedy, who does fairly well every year, would undoubtedly be costly and require some serious finesse and negotiations.

Why Remedy Isn't Worth Buying... Right Now

This acquisition would also be further mired by Remedy's existing contracts with other publishers. As a result, Remedy's current value prospects drop considerably.

To get projects like Quantum Break, Alan Wake, and its new game Control made, Remedy has to surrender publishing rights to outside companies. Right now Remedy doesn't have much control over the projects it's created. It only just now got the publishing rights to Alan Wake back from Microsoft after a nine-year period.

This is another big reason why acquiring Remedy now isn't a good idea.

To get Control funded, marketed, published, and distributed worldwide, Remedy signed a deal giving 505 Games 20 years publishing exclusivity. That means Remedy can't make another Control game unless 505 Games signs off on it. And if Control doesn't sell well, 505 Games will probably just sit on the rights the same way Microsoft sat on Alan Wake (and is now sitting on Quantum Break).

If anything, someone should've bought Remedy back when they hadn't sold the rights to Control. Why buy a company who just sold publishing rights to its new IP?

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