The key to PlayStation's future is in the reach of its network

Sony had another crowd-pleasing media briefing at E3 Monday night, with most of the focus (smartly) spent on a wide variety of games from developers both big and small. But underneath the strong lineup of upcoming games is the key to PlayStation’s future: its network. In the middle of showing the company’s varied portfolio, recently-appointed Sony Computer Entertainment America CEO Shawn Layden took the stage to announce that PlayStation Now, the streaming games service that lets people play games off of faraway remote servers, would be entering open beta in the U.S. and Canada starting July 31. So, we already knew about PlayStation Now, but this emerging focus on new ways to leverage Sony's network capabilities shows that the company recognizes that playing the traditional “console wars” is old hat. “Winning” isn’t about who sells the most units of $399 hardware anymore, but it’s about expanding PlayStation’s network absolutely as far as it can reach, and charging for products and services through that. If you follow Sony closely, you’ll know that this isn’t a new revelation for the company. As early as CES 2012, now-CEO Kaz Hirai explained how Sony Entertainment Network would serve as the backbone of Sony’s hardware strategy, including PlayStation. Put simply, the network-centric strategy is a smart strategy to pursue. Sony certainly is still very much a hardware company as well, but as far as the game business goes, placing all of your bets on a $399 piece of hardware is incredibly risky. With PlayStation Now, the company’s games business can theoretically reach people who may not be willing to buy a $399 dedicated game machine, but already own, say, a Bravia TV that’s capable of streaming a huge library of PlayStation games. It’s a good way to try to mitigate an inherent risk of the game console business -- that someone won't want to spend hundreds of dollars to own a dedicated console. Layden also confirmed that PlayStation TV, which is essentially PS Vita hardware that connects to a television, would be coming to the U.S. for $99. While also not an incredibly surprising announcement (it was announced for Japan last year as PS Vita TV), it’s worth noting that this is a low-cost way for an average person to get PlayStation (and PlayStation Network) into their house. This is PlayStation recognizing that there needs to be services and hardware that will appeal to a wider variety of people, from those who balk at the idea of an expensive games console, up to the high-end early-adopters who just want a solution to stream games from PS4 (which the device can do). There’s also the side-benefit in that Sony can potentially fight off disruption from similarly low-cost mobile OS-based devices like the Kindle Fire TV. Of course a network strategy -- particularly the PlayStation Now aspect -- relies on a good connection. And believe it or not, there are still a lot of folks without internet, especially when having a smartphone is good enough for many. But Sony’s network strategy, wherein the network is the backbone for its hardware strategy rather than vice versa, is the future of PlayStation. And with all the E3 emphasis around the capabilities of expensive console hardware, it’s the network and its reach that will be a major deciding factor in whether or not PlayStation remains relevant in the years to come, in the eyes of the mainstream consumer.

Ah yes, the video games

That said, a wide-reaching network for games would never pick up traction, or have a purpose, if there were no games. Much like Microsoft and its Xbox conference Monday morning, the focus for Sony was — for the most part — talking about games, and showcasing a large lineup with plenty of variety. Last year at E3, Sony featured several independent game developers on stage, right alongside high-budget releases from major publishers. At the time, it was a surprising move, that these indie games had their own special segment carved out in this major conference. This year, there was no special segment to showcase a handful of indie game developers. Instead, games from small teams were generally sprinkled throughout the show and treated, basically, as video games, getting virtually equal billing without a huge emphasis on what is “indie” and what is “triple-A.” You had Bungie’s high-budget Destiny kicking off the show, followed by Ready at Dawn’s “triple-A” game The Order: 1886... followed by a lovely-looking game called Entwined that was developed by a handful of students. Electronic Arts’ Battlefield: Hardline showed up next to a Grim Fandango remaster from Double Fine. Wrapping up one segment of the show was No Man’s Sky, from small UK-based studio Hello Games. One result of this, as far as E3 presentations go, is that the PS4 isn’t pigeonholed as an indie games machine, and consumers view the console as having a wide breadth of content — that there is something for everyone. And smaller development teams can know that if their game is up to snuff, their game can, in a way, exist harmoniously alongside large releases. A big reason why PlayStation has been able to gain early momentum is because its strategies in terms of hardware, software and networking were laid out and generally followed from their inception. Sony’s E3 presentation reflected a commitment to its current strategies, which is why the momentum you see today has a good chance of continuing in the future.