Playstation and the Power of Unexpected Consequences

Abstract

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