PlayStation Was Largely Left Out Of Negotiations With Microsoft Over New Deal - Report

Last week, Microsoft and Sony made the unexpected announcement that they were laying the groundwork for a future partnership that could unite PlayStation and Xbox in some way. A new report from Bloomberg states that the news caught the PlayStation team by surprise.

The story cites people with knowledge of the situation who say Sony negotiated with Microsoft on the deal "largely without the involvement" of the PlayStation team.

"Negotiations with Microsoft began last year and were handled directly by Sony’s senior management in Tokyo, largely without the involvement of the PlayStation unit, according to people familiar with the matter," Bloomberg reported.

"Staff at the gaming division were caught off-guard by the news. Managers had to calm workers and assure them that plans for the company's next-generation console weren't affected, said the people, asking not to be identified discussing private matters."

Negotiations between Microsoft and Sony began in 2018, a spokesperson for Sony said. However, the company has not publicly commented on the claim that the PlayStation team was largely left out of the negotiations.

Bloomberg's story also claims that Sony and Amazon held discussions in 2018 to talk about the potential for a "deeper collaboration on cloud gaming." However, the two sides could not come to terms over the business side, according to a source. After this, Sony apparently started talking to Microsoft. Amazon's Amazon Web Services cloud computing platform powers the PlayStation Network, so Sony and Amazon were already working together. (For what it's worth, Amazon is also reportedly planning its own future game-streaming platform)

The announcement of the Microsoft-Sony deal states that the companies will "explore joint development of future cloud solutions in Microsoft Azure to support their respective game and content-streaming services." Additionally, Microsoft and Sony will work together to explore the possibility of Sony leveraging Microsoft's Azure datacenters for Sony's game and content streaming platforms.

According to the Bloomberg story, Sony realized that its own network services would not be enough to thrive in the future where cloud gaming is expected to take off, with new entrants like Google Stadia coming into the mix to compete.

"Sony feels threatened by this trend and the mighty Google, and has decided to leave its network infrastructure build-up to Microsoft," Asymmetric Advisors strategist Amir Anvarzadeh told Bloomberg. "Why would they sleep with the enemy unless they feel threatened?"

For what it's worth, the press release announcing the deal between Microsoft and Sony only mentions PlayStation by name once.

Microsoft's new game-streaming service is in the works under the working title xCloud. Sony has its own PlayStation Now streaming service that's been running for years already.

Despite no official announcement being made, PlayStation architect Mark Cerny has begun to talk about the PlayStation 5. Microsoft is also working on a next-generation Xbox, and it's expected to be announced at E3 in June.