Considering the monetization trends of the gaming industry at large, which is itself an adoption of the monetization strategy first employed by the earliest mobile games, it is very important that SIE develop its Live Services wing of its business. Live Services, also known as Games as a Service, is explained best by Neil Patel: “Games as a Service [GaaS], was introduced as a barrier between consumer cost concerns and user engagement. It offers a way to bring down customer acquisition costs and has been proven to keep users in a game for far longer than the pay-to-play method” (Patel, n.d.). Patel further demonstrates by using EA Games—one of the top video game publishers—and its market value as an example. “EA Games, for example, increased its market value from $4 billion to $33 billion in just six years after introducing GaaS content” (Patel, n.d.).

The majority of SIE’s revenue comes from Live Services (listed as Digital Software and Add-on Content in their financial statements). Despite this fact, SIE is behind most of its publishing competitors in Live Service implementation in their games. One of SIE’s biggest challenges is increasing the percentage of their games that adopt a Live Service business model. If this does not happen, there will be dire consequences for the company in the form of major revenue loss and market share loss. Below is a chart detailing SIE’s revenue gained through their Digital Software and Add-on Content category, with three exponential smoothing forecasts with three exponential smoothing constants (listed as Alpha (⍺) then its value).

As shown, there is an upward trend in the data. Unless SIE is able to capitalize on this upward trajectory now, it will lose out on its largest source of revenue.