PlayStation Team Reportedly Caught Off Guard By Sony And Microsoft's Cloud Gaming Deal

It is easy to imagine that all of the engineers and everyone else involved in Sony's PlayStation division saw the pact between Sony and Microsoft in the cloud gaming space coming. After all, the collaboration had been in the works for over a year. However, that is apparently not how it went down. The agreement between Sony and Microsoft was not just a surprise to the press and public at large, but also to most of the people involved in the development of the PlayStation console and related services.

In case you missed the announcement last week, Sony and Microsoft have entered into a vague partnership on "direct-to-consumer entertainment platforms and AI solutions," one that is centered around the latter's Azure datacenter solution.

"Sony has always been a leader in both entertainment and technology, and the collaboration we announced today builds on this history of innovation," said Microsoft CEO Satya Nadella. "Our partnership brings the power of Azure and Azure AI to Sony to deliver new gaming and entertainment experiences for customers."

Exactly what that entails remains to be seen, but presumably Sony will be transitioning its streaming game service to Azure, or building a new one. Whatever the case might be, Sony's PlayStation team was "blindsided" by the announcement, according to Bloomberg and its sources.

It also spooked the division. People familiar with matter told the news outlet that managers had to calm workers and assure them that work on the PlayStation 5 would continue as planned. From our vantage point, it seems that some in the PlayStation division were worried that Sony was moving to a cloud-only solution, perhaps to compete with Stadia, Google's upcoming cloud gaming service.

That is not the case. The PS5 will still launch sometime in 2020, and it will bring faster hardware and ray tracing capabilities to the fold, courtesy of a custom slice of silicon built around AMD's next-gen Zen 2 CPU and Navi GPU architectures.

As for the collaboration with Microsoft, there is much we do not know at the moment. However, one thing that is clear is Sony's willingness to adapt and evolve as the market dictates, even if that means it has to "sleep with the enemy," as Asymmetric Advisors strategist Amir Anvarzadeh put it.

According to the report, several key personnel changes also paved the way for Sony and Microsoft to work together. That includes some senior PlayStation Now staff moving to other divisions. Still, it's interesting that negotiations took place for more than a year without the PlayStation team being privy to any of it, if the report is accurate.