{"id":3091,"date":"2026-07-09T17:12:33","date_gmt":"2026-07-09T17:12:33","guid":{"rendered":"https:\/\/crosscountrymovingteams.com\/?p=3091"},"modified":"2026-07-09T17:12:33","modified_gmt":"2026-07-09T17:12:33","slug":"sony-essentially-destroys-its-own-defense-how-its-disc-free-ps5-plan-triggered-a-457m-lawsuit-and-undercut-its-antitrust-defense","status":"publish","type":"post","link":"https:\/\/crosscountrymovingteams.com\/?p=3091","title":{"rendered":"\u2018Sony essentially destroys its own defense\u2019: How its disc-free PS5 plan triggered a $457M lawsuit and\u00a0 undercut its antitrust defense"},"content":{"rendered":"
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Dutch consumer group Stichting Massaschade & Consument has filed a $457 million lawsuit on Tuesday on behalf of 1.7 million Dutch PlayStation users, arguing Sony\u2019s 30% PlayStation Store commission will inflate game prices once physical alternatives disappear.\u00a0<\/p>\n

Read more My Microsoft exit with no business plan led to a $40 billion internet company\u2014and a debate over risk vs. timing<\/a><\/p>\n

This comes amid backlash to Sony\u2019s move to get rid of physical games, with thousands of gamers flooding Sony\u2019s Playstation blog announcement to vent their anger\u2014ranging from disappointment to threatening to stop supporting Playstation altogether. This is because Sony now has control because without physical discs, there won\u2019t be a resale market that puts money back in gamers\u2019 hands or lets them get games more cheaply.\u00a0<\/p>\n

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How killing discs undercuts Sony\u2019s own legal defense<\/h2>\n

But that control is exactly what makes the disc phase-out riskier than Sony may have anticipated.<\/p>\n

Andrew Ching, the marketing chair at Johns Hopkins Carey Business School, who studies video game demand, told Fortune<\/em> the 30% \u201cSony tax\u201d applies only to digital downloads sold through the PlayStation Store.\u00a0<\/p>\n

Ching explained physical retailers, in contrast, pay Sony a lower, flat royalty based on how many copies they manufacture, not how many they actually sell. That structure makes physical games cheaper, especially second-hand ones, since a game\u2019s resale value depreciates as it loses its \u201cfreshness.\u201d<\/p>\n

Sony has historically pointed to that physical marketplace when defending itself against antitrust claims, treating retail competition like used games in resale markets as evidence it wasn\u2019t a monopoly.\u00a0<\/p>\n

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\u201cHowever, by phasing out physical discs, Sony essentially destroys its own defense,\u201d Ching told Fortune<\/em>.\u00a0<\/p>\n

Without a physical option, Ching said, price-sensitive consumers have nowhere to go but Sony\u2019s own storefront, absorbing the full price with no alternative in the resale space.<\/p>\n

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The backlash Sony didn\u2019t fully price in<\/h2>\n

Sony has framed the move to get rid of physical discs as simply following consumer behavior: Roughly 85% of PlayStation game sales are already digital. But that leaves a \u201cnon-trivial\u201d 15% still buying physical copies, according to Ching, who has studied the used-game resale market using historical data out of Japan.\u00a0<\/p>\n

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\u201cFrom a strictly economics viewpoint, making the physical disk is costly,\u201d Ching said, noting consumers reacted aggressively to Sony eliminating physical discs because the resale market is still robust.\u00a0<\/p>\n

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\u201cThere are people who are diehard, [who] grow up with Sony, with Xbox, and they still very much enjoy the flexibility of having a physical copy and the possibility that they can resell it,\u201d he said.<\/p>\n

There\u2019s math behind the nostalgia, too. A buyer who knows they can trade in a $60 game for roughly $20 is effectively paying $40 for it, Ching said. But once Sony removes that option, \u201ctheir willingness to pay is going to decrease,\u201d pushing some players toward switching consoles or simply buying fewer games.\u00a0<\/p>\n

Analysts say killing the resale market also hands Sony full control of the secondary market\u2014something it has wanted, given how resale competition erodes its own pricing power.\u00a0<\/p>\n

\u201cEvery resale and rental is value flowing to players and retailers instead of to the platform,\u201d Rhys Elliott, games analyst at Alinea Analytics, told GameSpot<\/em>. \u201cWithout discs, that converts into a fresh full-price digital sale or it doesn\u2019t happen at all, and both outcomes obviously suit Sony better than a thriving second-hand market.\u201d<\/p>\n

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Ching\u2019s research suggests that fear has been overstated in practice since buyers value a game\u2019s \u201cnewness\u201d enough that used copies are a weaker substitute than publishers assume. But he said the backlash is less about that substitution math and more about consumers losing an option they\u2019d come to expect.\u00a0<\/p>\n

Read more Current price of Bitcoin for July 9, 2026<\/a><\/p>\n

\u201cIt\u2019s always something that makes it very difficult for people to accept,\u201d Ching said.<\/p>\n

Xbox\u2019s opening, complicated by its own crisis<\/h2>\n

The backlash was supposed to hand a rare opening to Sony\u2019s oldest rival: Microsoft\u2019s Xbox.<\/p>\n

\u201cThey should entertain this strategy of reassuring their customers that they\u2019re not going to abandon the facilities anytime soon, and then they can potentially get people switched from PlayStation to Xbox,\u201d Ching told Fortune.<\/p>\n

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And it wouldn\u2019t be the first time. In 2013, Microsoft proposed similar restrictions for the original Xbox One, and Sony publicly committing to keep discs while Xbox users revolted.\u00a0<\/p>\n

\u201cThe slide was very real\u201d for Xbox at the time, Ching said, and he sees a mirror-image opportunity now.<\/p>\n

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There\u2019s just one potential problem: The same week that opening appeared, Xbox also announced major changes.\u00a0<\/p>\n

Microsoft Xbox CEO Asha Sharma announced the gaming division\u2019s largest restructuring ever \u2014roughly 3,200 layoffs, or 20% of staff\u2014and the spinoff of four studios as part of broader Microsoft cuts.\u00a0<\/p>\n

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Sharma exclusively told Fortune<\/em> in the pursuit of growth, Xbox \u201cmade a bunch of bets\u201d and \u201csimply spread ourselves too thin.\u201d Gaming revenue fell, driven by a 33% drop in Xbox hardware revenue, with operating margins Sharma described as \u201cthree to 10 times lower than comparable businesses.\u201d Despite more than $20 billion invested in content and hardware over five years, annual revenue has fallen by nearly half a billion dollars.\u00a0<\/p>\n

Ching describes the two brands as \u201cneck and neck\u201d in competition, but whether Sony\u2019s stumble becomes Xbox\u2019s opening\u2014or whether Xbox is simply too busy fixing itself to take it\u2014remains an open question.<\/p>\n

Microsoft and Sony did not respond to Fortune<\/em>\u2019s requests for comment.<\/p>\n

The end of the finished game, another squeeze<\/h2>\n

Ching points to a related shift reshaping how both companies treat the customers they already have. Sony and Xbox publishers increasingly lean on downloadable content (DLC) for existing hits rather than greenlighting new games.\u00a0<\/p>\n

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A high-quality new title can take up to six years and hundreds of millions of dollars to build, while a DLC expansion for a proven success is a far safer bet, since demand is more certain, he said.\u00a0<\/p>\n

\u201cBut this also means that the shift leads to fewer new games, less R&D devoted to developing innovative storyline and original game features,\u201d Ching told Fortune<\/em>.<\/p>\n

It also changes what buying a game feels like, Ching explained. Consumers increasingly describe the initial purchase as an \u201centry fee\u201d that keeps requiring payment with no end in sight, rather than the traditional model in which a player finishes a standalone game, feels a sense of accomplishment, and moves on to the next challenge.\u00a0<\/p>\n

\u201cThe consumer satisfaction of being accomplished has been sacrificed in this new DLC add-ons model,\u201d Ching said.\u00a0<\/p>\n

Read more Companies still don\u2019t know how to incorporate AI in a holistic way, says Wharton expert<\/a><\/p>\n

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