Sony said on Tuesday it would shut down its cloud-based TV service PlayStation Vue in January, citing competition. Pay-TV groups have been squeezed globally as viewers switch to online video platforms that often offer cheaper packages and churn out original productions.
"Unfortunately, the highly competitive pay TV industry, with expensive content and network deals, has been slower to change than we expected," said John Kodera, deputy president of Sony Interactive Entertainment.
The entertainment segment would remain focused on its core gaming business, Kodera added. The content on Sony's PlayStation Vue, launched in 2015, can be accessed through the PlayStation Store on PS4 and Sony's partnerships with other entertainment apps, the company said.
On Wednesday, Sony published its fiscal Q2 earnings results, and said quarterly operating profit jumped 16 percent on robust image sensor sales, its strongest-ever result for the second quarter, and it raised its full-year earnings outlook.
Demand for smartphone image sensors has been robust, as phone manufacturers introduce multiple-lens camera systems for high-end models - a key differentiator as improvements in other phone functions and features have slowed. Apple, for instance, added a third lens to the iPhone 11 Pro model, matching the three-camera setup on flagship models for rivals like Samsung and Huawei.
But profit at Sony's gaming business dropped as contributions from big gaming hits last year, such as "Marvel's Spider-Man", waned and sales for its mainstay PlayStation 4 console, now six years old, fell.
Sony also faces harsher competition as Google parent Alphabet and Apple have entered the market for game streaming services. To better compete with new rivals, Sony this month slashed its annual subscription fee for the PlayStation Now cloud gaming service by 40 percent to $59.99.
© Thomson Reuters 2019