Good post.In light of debunked rumours like the Take Two one yesterday, it might make sense to look at where Sony is right now in terms of investments.
Sony is on an acquisitions footing at the moment.
Their new CEO had previously led Sony's strategic investments before he was CEO.
His mid term plan calls for a focus on strengthening content IP across the company. His first moves were the EMI acquisition, the Peanuts/Snoopy acquisition and a couple of smaller ones.
The mid term (3 year plan) suggests Sony avoid short term profitability, and invest excess cash flow, of 2 Trillion dollars to build a suite of recurring revenue streams. He has earmarked 1 Trillion quite firmly for capital expenditure in this period, primarily for image sensors, but most of the balance - perhaps 700+ billion yen? - for strategic investments (including the EMI deal). The focus of those investments will be on strengthening content IP and filling holes in technology IP. But given his focus in the strategy on Sony's position connecting users to content IP, I think the bulk of that would be channeled toward content acquisitions.
Ex the EMI deal, that leaves a few billion dollars of new cash in play for acquisitions over the next couple of years, assuming Sony meets their forecasts etc. They could leverage some of the existing cash they're sitting on and other instruments (e.g. stock or debt) in future acquisitions.
For the games business? It is, in the CEO's terms, their largest 'community of interest' connecting content IP to users. He says he wants to strengthen and grow their IP. I wouldn't be surprised to see Sony execute on acquisition activity in this transition phase to PS5, be it more mini acquisitions like Microsoft's recent ones, or the Audiokinetic one, or something a bit bigger. They could, realistically, spend up to and into maybe low single digit billions cash here, if gaming was to get a look-in commensurate with the business's importance to Sony. I'd use that range as an upper limit, when it comes to weighing up future rumours. Double digit billions like the Take Two rumour? That would be a stretch, and outside the scope of their mid term plan it seems. But yeah... do keep an eye on Sony and their cash activities. They are looking for opportunities, and I see little reason to thinking gaming wouldn't be in the mix.
Sony has stated they are more interested in buys akin to the audio kinetic one, but I wouldn't rule out studio buys either. They just need 1 or 2 strategic gets.
