I think their business is far from collapsing, I also thing there are absolutely zero similarities to what they do and what MS is doing/has done. There is a very very very big difference between releasing your games day and date on other platforms and releasing some of them 18-24 months later on other platforms.
It's nice that you think this, but the truth is the similarities are all right there. The only difference is timing and, in practice, as time goes on, a 1-2 year stagger (probably shorter if not Day 1) between console & PC versions will feel like nothing to a lot of people since there are so many games to play in the meantime. Not to mention evergreen GAAS titles that will also take up their time, and those games are all on console & PC Day 1if we're talking about PlayStation & Xbox.
So what I'm getting at is, increasingly this stagger window of SIE's is going to feel like theatrics for more and more people, who have less and less reason to play those games Day 1 since they might have yet many other games they're playing or look forward to playing. If buying habits begin to take shape around that, at that point SIE are just hurting their goal of maximized profits by doing the staggers in the first place. But that would only happen because they've engineered conditions to influence buying habits negatively impacting their own console in the first place...
....which is exactly what Microsoft ended up doing. So sadly, I'm gonna have to say that very soon, that 18-24 month stagger window (which given remarks like these from Hideaki, suggests that will shorten) will "feel" like a 3-6 month stagger at most for yet more people, given all the other options they have to play and how much of a shared library console & PC already have these days (especially for Day 1 releases) compared to even a decade ago. If SIE are counting on that stagger to prevent an onset of problems
similar to (but not exactly like) what Microsoft saw with Xbox, quite frankly...they're completely delusional.
And do you really think someone that has only $450 to spend on a gaming platform is going to buy or build a PC and skip the PlayStation because the games may come 2 years later?
Well if that person has to also buy PS+ and some games to get any usage out of that console, and they may not even play all the newest AAA bangers Day 1 as-is (maybe they prefer indies for example), or they don't need fidelity quite like at PlayStation level to feel it's "good enough"...yes, the likelihood increases for those people to buy or build a PC, or get a laptop for gaming.
If we're also talking people who already use a PC for school or work and would prefer consolidating their time to a singular device anyhow, then that likelihood increases even more so. What SIE need to ask themselves is:
how many high-ARPU hardcore & core enthusiasts are likely to make the switch to PC in light of their current or potential future accelerated PC strategy?
TBH, they don't have the answer to this yet, we saw that when Herman was answering the Goldman Sachs investor earlier this year. So they have to infer it from Microsoft's moves with Xbox, and I 100% doubt Microsoft are giving SIE or anybody else that type of data (in part because they're ashamed of it). Any high-ARPU hardcore/core enthusiast who doesn't play all of SIE's 1P games Day 1 is immediately much more likely to make such a switch, if they also dabble some in PC. SIE getting less of the big 3P exclusives like FF going forward just further compounds on that.
People don't understand that two companies can have the same or similar strategy but different execution.
More importantly, I don't think Day 1 PC is what hurt Xbox rather the lack of AAA games and Day 1 GamePass is what hurt them. Day 1 GamePass meant they had to limit their budgets, something that Sony mentioned and were mocked for (again different execution and strategy).
Microsoft started putting their games Day 1 on Steam at the same time they were launching Series X & S. The correlation here is almost too obvious, only obfuscated some by external factors that artificially boosted Xbox demand for a short while (pandemic lockdowns, chip shortages, PS5 & PS4 shortages coupled with plenty of Series S supply). If you take those away, the collapse in Xbox sales we started to see in late 2022 would have started likely a year earlier, meaning they'd be even lower in LTD than the ~ 27 million they're currently at.
Only things that may've staved off the collapse partially would've been the Zenimax acquisition but that'd be to retain hardcore & core Xbox enthusiasts in the hardware ecosystem longer. Would not have manifested in sales boosts outside of that without games and, well, PS5 had Deathloop & Ghostwire as timed exclusives so there 'ya go. But I also have to keep saying: yes lack of any big super-popular mainstream AAA exclusive and the Game Pass push also contributed to Xbox's console collapse.
That said, no one should pretend the Day 1 push on Steam wasn't a factor. And I specifically mean Steam here; MS were doing Day 1 partially on Windows Store but that market place was a dead zone for PC gaming, plus MS still retained full control of the storefront so even if a decay would've began console-side, they'd have full lateral conversion of revenue and profits to their own Windows Store instead, with minimal loss to outside ecosystems.
People like to convince themselves that people are clamoring to buy PCs to game rather than consoles, but x,y,z is holding them back. It just isn't true. Consoles have never been the most powerful way to play games. Arcades were always more powerful. PC was always potentially more powerful. Just like handhelds have never been the most powerful way to play. Consoles create a boutique experience that people want. They also offer the best performance for the dollar. That isn't going to change.
You are convincing yourself that most people on console "need" hardware comparable to a PS5 or PS5 Pro in order to get "good enough" gaming performance for their time. This isn't true. Many games on PS5 don't even fully leverage the hardware, meaning to run those specific games, you could get away with a PC that's at PS5 level or even lower spec-wise (within reason) and still run those games at peak or at least good-enough settings.
The truth is, yes consoles haven't been the outright most powerful option for gaming in any generation. You're right on that. But consoles have always sold on reasons other than just performance or providing a "boutique experience". They also sold because of their games, and in almost all past generations, there was either a strong distinction in library offerings or ease-of-access that helped create value for consoles beyond just being the "best performance for the dollar".
-Console vs. Arcade: Even if for many early consoles the home versions of arcade games were technically inferior, there were far more copies of the home cart made vs. coin-up machines for that same game. You could rent the games and as a novice, save more money playing them at home then trying to beat them at an arcade. Home consoles were also available in much higher quantities and in more locations than coin-op machines.
-Console vs. PC/microcomputers: Up until the 7th gen, the vast majority of software library between home consoles and PCs were very distinct. Even certain genres were very specific between the platforms. If you wanted to play point-and-clicks, 4X, CRPGs/WRPGs, flight sims or simulator games (or the "real" FPS games), you went PC. If you wanted arcade racers, racing simulators, JRPGs, platformers, survival-horror, 3D action-adventures etc., you went console. Very rarely did you see consistent presence of these set genres (and even many established IP) across the two platforms for a period of decades until around the 360 era.
Also worth mentioning is that even up to the middle of the PS3/360 era, PC gaming was a lot more complicated for the average user to get into for AAA releases and at stable/acceptable performance levels. The further back in generations you go, the more true this holds. Most kids & teens on PC today would have never bothered back in the late '80s or '90s where you had to manually set up DOS settings in the BIOS to configure resources so your game could run, or map memory extenders, or manually configure driver settings. Hell in some cases even as late as into the late '90s if you didn't have the right GPU, you simply weren't going to run a game like Quake outside of software rendering mode.
Combine that with the prices needed to get even "basic" performance out of a game on PC, versus what mainstream consoles were selling for at the time, and all of those factors meant there was very little audience crossover or market crossover between console & PC gaming. But during the latter parts of 7th gen, combined with the growing rise of Steam, and the lowering prices for "good enough" PC gaming hardware & memory, and these factors gradually diminished.
Nowadays, almost all of those market differentiations are absent, with barrier to entry for PC gaming (relative to back in the '80s, '90s or even most of the '00s) practically on par with console gaming. When we hear about stuff like shader compilation stutters or crap like that, it's really from the 1% elite of PC hardcore gamers who demand that everything MUST run perfectly and at the best possible settings. The vast majority on PC don't care for or notice that stuff, except in the rare cases of a game so poorly compiled they show up no matter your settings.
In fact, IMO PC now has a big advantage over consoles due in part to the decades of x86/x86-64 BC. There are a lot of games on PC now, both old and new, that you simply can't play on a PS5 or Xbox (or Switch, but the focus of this console-wise is solely on Sony & Microsoft). Oh how crazy things have flipped in that regard...
That being said Sony realizes gaming isn't just console and they're sleeping on markets by not being involved. That's why they're involved in VR, that's why they're getting involved in PC, and that's why they'll return to handheld, and enter mobile.
And there's a right and wrong way to do all of these things. Sony/SIE could've gone about their PC strategy much better. They could've iterated on VR more effectively & efficiently. They could've already been back in handheld and in a way more preferable than the Portal. They should've been pushing in mobile even before their push into PC.
We can agree that SIE having presence in these market segments is a good thing, while still acknowledging they went at a lot of these areas in frankly amateur ways that have caused more problems than necessary.