Shawn Layden, former president of PlayStation Studios: “No one wants to take a risk on a unicorn ballet in space”

While last week it was Rockstar that shook up the video game industry with its decision not to include a disc with the physical version of GTA 6, these days it’s PlayStation that’s been making headlines. Starting in January 2028, it will stop manufacturing discs, which means the end of the physical format as we know it. These decisions come after a turbulent few years filled with layoffs and closures, and one person who has been explaining the situation exceptionally well for a long time is Shawn Layden.

Layden served as CEO of Sony Interactive Entertainment America from 2014 to 2018, and later as president of SIE Worldwide Studios (now PlayStation Studios) until he left the company in 2019. In short, he was one of the public faces of the Japanese company during the PS4 generation, one of the most successful in history.

Layden Offers Insights into the Current Industry

In an interview, Layden perfectly explained the current state of the video game industry, as well as how it differs from what it was like 30 years ago, during the first generation of PlayStation.

“If you could make a game for about 5 or 6 million dollars, like we could back on PS1, then you’d do 10 games. Ten different games and you could see what people were excited about,” Layden begins. “We had so many crazy games on PS1, because the cost-risk was manageable. You could litterally throw away 6 or 7 million dollars on a project that did not work, and learn something at least.”

“Now, if every throw of the dice is triple-digit millions, then risk tolerance goes to about zero. People in business wonder if a game is a sequel, an established IP…,” he continues. “They wonder what it is like, like Fornite meets Call of Duty in Zombieland. You have to come up with stories like that to get people to finance your game. But you are right, no one wants to take a risk on a unicorn ballet in space. No one is going to finance this. As long as we judge games solely on revenue projections, then you risk tolerance really goes to zero.”

“95% of the cost of building a game is just wages. It’s people. Wages have gone up quite a bit, and that’s why the costs of the games go up. So you have to look at the levers you can choose to move. Can you move the salary bar down and still stay in California? Probably not,” says the former PlayStation executive.

The fact is that AAA video game development has become one of the riskiest financial ventures in the entertainment industry as a whole—not just in video games—with budgets running into the hundreds of millions of dollars. Specifically, PlayStation has funded roughly a dozen “games as a service” titles over the past five years or so, very few of which have ever seen the light of day. And those that did make it out haven’t taken long to fade into obscurity.

Follow MeriStation USA on X (formerly known as Twitter). Your video game and entertainment website for all the news, updates, and breaking news from the world of video games, movies, series, manga, and anime. Previews, reviews, interviews, trailers, gameplay, podcasts and more! Follow us now!