Sony to offer PlayStation Vue Internet TV service in New York City, Chicago, and Philadelphia within two weeks, plans nationwide rollout by the end of the year
Eric Pfanner And / Wall Street Journal :
Context & Ripple Effects
This announcement put Sony into the live-TV business over the open internet rather than through a cable box: PlayStation Vue would go live in New York City, Chicago, and Philadelphia within two weeks, with a nationwide US rollout promised by year-end. It followed the pattern set by the console maker's earlier streaming experiments and made Sony one of the first big hardware companies to sell pay-TV subscriptions directly.
The arc that followed shows how narrow that window was: the service launched six days later at $50/month with 85 channels including CBS, Fox, NBC, and AMC ([[a:827420]]), reached only about 100K subscribers by mid-2016 ([[a:870920]]), and Sony ultimately announced a January 30 shutdown date in 2019 ([[a:947326]]) after failing to scale against better-capitalized rivals.
First-order effects
- Local pay-TV subscribers in NYC, Chicago, and Philadelphia gain an alternative to cable bundles starting at $50/month, putting direct price pressure on incumbent cable distributors in those three markets.
- Network owners like CBS, Fox, NBC, and AMC gain a new licensing customer, but must decide whether selling channels to an internet distributor undercuts their carriage economics with traditional cable operators.
Second-order effects
- Content negotiations escalate: Sony's push for broader distribution leads to adding ESPN, ABC, and Disney channels to the lineup ([[a:835832]]), while the San Francisco and Los Angeles expansion brings à la carte options like Showtime and Fox Soccer Plus ([[a:830188]]), pressuring the bundle itself.
- Distribution costs force platform dependence — Vue eventually lands on Apple TV to reach non-PlayStation households ([[a:877915]]), meaning Apple captures part of the subscription funnel Sony built.
Third-order effects
- Sub-scale economics prove structural: with roughly 100K subscribers against rivals' larger footprints, Sony exits the category entirely by early 2020, signaling that virtual MVPDs without either massive content leverage or hardware ubiquity get squeezed out of the market they helped legitimize.
- The pattern points toward consolidation of internet TV around a few scaled players, with content owners extracting higher fees until only services with distribution or bundle advantages survive.
The trend: Pay TV is being unbundled onto the internet, but the market consolidates fast enough that even first movers like Sony's PlayStation Vue can't sustain standalone economics.