Bloomberg reports that negotiations for this particular agreement began over a year ago and were handled mainly by Sony's senior management in Tokyo and, "largely without the involvement of the PlayStation unit". Managers reportedly had to calm PlayStation employees and "assure them that plans for the company's next-generation console weren't affected". Ryan added that Sony's recently announced partnership with Microsoft on streaming technology should be seen as a "statement of serious intent" to keep improving the growth and scale of PlayStation Now, but offered no further details. The limitations of PS Now has forced Sony to seek a collaborative effort, and they've obviously concluded that Microsoft's Azure technology is the better bet.
Exactly what that entails remains to be seen, but presumably Sony will be transitioning its streaming game service to Azure, or building a new one.
Google, for its part, recommends at least a 25Mbps connection for a quality experience on its Stadia streaming platform.
"Sony feels threatened by this trend and the mighty Google, and has made a decision to leave its network infrastructure build-up to Microsoft", said Asymmetric Advisors strategist Amir Anvarzadeh.
Notably, the data servers behind Sony's PS Network are now run by Amazon Web Services, but according to a person familiar with the matter, Sony and Amazon couldn't agree on commercial terms for deeper collaboration on cloud gaming when they met a year ago.
Microsoft was the obvious second choice, and the consensus seems to be that at least in the short term, Sony is the big victor here.
The company has also set up PlayStation Productions to oversee the adaptation of its games to film and television, so much continues brewing in the world of PlayStation.
Sony's share prices seem to reflect approval from investors, jumping by 9.9% on Friday following the announcement -the most in 18 months. Sony intends to use PS4 games to encourage early adopters, which it says are critical for the PS5's success.
This makes a lot of sense, considering the relationship the two companies have been enjoying as of late, but it also makes business sense.