PlayStation has a new CEO again — kind of. On Tuesday evening in the U.S. and the early hours of Wednesday in Tokyo, Sony Interactive Entertainment announced that Hideaki Nishino would be the sole CEO of the video game company, following less than a year of serving as CEO alongside Hermen Hulst.
At the time the two were appointed as dual successors to former PlayStation chief Jim Ryan in May 2024, Sony touted its faith in the dual CEO (not co-CEO) model, with Nishino overseeing business and platform operations and Hulst heading up the studio and development side.
Now the company is backtracking on that strategy, and PlayStation consumers and the company’s competitors are left wondering why.
“When you see this, and you see new management throughout Xbox as well, there’s a lot of transition there. A lot of senior people from large game companies are taking jobs elsewhere, taking roles at toy companies and non-endemic firms that are sort of adjacent to games,” games industry analyst and NYU Stern School of Business professor Joost van Dreunen tells Variety. “So there’s a bit of a musical chairs going around the industry at the very high level. And I wonder how it will impact the future. Will you start to see people with gaming know-how running non-gaming companies? So I think Sony’s PlayStation decision, in this context, is sort of typical of where we are as an industry at large.”
According to van Dreunen, you should expect to see “more changing of seats” over the next few years as the gaming industry continues “transitioning in a big way.”
“In other words, I expect layoffs to continue in the industry. And I see, for instance also, despite their success, some of the major Asian firms from China and Korea starting to look at the books and start to make some cuts left or right, because not all of it is going to make it over the next two years,” he said. “And that means retaining and finding appropriate leadership to carry that through.”
In making the announcement that Nishino would take over as sole CEO of Sony Interactive Entertainment, Sony caused confusion by maintaining that Nishino and Hulst will each still remain CEOs of their respective business groups. Parsing that wording, van Dreunen reasoned why Sony is maintaining these titles while elevating Nishino over Hulst in the larger PlayStation business operations.
“I think based on what I’ve seen from CES and their announcements there, they’re casting a much broader net around technology for the coming decades,” van Dreunen said. “They’re developing this headset. They have a whole bunch of this middleware in development. So I think Sony is really pushing into using its technology as an unlock for creators, and to appeal to both first and third-party creative firms in all industries. Not just games, but music and film, as well. I think that’s a better suited role there. You just have a little bit more of a streamlined effort. And then at the same time, while that makes sense for Sony at large, PlayStation still needs to evolve to be better suited for the coming decade. It is obvious that the games industry has been having a tough couple of years, and will probably continue to be the case in the near future.”
He added: “Sony, as one of the tallest trees in the forest, catches the most wind. They feel it immediately when they have a failure like ‘Concord.’ And so I think that they still need someone fully in charge of the content side to build the games division into a broader, more media-appropriate entity. That’s why I think it makes sense. This is not meant in a diminutive way, but it’s a bit like having a dinosaur that’s so large that it has two brains just to kind of navigate itself. I think that’s really what this is.”
While it is initially shocking to switch up the succession plan, van Dreunen says it’s ultimately for the best they came around on it, as the two-CEO strategy is a “transitional model” and industry data “so often proves that when you have multiple CEOs, it just becomes confusing internally and externally.”
“Companies are better suited with a single head at the top because for-profit organizations are not democracies, necessarily,” van Dreunen said. “You can discuss and rely on each other and share responsibility, but you have to have some kind of sound division of labor. It just makes everything more efficient that way. I just don’t think that on the long term, you can have too many divergent visions. So in my mind, any kind of co-CEO setup generally feels transitory and eventually will fall back to a singular person in charge.”