Author: Zen, PANews
On July 1, Amber Japan officially changed its name to S.BLOX. After being acquired by a subsidiary of Singapore market maker Amber Group in February 2022, and then by Quetta Web, a wholly-owned subsidiary of Sony Group in August 2023, the company that operates the cryptocurrency trading service platform "WhaleFin" officially became part of the Sony Group.
Sony, with the purpose of "touching the world with the power of creativity and technology", has business segments covering "touching people" games and network services, music, film and television, "connecting people" entertainment, technology and services, and imaging and sensing solutions, as well as "supporting people" medical and financial services. In order to highlight the functions of the major industries under this group covering financial services, games and entertainment, in April 2021, Sony Corporation changed its name to "Sony Group Corporation", the first name change in more than 60 years.
Among the businesses, Sony's three major entertainment businesses, game and network services, music, and film and television, have developed rapidly in the past decade. In fiscal 2021, their overall operating income exceeded half of Sony Group's consolidated operating income for the first time, and their overall operating profit accounted for two-thirds of the group's consolidated profit. With the development and iteration of blockchain technology, especially the rise of the metaverse and NFT, which are closely related to entertainment products, Sony has also begun to cautiously explore and expand into the Web3 field.
Metaverse
As a hot word in the technology circle, the concept of "metaverse" began to enter the vision of many industries and enterprises in 2021. Sony, as an entertainment giant, is of course no exception. In its corporate strategy for fiscal 2022, Sony expects growth in the metaverse and plans to create new entertainment experiences in this field. Sony CEO Kenichiro Yoshida also revealed that the metaverse is both a social space and a real-time network space where games, music, movies and animation intersect, and is interested in launching more products with metaverse experiences for users.
After targeting the then-hot metaverse track, Sony quickly laid out its plans. First, in February 2022, it signed a three-year cooperation agreement with Premier League champion Manchester City to jointly create the world's first metaverse football stadium. Later in April, it was revealed that it and KIRKBI, the family investment company behind Lego, each invested $1 billion, a total of $2 billion in Epic Games, and placed a heavy bet on the metaverse. At the end of the same year, Sony acquired Beyond Sports, an AI-based data analysis and visualization company, which is positioned as a metaverse sports portal, providing real-time digital sports participation solutions for leagues, broadcasters, brands and end consumers, and providing sports content from traditional media and even metaverse communication.
NFT
There has been no consensus in the industry on what exactly is the metaverse and which technologies belong to this concept. In the future of the metaverse described by many people, NFT with interoperability and digital asset attributes is one of the essential elements, and it is believed that this technology can bring true digital ownership, economic activities and social interactions to the metaverse. In addition, in the foreseeable future, NFT technology has a wide range of application prospects in entertainment products such as games, music, film and television. Therefore, Sony has been interested in the NFT track since 2022.
In April 2022, Sony's subsidiary Sony Network Communications established an NFT business company in Singapore. The company is a joint venture between Sony and software development company Sun Asterisk, with Sony Network Communications' investment ratio of 70%. The newly established company aims to maximize the value provided to customers, creators and end users by leveraging NFT technology in Web3. According to the new company's website, its business includes "NFT business strategy planning support", "NFT issuance support", "unique token issuance support", "NFT game development support" and "NFT promotion support".
Sony Music, another division of Sony, has begun exploring the application of NFT technology at least in 2021, and participated in the NFT market MakersPlace's $30 million Series A financing that year. In 2022, it first reached a cooperation with the Solana-based NFT platform Snowcrash (which has been transformed into a music production platform using artificial intelligence), announcing plans to launch a series of NFTs from legendary musicians such as Bob Dylan; later established the Greater China division of RCA Records to explore opportunities in streaming, NFTs and the metaverse, and signed singers Wang Jiaer and Huang Liling; submitted NFT-related trademark applications for Columbia Records' logos, and plans to use its trademarks for NFT-supported media, music and podcast production, artist management and music distribution services.
In terms of games, Sony focuses on the research and development of NFT-related patents. The published patents include "Using tokens on a distributed ledger to track unique digital assets in games" and "NFT framework for transferring and using digital assets between game platforms". The former describes systems and technologies that can be used to track digital assets between different hardware platforms and works of different publishers, and the latter explores a method for cross-platform use and trading of NFTs. Sony also stated that it will build an NFT and blockchain system that can be applied to the PlayStation (PS) platform ecosystem.
Infrastructure
Entering 2023, Sony seems no longer satisfied with the development of NFT technology alone, and has further expanded its business scope in the blockchain and Web3 industries.
In early 2023, Sony Network Communications, a business unit of Sony Group, cooperated with Astar Network, a multi-chain smart contract network, to launch a Web3 incubation program for projects focusing on NFT and decentralized autonomous organizations (DAO) practicality. The program will be held from March to June, and the shortlisted projects may be considered for investment by Sony Network Communications. The incubation program was organized by Startale Labs, a Singapore-based company that is the development company of Astar Network and was founded by Astar CEO Sota Watanabe.
However, after the Web3 incubation program ended, it was Startale Labs, the organizer, that explicitly received a $3.5 million investment from Sony Network Communications. In September of the same year, the two parties further deepened their cooperation and established a joint venture subsidiary "Sony Network Communiations Labs Pte. Ltd." The new company will focus on the research and development of blockchain technology. Sota Watanabe said that the new joint venture will promote the development of Sony Chain, which has the potential to surpass Coinbase's previously released Layer2 network Base.
Earlier this year, Startale Labs raised another $3.5 million in a follow-up round of financing, with investors including UVM Signum Blockchain Fund, Sony Network Communications and Samsung Next Ventures, with a post-financing valuation of $63.5 million. In addition, according to Singapore's business information platform BIZFILE, Sony Network Communications' shares in Startale Labs have been transferred to the Sony Group, which to some extent symbolizes that blockchain has taken a step forward in Sony's business strategy.
Finance
In 2024, Sony began to expand its financial services to the cryptocurrency industry.
In March this year, Sony Bank, a subsidiary of Sony Financial Group, announced plans to release "Sony Bank CONNECT" in the summer of 2024. This new smartphone application, designed to provide privileges for digital securities and NFT holders, is designed to allow any user to access exciting experiences simply and safely. The app will be connected to the marketplace "SNFT" operated by SNFT Co., Ltd., where users can display and enjoy the NFTs they hold in SNFT.
With the launch of the product, Sony plans to provide digital content to customers who participated in past events and obtained NFTs, purchased specific digital securities, or answered questionnaires. In addition, they are also developing a blockchain-based wallet and plan to continue to expand functions based on customer feedback after the launch. Sony Bank said, "Sony Bank CONNECT will continue to expand its functions in the future after the launch in combination with customer needs, and contribute to the future development of the web3 entertainment field in Japan."
In addition, Sony Bank has started a proof of concept in April this year, planning to issue a stablecoin pegged to a fiat currency. The trial will be conducted on the Polygon blockchain. It is reported that Sony is exploring the use of stablecoins to promote the company's intellectual property in the fields of games and sports due to the advantages of lower payment and remittance fees. Sony's stablecoin trial will evaluate any legal issues related to the transfer of yen-backed stablecoins and is expected to last for several months. The development will be entrusted to SettleMint, a blockchain company based in Belgium.
The latest development in the cryptocurrency and financial business is that Amber Japan, mentioned at the beginning, was acquired by Sony and renamed S.BLOX this month. Its future plans will be rectified or optimized, including: UI screen redesign, new application releases, supported currencies and expansion of functions.
Since 2021, Sony has been continuously expanding the boundaries of its exploration of Web3, from the metaverse and NFT, to building infrastructure public chains, and then to contacting cryptocurrencies. For a large entertainment group like Sony, carefully integrating emerging technologies into its various business segments will neither be too aggressive and lead to excessive risks, nor be left far behind because of being too conservative. This attitude of tolerance for emerging technologies may be the key to its continued sixty years.
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