Conversations about the streaming video market generally revolve around Netflix (NASDAQ:NFLX), Amazon, Hulu, Alphabet's (NASDAQ:GOOG) (NASDAQ:GOOGL) YouTube, and HBO Now, as well as upcoming services like Disney+ and Apple TV+.

Many other companies offer streaming services, but they're often lost in the shuffle. One of those companies is Sony (NYSE:SNE), which repeatedly failed to crack the streaming video market despite being one of the biggest media companies in the world.

A young woman watches a streaming video on her laptop.

Image source: Getty Images.

Let's take a closer look at Sony's oft-overlooked streaming business, and see why its slow death represents a missed opportunity for the company.

The competition cracks Crackle

Sony bought the online video start-up Grouper in 2006 and renamed it Crackle. The multi-platform service offered free, ad-supported streaming videos just as Netflix pivoted from DVD rentals toward streaming subscriptions.

However, Crackle struggled even as YouTube dominated free ad-supported videos and Netflix convinced viewers to pay subscription fees for premium content. The arrival of Hulu, Amazon, and other subscription-based competitors exacerbated that pain.

Sony owned a broad portfolio of shows and movies, but it already licenses a lot of that content to rival streaming platforms. Sony also seemed unwilling to invest billions of dollars into original content for Crackle, so it started seeking out strategic investment partners last year.

That's why it wasn't surprising when Sony recently sold a majority stake in Crackle to CSS Entertainment. CSS will merge Crackle with six of its other ad-supported networks (Popcornflix, Popcornflix Kids, Popcornflix Comedy, Frightpix, Españolflix, and Truli) and its subscription service Pivotshare to create a new platform called Crackle Plus.

But after that merger, Crackle Plus will still serve less than ten million monthly active viewers. YouTube claimed to reach over 1.8 billion logged-in monthly active viewers last year, and Netflix finished 2018 with 139 million paid subscribers. Sony is retaining a minority stake in Crackle Plus, but it's doubtful that this tiny platform can gain much ground.

A young woman watches a video on her smartphone.

Image source: Getty Images.

PlayStation Vue hangs on by a thread

In 2015, Sony launched PlayStation Vue, a streaming service that bundled together live TV channels, a cloud-based DVR service, and on-demand videos. The cloud-based DVR service gave Vue an early edge against rivals like Dish Network's (NASDAQ:DISH) Sling TV, but high prices doomed the service.

Depending on the number of included channels, PS Vue costs between $45 and $80 per month. Sony positioned PS Vue as a competitor to regular cable bundles, but the streaming platform still required an internet connection -- so the combined cost of PS Vue and a broadband plan was often higher than a basic internet and cable TV bundle.

It also cost much more than Sling, which starts at $25 per month, or simpler streaming platforms like Netflix, Amazon, and Hulu. Instead of lowering its prices to stay competitive, Sony hiked PS Vue's prices last year due to "rising business costs." To make matters worse, PlayStation Vue's branding confused consumers, because it sounded like an exclusive service for PlayStation consoles instead of a multi-platform one for mobile devices, smart TVs, and set-top boxes.

Therefore industry watchers weren't surprised when various reports claimed that Sony only had about half a million Vue subscribers, compared to Sling's 2.2 million subscribers, last October. The upcoming retirement of Sony Chairman Kazuo Hirai, one of Vue's staunchest supporters, also indicates that the service's days are numbered.

Is there any hope left?

Sony's streaming platforms flopped because it didn't spend billions on original content to attract viewers, it wasn't willing to take losses to gain market share, and its clumsy branding strategies alienated viewers.

Sony will probably pull the plug on its streaming efforts soon, since it's already struggling to justify the widening losses at its ailing smartphone unit. Recent rumors regarding layoffs at the smartphone unit, along with its decision to sell most of Crackle, indicate that Sony is now prioritizing cost-cutting strategies over loss-leading ones.

Nonetheless, the death of Sony's streaming business marks a missed opportunity for the company, which enjoyed a slight head start against Netflix in the beginning. Unfortunately, poorly conceived strategies doomed the fledgling business before it could ever take flight.