Sony (NYSE:SNE) is working with Bank of America Merrill Lynch to sell its over-the-top (OTT) streaming platform PlayStation Vue, according to The Information. Sony launched Vue four years ago, bundling together live cable TV channels, on-demand videos, and a cloud-based DVR. Vue initially launched on PS3 and PS4 consoles, and was eventually expanded to other platforms like Roku, Amazon (NASDAQ:AMZN) Fire TV, Apple TV, and Android TV. 

Sony marketed Vue as an all-in-one TV solution for cord cutters, but it remained less popular than similar services like Dish Network's (NASDAQ:DISH) Sling TV, Disney's (NYSE:DIS) Hulu + Live TV, Alphabet's (NASDAQ:GOOG) (NASDAQ:GOOGL) YouTube TV, and AT&T's DirecTV Now. Let's discuss the three main reasons Sony wants to sell Vue, and whether or not it will attract any buyers.

PS Vue running on a TV.

Image source: Sony.

1. Too expensive to be competitive

Vue serves about 800,000 U.S. subscribers, according to eMarketer, compared to Sling TV's 2.4 million subscribers, Hulu + Live TV's two million subscribers, DirecTV Now's 1.5 million subscribers, and and one million subscribers on YouTube TV.

Sony initially hoped that the popularity of the PS4, which topped 100 million shipments earlier this year, would give Vue a bigger slice of the OTT market, but it was too expensive to stay competitive. The average annual price of Vue's tiered plans is $690 ($57.50 per month), according to eMarketer, versus $360 for Sling TV, $540 for Hulu + Live TV, $630 for DirecTV Now, and $600 for YouTube TV.

All of these bundled services trail far behind single-platform OTT services like Netflix, which serves over 60 million U.S. subscribers with an average annual price of $152 per year. Simply put, the Vue offered a lot of content, but viewers are pivoting toward cheaper services with a more focused selection of a la carte content.

2. Less industry clout, higher content costs

Vue remains unprofitable due to its licensing costs for third-party content, according to The Information's sources, and it has less clout than bigger players like Disney, Amazon, and Netflix in negotiating lower rates.

Sony was reportedly developing original content for Vue subscribers last year, but it's likely abandoned that plan. Sony probably realizes that it's smarter to simply develop new original shows (like Amazon's The Boys) and license them to other networks and OTT platforms. Doing so would strengthen the Pictures (movies and TV) segment, which generated 11% of its revenue and 6% of its operating profits last year.

3. Sony's streaming strategy was always a mess

PS Vue wasn't Sony's first stab at the streaming market. Back in 2006, it acquired the streaming video start-up Grouper and re-branded it as Crackle. However, Crackle was quickly lost in the shuffle between YouTube's ad-supported videos and Netflix's premium subscriptions.

A man watches a streaming video on a tablet.

Image source: Getty Images.

Crackle offered a wide range of Sony's own shows and movies, but it already licensed most of that content to other OTT platforms. Sony also didn't invest billions of dollars into original content for Crackle, so it never stood out in the crowded market.

That's why Sony sold a majority stake in Crackle to CSS Entertainment earlier this year. CSS merged Crackle with six of its other ad-supported networks, but the new "Crackle Plus" platform still served less than ten million monthly viewers after the merger.

Crackle and PS Vue were both poorly branded. Few viewers likely associated Crackle with Sony's media properties, while "PlayStation" Vue sounded like a service for PlayStation consoles instead of a multi-platform app.

Those odd branding choices, along with Sony's lack of meaningful investments in marketing and content, doomed the two streaming platforms. Therefore it makes sense for Sony to abandon those half-hearted streaming efforts and conserve its cash for other efforts -- like next year's launch of the PS5 -- instead.

Will PS Vue attract any buyers?

FuboTV, which has about 300,000 subscribers in the U.S., reportedly expressed interest in buying PS Vue, but The Information claims that those talks fell apart. The report also claims that Vue's content deals with other media companies might not be transferred to the buyer -- which complicates a potential sale.

Therefore, investors shouldn't expect Sony to divest Vue anytime soon. However, its interest in selling weaker non-core assets like Vue indicate that it's wisely streamlining its business to focus on the growth of its core businesses.