PS5 Confirmed Backward Compatibility

[DonFerrari]

The_Liquid_Laser said:

CGI-Quality said:

I think the PS5's limited reveal provides a look at what they're going for. But, unlike you, I can't make a matter of fact determination about what's in the box.....well.....because.....we don't know.....exactly..... what's in it. Not rocket science, my friend.

You are trying to make me say something that I never said.  I am only giving my initial impression.

Initial impression is that it sounds powerful.  That is not a plus.  That is a minus.  Maybe I am wrong and it isn't particularly powerful.  But if it is powerful, then that is going to increase it's price tag.  There is nothing fluffy about that.  That is just common sense.

Does stronger mean costier? Yes, does that mean it will retail for more than PS4? Not necessarily. Sony may be willing to eat more of the cost than they were on PS4 (they were profitable from release with a game and PS+ sold, which meant since PS4 had 50% attach ratio of PS+, that basically all consoles were sold at profit because at least 1 game was sold together). They could make PS5 costing 600 and sell for 399 if they see fit, considering revenue of PS+ and royalty of 5 games is about 150 USD. So on the first year they selling 10M consoles would mean 500M in loss on the HW on the first year, breaking even on the second year and then profit.

Let's say PS5 sell about 100M, with 10-15-20-20-15-10-10 spread just for simplification (I know curves would be different but I want to make a quick show).

First 10M sold at 200 USD loss, then the other 15 sold at 100 USD loss, then 20 sold at 50 USD loss (pricecut), then 20 at cost, the remaining 35M sold at 50 profit.

That would mean -2B,-1.5B,-1B, 0, +1.75B = -2.75B on the HW

PS+ subs would be about 40M for those 7 years span, considering we will have people that haven't bought PS5 still keeping their PS+ for PS4 and those buying PS5 also keeping about similar attach ratio. That would mean 2.4B per year on revenue or 16.8B in revenue.

SW sold let's consider 10 USD of royalty per game sold, 10 games sold per console, 100M consoles sold, this would mean 10B in royalties.

Sony could very well profit 25B in 7 years of PS5 even if they start losing 200 USD per console sold on the start of the gen. The key here is keeping people into PS+.