No doubt that, both sony and ms will take losses with their next consoles for at least 2 years. MS can take such losses easily, but for Sony which depends a lot on their gaming department, it will be a heavier task.
Subscriptions to various services are making it more financially tenable to take those early losses though, especially when they can rely on subscriptions from prior console generations to make that division look financially better.
It's going to be interesting to see if they will take a financial hit on each unit shifted or not.
Sure, MS can. Xbox, however, can not. I think this is the reason we've been hearing lately that the PS5 is more powerful. MS is going to have a decent box, but they don't want to lose a bunch of money on HW, so I think they'll launch at break even, maybe a slight loss. Sony, on the other hand, is more willing to take larger losses up front, since gaming is a big division for them. Gaming for MS is a much smaller focus, and gaming HW even smaller, hence them taking a bigger leap into streaming and PC gaming, as of late.
I think the most likely outcome is that they will both launch at $499, but with Sony taking a larger loss, they will have the more capable HW.
Xbox can... Seems Microsoft has opened it's checkbook up and is gearing up for next-gen, hence the purchasing of all the studios recently and holding things back for next-gen.
But they still need to answer to shareholders, so they certainly do still have limits and restrictions.
Plus Microsoft tends to roll other aspects into it's "Gaming division" to make that division seem more lucrative anyway, helps that division is also partly buoyed by the PC too... So they can get away with more than people realize thanks to clever accounting.
Well it have been over 10 years that we have been hearing MS infinite money would win they a generation, it have been 3 loses already.
The 6th gen was probably regarded as a failure due to the massive financial hits they received.
But despite coming in 3rd during the 7th gen... Nintendo, Microsoft and Sony were all incredibly successful, Microsoft made Billions and I would not regard that generation (Or any generation where a manufacturer shifts 70+ million consoles!) a failure.
The 8th gen is a bit of a step back, but I doubt we can regard that as a failure either, subscriptions to various schemes has made it a financially sound generation even if it wasn't a roaring success like the Playstation 4.
I think xbox is the one whit problems here. They have spend lots of money whit new studios and banking on gamepass ( they sure are losing money whit $1 deals and day 1 exclusives). Also, xbox sure isn't as focused in "selling hardware" as playstation, i mean look at Phill spencer recent comments about "selling consoles" and the "play anywere" thing.
Truly feels like Playstation is much more focused on making you buy their console than xbox, and at the same time people need to remember that xbox don't have unlimited acess to MS money, investiments on new studios, gamepass and new console sure are going to hurt.
Microsoft likely has the appropriate data to get a good gauge on how long a person is a paying subscriber to gamepass at this point, so having $1 gamepass entries is likely a short-term hit for a longer-term financial haul... Plus the more subscribers they get hooked into this gen, they will probably hope those customers translates over to next-gen.
What will be truly interesting is if Sony takes a similar approach to Gamepass in the future, then Microsoft will likely start to feel some competitive pressure on that front.