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Is the market ready for a $500 console yet?

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What should the PS5 & Xbox 4 cost at launch?

$500 (high specs) 45 60.81%
 
$450 (moderate specs) 8 10.81%
 
$400 (low specs) 21 28.38%
 
Total:74

At that price point I think the price point is too high of a price point.



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danasider said:
Zkuq said:

It's pretty interesting to see this thread just shortly after seeing a discussion (elsewhere) where people were seriously almost demanding and defending a $700 launch price.

I'm sure there is a group of people who would rather pay more money so that the tech used in the next generation of consoles isn't so far behind. That's a fair stance, except that in order for consoles to not be completely obsolete, the generations need to be shorter on top of the tech being more advanced. I doubt either of those are going to happen.

If Sony or Microsoft release a $700 console, it'll be dead on arrival. People need to understand consoles are not PCs. Each have their strengths, but if you want the pinnacle of tech, probably best to go PC in the first place.

Yeah, that's exactly the kind of people that were talking there. I'm not sure about the need for shorter generations though, although it's a fair point. At first you might be going for the more demanding crowd but once the generation matures a bit, you'll be more and more interested in the bigger crowd that's not willing to pay as much. That way there won't be as much demand for more processing power later on in the gen.

I agree about the price point though.



zygote said:

For 500 there better be some really strong incentives in the mix. I better not be able to live in modern society without owning it. It must be a game changer for my entertainment experience, have a game or function that completely revolutionizes the playing field, not simply update the graphics on existing gameplay. 

If VR isnt a revolutionizing game changer for you than nothing else will be.

What do people expect from a meager 100moneyunits difference.

I bought a phone for 500 € (S7). Essentially it was the same thing as the previously model i owned (S4). It broke. I got a new phone. S4 again for 310€ less. The 500€ phone did nothing for me. There was nothing game changing about it.

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I wonder if Sony will consider throwing in 6 months or a year of PS+ membership with a $499 console? Yes it will initially "cost" them a $59 annual membership fee, but existing PS+ users will see it as a $60 discount on the console purchase, and new PS+ users will get a full year of the service and will be MUCH more likely to continue that membership after the initial year is up.



I think $500 for a console is definitely market ready. $600 and $700 is where people will get angry.



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Two key factors are perception and competition.

Perception relates to the prices of predecessors at the time of launch of successors. The Xbox 360 launched at $400 at a time when PS2, Xbox and GC were all $150 or less already, so roughly three times as expensive; the PS3's launch price of $600 was 4-5 times as much the consoles from the previous gen. That looked a lot worse than during the transition from PS3 to PS4 and 360 to XB1 where the old consoles were $250 for a non-gimped SKU and the new consoles $400 and $500, respectively. So $500 won't look so bad for the PS5 and XB4 if their predecessors still have an MSRP of $250 by the time they launch.

However, the next question is competition. In a scenario where the PS5 launches at $400 and the XB4 at $500, or vice versa, $500 will look bad and the cheaper console will quickly gain the upper hand. One thing that wasn't present in 2013 is a strong Nintendo. It's much easier for people to hold out on new consoles when there is a viable alternative. Why rush to buy a $500 console with barely any new games when you can spend your time and money on a much cheaper console that has hit its stride; it won't be too hard to wait a year or two before taking the plunge. But the more important consideration in regards to competition is whether or not both the PS5 and XB4 will launch at the same price.



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If the graphics are improved and it's backwards compatible, can't see why not $500.



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ratchet426 said:

I wonder if Sony will consider throwing in 6 months or a year of PS+ membership with a $499 console? Yes it will initially "cost" them a $59 annual membership fee, but existing PS+ users will see it as a $60 discount on the console purchase, and new PS+ users will get a full year of the service and will be MUCH more likely to continue that membership after the initial year is up.

I was thinking MS may sell a their consoles with a year of Gamepass included, to make them seem like a better value.  



$500 is too expensive. If PS5 releases at that price (or higher), then it is going to get spanked again. With Google coming in and Switch already selling well, the competition looks even tougher this time around than it did in generation 7. And...I hate to say this...but we are kind of due for a recession. The business cycle is called a "cycle" for a reason. I hope it is not a big one like the 2008 one, but it could be.

There are lots of factors against a $500 console. From what I can tell Sony is going to try the same thing again as generation 7 and expect different results.



The_Liquid_Laser said:
$500 is too expensive. If PS5 releases at that price (or higher), then it is going to get spanked again. With Google coming in and Switch already selling well, the competition looks even tougher this time around than it did in generation 7. And...I hate to say this...but we are kind of due for a recession. The business cycle is called a "cycle" for a reason. I hope it is not a big one like the 2008 one, but it could be.

There are lots of factors against a $500 console. 

I agree.  There needs to be a base SKU at $399.  Google will be selling something for a whole lot less that will, presumably, play current gen games.  Ninty will be selling something at probably $250, or maybe even $200.  Since MS is reportedly going with two machines, I'm sure at least one of them will be under $400, maybe as low as $299.  So, if Sony, or anyone else, tries to go with the cheapest point of entry into their new generation being $500, they're likely gonna regret it.  

Of course, companies should have already learned this by now.  But, for some reason, they keep trying.  So, I have little faith in Sony to be smart about pricing.  I have little faith in MS as well, but am less worried about them since they seem to intend on having 2 SKUs.