does microsoft afford to release the Xbox after the PS5?

[EricHiggin]

thismeintiel said:

EricHiggin said:

In order for MS to be able to accomplish this goal without doubt, they not only require multiple console hardware performance levels designed, but need to hope that PS announces PS5 as early as they did with PS4. If PS has any strategy, they will allow PS4 to keep chugging, and will announce PS5 around E3, and launch that same holiday, so that the next XB would have to wait for an entire year to launch the next holiday season. Waiting an extra year is only truly worth it for MS if they can use a brand new state of the art technology for significantly higher performance, as well as take a massive loss subsidizing it, to sell it for a similar price as the PS5.

PS seems to be playing it more safe with PS4 and Pro, but there is nothing stopping them from surprising everyone and pulling a PS3 again, just with a lower manufacturing cost and reasonable retail pricing. If XB tries to launch alongside PS5, but PS5 costs $600 to make and is sold for $399, then MS has to either go out of their way to make the 'XB2' for $700 or $800 to make sure they win the narrative, and also take a massive loss at $399. Even if they sold it for $499, while it would probably sell better than XB1X did due to it's value, the PS5 will still sell best due to enough value at a widely attainable price. Considering the XB1 situation as a whole, and that XB1X probably cost around $600 to make and was sold for $499 at launch, the odds of 'XB2' being subsidized by hundreds or sold for half price seems pretty unrealistic. If PS goes for a larger subsidy though, then there is no reason MS couldn't either.

If MS assumes that PS will at best, build a $500 console and sell it for $399, then even if 'XB2' costs $600 and is planned to sell at $399, if when announced, the PS5 hardware is worth around $600 as well, then even if 'XB2' ended up with like 1TF more performance, marketing it as "the more powerful console ever" won't mean jack. It'll be memed to death much like XB1 was. They could be more realistic and change it to "the most powerful console available", but it still won't matter much unless it has the software to back it up.

The later they wait after the PS5 is launched, the better their chances of being able to have the hardware power narrative as well as strong software to go along with it. If PS5 launches 2020, and MS waits to launch 'XB2' in 2021, then it better also have either plenty of vast quality first party titles, or 2022 level performance at a similar price to PS5 to make it truly competitive.

@ bold

It's important to note that Sony is going to be able to get more out of $600 than MS will.  Sony is going to have a 100M+ selling console that they can point to to better negotiate prices for parts.  MS does not have that advantage. Given the drop from last gen, I'd say its going to be pretty hard for MS to negotiate really cheap parts for the XB2.

Correct, there is no doubt truth to that, but I'm sure it also depends to some degree on what products in total are being purchased by each company. While I'm not aware of all the hardware SNY and MS sell, what parts are in them and where they source them exactly, I would think that it doesn't come down to each specific console product itself. How much of an extra deal that allows for the consoles themselves I don't know, but PS still should have a larger advantage in this case with SNY being much more of a hardware company than MS is.