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I actually think we might get $399/$499 entry points.

According to Bloomberg the PS5 BOM was $450. I could see Sony taking a slight loss at $499. With a $399 all digital model, the PS5 is in great position to undercut Lockhart, at least in terms of value proposition, while "transitioning" their userbase at a pace they've never seen before. Sony would eat bigger losses on their cheaper model in the short term to gain more from revenue from their customer in the long term. If someone purchases the all digital model than Sony cuts out the middleman and increases their cut in services and software.