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Otter on 02 September 2026
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The_Liquid_Laser said:
CosmicSex said:

This is incorrect.  Sony would not be charging this much money if they costs weren't as high as they are.  It will always be in their best interest to keep hardware costs down as it helps promote uptake of games and services which are a lot more lucrative to them.  The more people you can get into the ecosystem... the more actual profit you can earn.  They would much prefer to be able to sell the PS5 for 399.  Especially now that there is a game that could move as many units as GTA. 

This sounds good on paper, but the reality is that once they see people buying overpriced hardware, they are going to continue overpricing hardware.

For most of gaming history price cuts on consoles were the norm, but after the Switch launched, both Nintendo and Sony stopped cutting the price of the Switch and PS4.  This all happened before AI drove up hardware costs.  Sony and Nintendo simply made high profit margins on PS4 and Switch hardware, when hardware margins were slim to none in previous generations.  Basically, they figured out they could get away with charging more for hardware, so they did.

Same type of thing is happening right now with the PS5.  Expect baseline prices for hardware to stay high even after the AI bubble bursts.  If the console manufacturers can make money on hardware, then they certainly will.

Both things are true at once but I think the reality is PS5 sales were in the pits for a while and a game like GTA comes across once every 15 years. You can't base hardware pricing on a game that will :

1. Only arrive at the end of a generation or not at all (PS4 didn't get its own GTA).

2.The audience driving current hardware demand make up a tiny portion of actually PS5 sales. If there are 10m people eager to buy a $600-800 PS5 just for GTA that's cute but you can't survive off a 10m audience. Sony wants the 50-80m people who will actually keep their ecosystem alive and invest in other games etc. That majority audience is still price sensitive, hence PS5 sales being down so much in Q1 and Q2.

What I think this teaches Sony (and they already probably knew this from existing data) is that they can get away with a premium/high margin product next to whatever is the entry price product is. The high margin product will sell to that 10-20m price insensitive tech or FOMO consumer, whilst they promote the cheaper entry point to the mainstream.