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Forums - Sony Discussion - Scalpers are threatening the profitability and longevity of PS5 | System suffers unusually low attach rate due to scalpers

https://www.videogameschronicle.com/news/ps5-scalpers-are-threatening-the-long-term-health-of-the-console-report-claims/

Sony was already facing challenges satisfying demand for the product, but shortages have been exacerbated by scalpers reselling large quantities of the console at significant mark-ups, keeping it out of the hands of consumers and in turn damaging pivotal software sales.

The knock-on effect is an unusually low software attach rate in Japan, Bloomberg reports. As noted by the publication, a healthy ratio for a new console is around one game sold for each console bought.

But based on Japanese sales data from Famitsu, Sony sold around 213,000 PS5 consoles in the product’s first month of availability and just 63,000 physical games, meaning consumers have bought less than one packaged game for every three consoles purchased.

Lucrative software sales are particularly important at the start of a console’s lifecycle when the hardware is sold at a loss, Bloomberg added.

There are other factors that could be impacting early physical PS5 software sales, most notably the shift to digital. In Sony’s last fiscal year, digital software sales accounted for 55% of total PS4 software sales, and they represented an even greater percentage of the total in the first half of the current fiscal year.

PS5 also comes pre-installed with a game, Astro’s Playroom, and is backwards compatible with PS4 titles.

“Even if we consider digital download software purchases, the percentage of sold PlayStation 5s actually in use is not that high, meaning the current demand is constrained by profit-taking resellers,” according to Hideki Yasuda, an analyst at Ace Research Institute.

Another analyst told Bloomberg that consumers’ inability to acquire the console and the resulting hit on software sales could negatively impact the profitability of the PlayStation business over the coming years.

“The PlayStation 5 could miss a critical chance to get into a good hardware-software upward spiral,” said Kazunori Ito of Morningstar Research. “The peak of the platform will likely be low and the platform’s total revenue earned won’t be as strong as we hoped for.”

Bloomberg even claims that a major Japanese publisher has internally discussed the possibility of delaying its PS5 games based on concerns it has about the early market response to the console.

Still think scalping isn't a big deal? It's hurting Sony's (and surely MS's as well) bottom line because no games are being sold. Why? Because the scalpers are hoarding them off with bots. Console sales mean nothing if no one's actually playing them because they're sold at a loss. And the funny thing is, I told you all this would happen, and I was proven right.

Yeah, yeah, I know what the response is gonna be, "the gobermint can't tell me what I can and can't do with something I bought (read: botted)" yes they can, and they already do, like I said, ticket scalping is illegal. When you're scamming consumers and hurting company's profits, I believe they have every right to get involved. One publisher even said they might delay their PS5 games because of this shit. 'Cuz if no one's actually buying the games, no one profits.



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Should both Sony and Microsoft seriously consider March as viable release month for their next gen console so that enough supply is provided in the market and that their early adapters who are considered their most avid consumers will not suffer? Sony and its game developers will benefit a lot too.



Scalping is a big problem in the short term but it's not gonna matter much in the long term. As supply ramps up, it will eventually catch up with demand like it always does. It's just a matter of waiting.

This year has just been a shit timing for a bunch of things. Covid plus so many launches in both pc and console hardware space just makes things that much harder to get. Especially during holiday season.



             

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Random analyst says x, any affect from scalpers will be short lived. If scalping continues to be a thing it means people are still buying them which means games will be also sold, if scalpers can't sell their stock the scalping will end.



Remember when i was tagged as Trolling in another thread because i brought up scalpers helping sell out the PS5 and Series X consoles.
I tried to tell people that this is a big deal and people choose to ignore reality.



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That's one possibility.

It's also possible that people are just buying PS4 games instead because there aren't any good PS5 games. Seriously, is there even a single good exclusive?



Even taking as fact every suggestion made in the argument, why is there any need for government intervention? Seems like an issue that manufacturers and retailers can solve on their own.



JWeinCom said:

Even taking as fact every suggestion made in the argument, why is there any need for government intervention? Seems like an issue that manufacturers and retailers can solve on their own.

There isn't a reason the government needs to get involved, this is clearly a manufacturer and retailer issue. If they have a high demand item and make very little of them, that should fall on the manufactures and launch dates etc



Scalpers hurt consumers not the games companies or hardware resellers.

A scalper exists to make a profit on something. For them to make a profit they have to shift a product. So for every product that is snatched by bots/sneaky people there will be a product being sold. Yes some people will there fore have less to spend on consoles after buying a scalped product but the people that buy from scalpers want to buy it for a specific reason and would (in the case of consoles) have factored this into their purchases. So if they wanted it for cod, there limit would be cod + scalp price.

As for the article, it only references physical and this has been declining. Sony have also shifted to providing a digital only platform with the ps5. Factor in COVID with people not able to go and buy the physical games from game shops and you get the result of fewer physical shipments. Sony also chucked in 15 games to play through the ps+ bundle.

The only thing which can be taken from the article is - Physical sales are down.
My response to that is - yeah, its expected.



Ka-pi96 said:

That's one possibility.

It's also possible that people are just buying PS4 games instead because there aren't any good PS5 games. Seriously, is there even a single good exclusive?

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