So next generation consoles come with a payment plan? Crazy to me. The whole point of consoles was price point/bang for buck.

Kinda like the SW2 comparison, but worse, consoles aren't cell phones. Consoles with mid gen upgrades may be slightly more cell phone like than they used to be, but it's far from a new model every year, and SNY went from a 3 year upgrade to 4 years, not the other way around. XB1 and XBS consoles also had contracts offered and that hasn't done much for them, so why would it all of the sudden hugely increase the install base for SNY next gen?

I wasn't saying nobody does contracts, and I wasn't saying my friend group and I are the only demographic, but everything points to a contract offer being something that will barely move the needle in terms of growth. You might get some existing PS5 gamers to sign up for that type of contract, but how would that really help if those same gamers would just buy a PS6 regardless, contract or not?

MLID has done breakdowns of the per part pricing and the PS6 Handheld could be sold at $599, break even, worst case. As for SNY and MS not doing any subsidizing, MS dropped their XBGP pricing recently, and how's SNY offering a monthly hardware package for PS6 much different vs subsidizing the hardware (bundles) $100 at launch? If anything a monthly hardware contract would be an even bigger subsidy. Even if Plus were included, that still doesn't guarantee extra sales anymore than a typical $100 subsidy to launch hardware does.

With all the tech going into the PS6 Handheld (and possibly PS6 Lite in that case) it's going to match if not exceed PS5 (while docked). It wouldn't outdo PS5 by a lot but it very well will be superior to PS5 overall. Kinda like how PS4 Pro punched above its weight along with PS5. PS4 Pro wasn't too far off what XB1X was achieving and PS5 was on par if not exceeding XBSX much of the time. Many didn't see that coming.

There are around 40 million PS4 users at this point. That's not a small market. That also doesn't include any non gamers who've wanted a PS5 but couldn't afford one, or new people looking into getting into gaming for the first time next gen, or getting back into gaming. I only know a couple people who said they'd like a PS6 Handheld, where as the rest have said they would all prefer a cheaper PS6 Lite console. There's no doubt a market for both, but I'd argue you'd see higher sales for the PS6 Lite.

To me, if you require a payment plan for the hardware like this, how in the world are you going to afford $70-$100 games, or $40 GAAS games with some microtransactions, or F2P with constant microtransactions?

If you can afford a $299-$499 console up front, I at least know you're much more likely going to be able to afford enough games during the course of the gen and beyond, to make it worth my while to subsidize it to get it in your hands.

A $399 PS6 Lite makes way more sense than a monthly payment plan for a $599 valued PS6 Handheld.

A price cut on Gamepass isn't subsidisation. Are we saying its now making a loss for MS whereas before the price cut it was profit? They've removed content like COD to reduce the cost of gamepass but being an evolving service its costs aren't fixed for us to talk about subsidisation in the same way.

I also wouldn't say "everything" suggests contracts wouldn't move the needle, unless there is actual evidence beyond anectotes of friends etc. Again it's not even an idea I'm married to, but when they spoke on business model they were referring to something bigger than just selling a PS6 lite IMO.

We can agree to disagree, but the last thing about a contract is that it is not the same as subsidising hardware, it's literally a binding agreement of the user covering the cost (and more often). Financially it's treated different.

Regarding MLID prediction, I'd love for that to be the case. Those for now are broad speculations on their part, with them even saying prices may increase quite a bit. I'm not fully against a PS6 lite, I just don't think it actually solves the issue they're facing in getting their active audience (mostly on PS5) to move to their next system and keep up engagement.

Don't forgot $10 a month to play online.  

Edit for the bolded: The notion of a monthly plan is not specific to the handheld. It's the PS6 period. Point is, of the 110m PS5 users that will exist by fall 2027, very few will be interested in a PS6 lite which is essentially a PS5 spec machine with some improvements and a weaker CPU. They would just stick with their PS5. How does Sony get this majority to buy into  their next $699-799 premium console.
 
We're 5months into the year and I've only bought one game. People don't need to spend a lot on software and many already prioritise free to play etc. Worth noting a contract is not a loss, that income is coming just over a longer window and many are sold at surplus (higher total profit compared to upfront cost). The main concern is getting people into the ecosystem. PS+ etc and contracts allow that through extremely low entry costs.

Also barrier to entry in regard to price is more than just a question of can/can't afford. It's psychological. Many people could afford to buy a $100 game but many wouldn't simply because they are uncomfortable departing with that much money in one fell swoop for a single game. Some of that same demographic however will knowlingly or not spend $50 on a cheaper game then spend another $50 over a year or 2 period on DLC, cosmetics etc.

The same logic applies to consoles and "hidden" costs like online access, more expensive software etc. I'm sure many people would rather spend $499 on a console and pay for online on a monthly, then spend $799 outright and have free online... even if the later is actually cheaper in the long run. 

They mentioned basic PS Plus. That get's you online gaming and a few free games every month. That doesn't really help SNY though. Paying to play online and only or mostly playing the free games wouldn't do much to help pay off the console and make a monthly contract worth it. I'd say SNY would have to lock you into Plus Extra at the very least to make it worthwhile if they're going to include online, which is also going to mean more money down up front and/or a higher monthly payment.

I still don't think that draws many PS4 owners or new customers next gen. There's also the question of what happens if you can no longer pay the monthly fee a year down the road.

No it's not a subsidy, but it's MS dropping prices. You think these big companies won't subsidize, yet MS is dropping prices. The reason being the existing pricing was too high and was hurting GP. Much like how how higher hardware pricing will hurt sales. The cheaper they can reasonably make prices, the better sales will be, especially for a new launch. MS even tried subsidizing XBS at launch, and while that certainly helped, it wasn't enough to compete strongly with PS5, so MS gave up. While it's less likely MS is going to subsidize hardware much next gen, it's normal for SNY to subsidize, so it's far more likely they will, especially with the worldwide economy being so poor. Look at what SNY did to get the price of the PS3 way down when they needed to due to poor sales, during that economic crisis.

You're free to accept or deny whatever reasoning is given for points made, but not seemingly accepting anything raises eyebrows when decent points are made. I've at least accepted your points, but those points about contracts making a big splash doesn't add up. We'll see what SNY ends up doing.

Well a $699-$999 next gen PS6 isn't going to lead to big sales. An additional $599-$699 PS6 Handheld (since you think the handheld might be even more expensive) also isn't going to sell well. You think a majority of existing PS gamers and new customers will all sign up for contracts?

Should SNY and MS start offering individual games on contract? GTAVI for $2.00 per month? Intergalactic:THP PS6 exclusive for $5.00 per month?

What happens when people sign up for this hardware contract (bundle), and then fail to pay a year into the contract?

If SNY makes them pay for it anyway, imagine what that will lead to in terms of future sales when it comes to new contracts. If SNY doesn't make them pay, then imagine the wasted 'subsidy' when the customer only paid say $525 of the $899 cost of a PS6. Is SNY going to let the customer keep the hardware at that point and just let it sit under their TV, or are they going to force them to give it back? Then what? Refurb it and/or sell it as second hand? How much of a headache is that going to be for SNY, and how much are they going to lose per unit? All during an uneasy period of poor economic uncertainty.

Contracts don't make much sense for consoles. Reasonable subsidies do.

I never said there won't be a "reasonable" subsidy, I said I doubt a lite will be making a profit at $499 (handheld $599), $100 being shaved off from battery/screen is likely a bit too generous... so I wouldn't consider $399 a "reasonable subsidy"it will be huge.

Something which I think all hardware makers will be unwilling to do especially given the usual cost decline likely won't happen in the generation as it happened in past or would way smaller & slower. Even MLID (your reference) has estimations going up to $699 for the handheld based of market conditions. Currently market conditions are bad.

And also the necessary understanding that most will only move to a full fat PS6 or a differentiated/comlimentary device, as they already have a PS5 in some ways as capable as the lite. No need to discuss selling software on contract because no one suggested that and software has no issue selling at $70.

Not really interested in discussing beyond this. Just wanted to explore the reality that a lite wouldn't be very meaningful to PS5 owners (if based on the handheld) and Sony explicitly saying they are exploring "different business" models means more then Subsidising hardware which is not different from what they've been doing, so we ought to pay attention there & let it inform our predictions.

PSSR 2.0 is such a significant upgrade over 1.0, that I do have to wonder if the handheld is a PS5 lite type of situation but with PSSR 3.0 (and future upgrades) to really help get PS6 level graphics just without PS6 specific features.

But I would also agree that a PS5 lite handheld in of itself is not that exciting if you own a PS5 right now. But I suppose this depends on price point and hardware features. Either way, I think Sony hardware is going to be very exciting to see in the next few years.