Things Keep Getting Worse For The PS5
We hope you've been saving up. A recent report from Bloomberg indicates that the PlayStation 5 might have become a costly problem for Sony.
According to Bloomberg's sources, many of the parts being used for the PlayStation 5 have become "scarce." This is due to a lack of "a reliable supply of DRAM and NAND flash memory," which are both being used extensively by the smart phone industry, which is also gearing up for a new generation. Other small costs are stacking up across the board, including the new console's cooling system, which costs a few dollars more than the industry standard.
This all adds up to a pretty hefty number for manufacturing costs. It currently costs Sony around $450 to produce a single PlayStation 5 console. This means that the company would have to charge around $470 at the very least in order to turn a profit. This sits pretty close to the projected $500 price point that has been guessed at in the past, but it still comes as something of a shock.
Even Sony's most powerful system on the market, the PlayStation 4 Pro, retails at $399.99, so it's understandable to wonder if gamers will be prepared to shell out that kind of cash. Naturally, this has plenty of folks over at Sony sweating.
How does the Xbox Series X figure in?
Up until now, Sony has usually announced price points early in the year of a new console's release. The company has recently intimated that it would wait and see what Microsoft's price would be for Xbox Series X before making a competitive decision. This makes sense, considering Microsoft is Sony's biggest competitor in the industry. The two companies would naturally want to match each other's pricing as closely as possible.
The problem here is that both companies have been reluctant to name a price point. At this time, we're further in the year than most companies would want to be without having started some kind of price-related marketing push.
Another interesting thing to note is what we've heard in the past regarding Xbox Series X's power. Specifically, we've heard that it may be an altogether stronger system than the PS5. However, we're not hearing any kind of internal rumblings from Microsoft concerning price points, at least not to this degree. It makes one wonder if Sony has heard something we haven't from the Microsoft camp. Otherwise, why would Sony be so concerned with Microsoft's system being more affordable than its own?
Sony intends to wait it out for the time being
This whole situation has been exacerbated by manufacturing concerns related to the coronavirus outbreak in China. With the possibility of manufacturing shutdowns at Sony's plants in China, it's understandable that the company wouldn't want to make an official price announcement just yet. Why risk making a big announcement if there's a chance production may have to be relocated? While Sony says the outbreak hasn't impacted its production schedule "so far," there is a chance that could change. That could cause further unforeseen price adjustments, as well.
Because of these different mitigating factors, Bloomberg's sources say that Sony has adopted something of a "wait-and-see" policy regarding an official price announcement. There are hopes that many of the shortfalls related to profits could be helped by the release of cross-generational games. Upcoming releases like Cyberpunk 2077 and The Last of Us Part 2 could potentially be available on both the PlayStation 5 and its predecessor. Folks who haven't made the upgrade to the newest console generation will still want to get in on these AAA gaming experiences, regardless of platform.
Sony is in an interesting position
Despite being able to rely on games released for the PS4 as a source of revenue, Sony is still left in a conundrum. How on earth does a company make a profit off of such a high-cost console? Apparently, that has become a subject of debate among Sony staff, with some preferring to get the system out and to figure it out later.
According to Bloomberg, "Some Sony games staff think it should sell the new console at a loss if necessary to match Microsoft's price, while other Sony executives would prefer to make money as the company did with the PS4."
Obviously, it's the goal of any company to make a profit; particularly with its latest big release. Hopefully Sony will find ways of splitting the difference without putting too much of a hurting on consumers' wallets. Whatever the company decides, Sony is going to want to announce a price sooner rather than later.