Notebookcheck

Opinion | If Sony doesn't accept a loss on initial PS5 console sales then Microsoft's Xbox Series X will wipe the floor with the PlayStation 5

Both Microsoft and Sony will likely have to take a loss with the next-gen console sales. (Image source: GamersRD)
Both Microsoft and Sony will likely have to take a loss with the next-gen console sales. (Image source: GamersRD)
Holiday 2020 is gearing up to be a true battle of the console giants: PlayStation 5 vs. Xbox Series X. Gamers have been discussing specifications, components, power, exclusive titles, backwards compatibility and more to decide which console could be classed as the better prospect. But if Sony doesn’t take a hit on the initial PS5 console run then Microsoft could utilize its superior financial strength to make sure the XSX wins the next-gen console contest.
Daniel R Deakin,

Price is one of the most discussed topics in regard to both the PlayStation 5 and Xbox Series X at the moment. While neither Sony nor Microsoft has yet revealed how much their pride and joy will cost, gamers have been hoping that both tech giants keep in mind the important aspect of affordability, which has been previously considered as the most vital factor in a potential next-gen console purchase.

The expected cost of the upcoming PS5 console has definitely endured some highs and lows: Not long ago a Canadian retailer offered up a pre-order price of CAD$559 (US$397) while a placeholder price published by a Danish retailer stated 6,989 krone (US$1,043). Although some PlayStation fans have claimed they would be willing to pay over US$1,000 for the PS5, it would seem like commercial suicide for Sony to go anywhere near that high.

Over time, price suggestions have started accumulating around the US$500 mark. For instance, an early prediction made by a Japanese research analyst settled on ¥49,980/US$499 as a potential price for the console, and this was long before Sony revealed the PS5’s specifications. The same analyst also estimated that Sony would sell 21 million PS5 consoles in the first two years of its product life cycle.

Microsoft has already shown off the design of the Xbox Series X. (Image source: Microsoft)
Microsoft has already shown off the design of the Xbox Series X. (Image source: Microsoft)

However, with the recent news that Sony might have to restrict shipments of the PS5 in its first two quarters to 5-6 million units, there has been growing concern that demand, along with the high cost of the components and assembly (estimated at a total of US$450), will force Sony to place a high price tag on the PS5. Xbox chief Phil Spencer stated in an interview that “we will not be out of position on power or price”, so this is Sony’s game to win or lose.

Sony will have to take a considerable hit with the initial release of the PS5 to remain competitive or surpass the Xbox Series X’s sales. But the figures involved will be astronomical: If Sony prices the first six million units at a gamer’s most optimistic price of US$399 and the costs are exactly US$450, then that is a loss of US$306 million just on hardware sales. Both Sony and Microsoft are huge companies with vast revenues, but Microsoft has a much greater operating income and can more easily afford to undercut the PS5 console.

Sony still hasn't revealed the PS5's final design yet. (Image source: PlayStation)
Sony still hasn't revealed the PS5's final design yet. (Image source: PlayStation)

With more power and potentially a cheaper price for the Xbox Series X that could leave Sony’s success with the PS5 solely resting on how strong its first-party game lineup will be. In fact, PlayStation boss Jim Ryan has already made it clear that these all-important titles “will make or break PlayStation 5”.

Currently, US$500 to US$550 seems to be the most widely expected range for the PS5’s price tag, but if Sony can aim for an initial price between US$399 and US$450 for its next-gen console then a Holiday 2020 success is practically assured, even if it costs hundreds of millions of dollars for the Japanese company in the short term.

Source(s)

Read all 17 comments / answer
static version load dynamic
Loading Comments
Comment on this article
Please share our article, every link counts!
> Notebook / Laptop Reviews and News > News > News Archive > Newsarchive 2020 04 > If Sony doesn't accept a loss on initial PS5 console sales then Microsoft's Xbox Series X will wipe the floor with the PlayStation 5
Daniel R Deakin, 2020-04-19 (Update: 2020-09-30)
Daniel R Deakin
Daniel R Deakin - Managing Editor News
My interest in technology began after I was presented with an Atari 800XL home computer in the mid-1980s. I especially enjoy writing about technological advances, compelling rumors, and intriguing tech-related leaks. I have a degree in International Relations and Strategic Studies and count my family, reading, writing, and travel as the main passions of my life. I have been with Notebookcheck since 2012.