The year 2020 was touted to be a big one for the gaming industry. The next-gen consoles from both Sony and Microsoft are set to change the landscape of gaming, but there could be a hitch. According to a Bloomberg report, Sony won’t be releasing too many units of the PlayStation 5 this year, on launch. this, in turn, will increase the price of the console for the consumers.
A new console is always in very high demand when it’s launched. Gamers want to be amongst the very first ones to have a taste of the new technology. Looking at the previous launches, it is apparent that sales are sky-high in the initial phase of the release. However, this time around, things could be a little different.
Sony to Release Fewer PlayStation 5 Units
The new-age consoles will bring about significant changes in the way gaming works at the moment. Countless gamers have been waiting for the release of the PlayStation 5 later this year. However, the users’ plans could very well go caput if the price of PS 5 is much higher than anticipated while the number of units available is also lower.
Bloomberg reports that Sony is planning on reducing the units they will release in the first two-quarters of launch. Not only will this mean many will have to wait for their turn to grab one of the consoles, but it will also drive up the price significantly.
The very obvious conclusion one would draw from this would be that the COVID-19 has hampered Sony’s production capacity. However, turns out this is not the case. The promotional campaign that has taken a bigger hit rather than the production capacity.
There is an intricate ecosystem in play here. First off, the PS 5 will cost the company a pretty penny to produce given the consoles “ambitious specs.” Subsequently, this will drive the price much higher than was previously expected.
The scarcity of the components required for the production of the console plays another part in driving the price up. Meaning the production cost has increased too, leaving them little choice but to increase the selling price.
Increased Production Cost Affecting Plans
As previously reported by Bloomberg, it is costing Sony a whopping $450 to produce one unit of the console!
For instance, PS 4 was priced at $400 on launch. Comparatively, the PS 5 could be priced at about $100-150 more. Naturally, this could affect the demand for the console, which is exactly what Sony expects.
If you remember, back in 2006 when Sony launched PS 3, they priced it at $600. This unrealistic pricing cost the company big as all the initial sales projections went down the drain as people were put off by the price tag. The gaming giants are obviously worried about history repeating itself with PS 5, and hence producing fewer units in the initial phase.
Given the coronavirus pandemic, the global economy has taken a hit. Unemployment rates are significantly high, and not many will be jumping to spend such a high amount on a console.
The report also suggests that Sony is looking at producing 5-6 million units by March 2021, the fiscal year ending. This is significantly lesser than the 7.5 million units they sold in the first two quarters after launching PS 4.
Sony could always delay the launch of the new console, but they won’t entertain that thought too much. Microsoft is going ahead as planned with Xbox Series X, and Sony won’t want to be late to the party.
Watch this space for more news on this front.