[GI.biz] The PS5’s price hike is a sign of things to come | Opinion

[kyliethicc]

Good quick read on the PS5 price hike.

Will post quote the bits I found interesting . Full article is linked.

Inflationary pressure across the supply chain, and low real-terms prices for games, are an unsustainable combination – price rises are in store for both hardware and software.

Opinion by Rob Fahey Contributing Editor
Published on Aug. 26, 2022

…

While consumers may decry corporate greed, the reality is that this is being driven by inflation that has dramatically increased costs up and down the supply chain; certainly, there are some companies within those supply chains who are taking advantage of the broader inflationary climate to sneak in some profit margin increases, but it’s generally not the game companies at the consumer-facing end of the chain who are doing so.

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Inflation isn’t the only factor either. The fact that the United States isn’t seeing a PS5 price jump despite inflationary pressures also reveals the extent to which the unsettled currency markets are to blame. The strong dollar is effectively hedging against inflationary pressure for US consumers, while the relative weakness of currencies like the Euro and the Yen pushes additional costs onto consumers in those regions.

…

The comments from Internet wags about the PS5 price hike being irrelevant to consumers who can’t find a console anyway are largely intended in jest, but there’s a serious undercurrent to them as well. The fact that scalpers are still able to command a price premium for scarce stock of the console means that Sony’s price hike will likely be absorbed by the market without any significant impact on the sales curve for the device, at least at first.

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Nintendo, on the other hand, may well have a new Switch revision close enough in the pipeline to shunt off its inflationary price rises onto that new hardware launch, rather than bumping the price of existing models – although of the three console platform holders, Nintendo has in the past been among the least resistant to preserving its margins by bumping local prices in response to currency fluctuations.

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On the other side of that equation, most game software is actually being sold at a historically low price in real terms – occasional $10 price hikes at the launch of new console generations have not even tracked with inflation in recent decades.

The PS5’s price hike is a sign of things to come | Opinion

Sony may not have shown up for Gamescom this year, but the company still managed to dominate headlines from the show &n…

www.gamesindustry.biz

 

[Remember_Spinal]

good article, very good points…I wonder what nintendo will do. Keeps the switch going for another 2-3 years or price their next iteration at 400?

 

[azertydu91]

Good article but man I hate that title.... What to expect for the future ? Our answer: things.

 

[ChorizoPicozo]

My God Phill Spencer said they aren't increasing Xbox price. In fact; they will be give one console for each Game Pass suscribtion.

 

[DarkMage619]

My God Phill Spencer said they aren't increasing Xbox price. In fact; they will be give one console for each Game Pass suscribtion.

Xbox not raising their prices is good for consumers. It would be odd to try and spin that into a negative. For a system that shares the same major 3rd party titles the value proposition is clear.

 

[kyliethicc]

good article, very good points…I wonder what nintendo will do. Keeps the switch going for another 2-3 years or price their next iteration at 400?

I assume the next Switch (Switch 2 / Switch Pro / Switch 4K / Super Switch / Switch U) will cost $400.

Their current hardware is pretty cheap so they don’t need to raise prices. Switch OLED was that already (+$50).

Nintendo is at where Sony was with PS4 in 2018-2019. Sony wouldn’t have raised prices either.

 

[Remember_Spinal]

I assume the next Switch (Switch 2 / Switch Pro / Switch 4K / Super Switch / Switch U) will cost $400.

Their current hardware is pretty cheap so they don’t need to raise prices. Switch OLED was that already (+$50).

Nintendo is at where Sony was with PS4 in 2018-2019. Sony wouldn’t have raised prices either.

The series S vs the New Switch should be a fun conversation

 

[DewPoint]

The conversations surrounding the price hike have devolved into baboonery. Can't have a adult conversation without someone bringing out an ad hominem.

 

[Sircaw]

The conversations surrounding the price hike have devolved into baboonery. Can't have a adult conversation without someone bringing out an ad hominem.

WHAT THE BLOODY HELL ARE YOU TALKING ABOUT FFS, YOU EWE.

Make your point, if someone insults you with personal insults, report them.

 

[ChorizoPicozo]

Xbox not raising their prices is good for consumers. It would be odd to try and spin that into a negative. For a system that shares the same major 3rd party titles the value proposition is clear.

That is what I am saying bro.

Praise Phill!!!

 

[Dr Bass]

The conversations surrounding the price hike have devolved into baboonery. Can't have a adult conversation without someone bringing out an ad hominem.

I agree for the most part but there is something funny about saying you can't talk about a topic because of the ad hominem attacks being thrown around by baboons.

 

[rofif]

It’s understandable but eur and usd are 1:1 now

 

[IntentionalPun]

This is like.. the stuff we posted yesterday in a thread, the article lol

In the end the only thing I chuckle at is people here saying Sony "can't afford to" handle a supply chain price fluctuation. They don't want to afford it, and don't need to "afford it" because they will remain supply constrained for a long while.

 

[ChorizoPicozo]

This is like.. the stuff we posted yesterday in a thread, the article lol

In the end the only thing I chuckle at is people here saying Sony "can't afford to" handle a supply chain price fluctuation. They don't want to afford it, and don't need to "afford it" because they will remain supply constrained for a long while.

 

[MScarpa]

I thought Sony had a record quarter/year? Of course they can "afford it" they just want to pass it on to the consumer. It's their choice, so be it. Already got mine, but sucks for those in this economy that are tight on cash.

 

[Hezekiah]

My God Phill Spencer said they aren't increasing Xbox price. In fact; they will be give one console for each Game Pass suscribtion.

Would be interesting if they end up doing a U-turn on this - they've just said they're evaluating things so far havent they?

One thing in Microsoft's favour is that they don't reveal the Xbox division's profit and loss, so they can eat massive losses without it being clearly identified.

 

[ChorizoPicozo]

Would be interesting if they end up doing a U-turn on this - they've just said they're evaluating things so far havent they?

After that evaluation they decided no to increase prices.

One thing in Microsoft's favour is that they don't reveal the Xbox division's profit and loss, so they can eat massive losses without it being clearly identified.

Is this PR Win worth it? Sales numbers are going to decided that.

 

[DynamiteCop]

$80 games on PS5 and everything coming to PC either much sooner or day and date. It's too expensive not to.

and your reaction....

 

[ChorizoPicozo]

$80 games on PS5 and everything coming to PC either much sooner or day and date. It's too expensive not to.

MS reaction:

 

[DynamiteCop]