Update 2/20/24
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www.ign.com
In an investor call viewed by IGN, Sony Interactive Entertainment boss Hiroki Totoki said it's harder to “shrink” the PS5’s die size and therefore cut console manufacturing costs compared to Sony’s ability to cheapen the PS4. “Therefore cost reduction is very difficult, simply put,” Totoki said.
One issue Sony faces as it considers the price of the PS5 during the fourth year of its life is the relatively high cost to shrink the console’s die size compared to equivalent costs during the previous generation. That leaves little room for maneuver, and suggests storage may be the only area of the console Sony could reasonably look to cut costs.
The original PS5 launched at $499, with a cheaper digital-only version priced $399.99. Last year’s PS5 Slim launched at $499.99, again with a cheaper digital-only version but this time priced $449.99.
In the financial call, Totoki said Sony does not want to rely on a PS5 price cut in any case. We want to make sure our business is profitable, as well we want to focus on user engagement, together with sales of units,” he said. “We need to strike a nice balance between all of those components.”
Sustaining user engagement, with the key monthly active users (MAU) metric at its core, is “the most critical thing in our business right now”, Totoki added.
To that end, Sony is doing well indeed. The company said it saw record high MAUs in December, with 123 million people playing PlayStation. Total play hours are up 13% year-on-year.
However, Sony has revised its PS5 sales forecast for the current financial year down, from its lofty target of 25 million consoles sold to 21 million. This despite a year-on-year increase in PS5 sales for the holiday 2023 quarter, from 7.1 million sold to 8.2 million.
Also...
Sony Says Big PS5 Price Cut Would Be 'Very Difficult' - IGN
Sony has said a big PlayStation 5 price cut would be “very difficult” as the console enters into the second half of its life cycle.
In an investor call viewed by IGN, Sony Interactive Entertainment boss Hiroki Totoki said it's harder to “shrink” the PS5’s die size and therefore cut console manufacturing costs compared to Sony’s ability to cheapen the PS4. “Therefore cost reduction is very difficult, simply put,” Totoki said.
One issue Sony faces as it considers the price of the PS5 during the fourth year of its life is the relatively high cost to shrink the console’s die size compared to equivalent costs during the previous generation. That leaves little room for maneuver, and suggests storage may be the only area of the console Sony could reasonably look to cut costs.
The original PS5 launched at $499, with a cheaper digital-only version priced $399.99. Last year’s PS5 Slim launched at $499.99, again with a cheaper digital-only version but this time priced $449.99.
In the financial call, Totoki said Sony does not want to rely on a PS5 price cut in any case. We want to make sure our business is profitable, as well we want to focus on user engagement, together with sales of units,” he said. “We need to strike a nice balance between all of those components.”
Sustaining user engagement, with the key monthly active users (MAU) metric at its core, is “the most critical thing in our business right now”, Totoki added.
To that end, Sony is doing well indeed. The company said it saw record high MAUs in December, with 123 million people playing PlayStation. Total play hours are up 13% year-on-year.
However, Sony has revised its PS5 sales forecast for the current financial year down, from its lofty target of 25 million consoles sold to 21 million. This despite a year-on-year increase in PS5 sales for the holiday 2023 quarter, from 7.1 million sold to 8.2 million.
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