The big PS5 price reveal may include some surprise news for PS4 gamers later in 2020. That’s according to a new report that suggests the tech giant is facing certain challenges when it comes to the launch of the next PlayStation console. The PlayStation 4 has proven a winning product for Sony and has now surpassed 100 million units sold since it launched back in 2013. Meanwhile, the Nintendo Switch is now rocketing forward with console sales in 2020 and looks set to be the best-selling gaming device this year.
This is all adding up to the price and release date of the PlayStation 5 becoming a pivotal announcement for the next generation of consoles.
The thing is, Sony isn’t in any rush to reveal its plans for the PS5, and it appears we may know more about why that is.
Analysts and fans were expecting a big Sony event in February, but that doesn’t appear to be the plan.
And it looks like there’s a couple of factors that are shaping the final date of the unveiling of the PlayStation 5 console, as well as its final price.
According to Bloomberg, Sony wants to keep the final retail price of the PS5 as low as possible but is facing a competitive market for parts.
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The report states: “Scarce components have pushed the manufacturing costs for Sony Corp.’s next PlayStation to around $450 per unit, forcing a difficult price-setting decision in its battle with Microsoft Corp., according to people with knowledge of the matter.
“The PS4, released in 2013 at a retail price of $399, was estimated by IHS Markit to cost $381 to manufacture. With the $450 unit cost and a similar gross margin, the PlayStation 5’s retail price would have to be at least $470.”
The issues are tied to specific components needed to build the PS5, and it could mean further challenges for Sony when it launches its next-gen strategy.
The report adds: “The company’s biggest headache is ensuring a reliable supply of DRAM and NAND flash memory, with both in high demand as smartphone makers gear up for fifth-generation devices, according to people familiar with Sony’s operations.
“Samsung Electronics Co. just announced its Galaxy S20 product range, each variant of which will have 5G and a minimum of 12GB of RAM in the U.S.”
The other factor reportedly shaping Sony’s plans is the fact that Microsoft is launching the Xbox Series X in 2020, at around the same time. Sony’s chief financial officer, Hiroki Totoki, referred to this during a recent earnings call, telling investors:
“What is not very clear or visible is because we are competing in the space, so it’s very difficult to discuss anything about the price at this point of time, and depending upon the price level, we may have to determine the promotion that we are going to deploy and how much costs we are prepared to pay.”
The reference to competition certainly makes it sound like Microsoft’s Xbox Series X is playing a part in the continuing mystery. And it would make sense that Sony would want to wait to find out more about the pricing of the next Xbox console.
The only problem with this is that Microsoft may wait until E3 2020 to reveal more about the Xbox Series X. But as CCN points out, both tech companies may be suffering from the same components issues.
And that could mean Sony and Microsoft will look to keep the prices of the Xbox Series X and PS5 at the same level to combat this cost problem.
Another way to solve the short-term pricing issue would be to sell the consoles at a loss and rely on other parts of their businesses, including expanding on existing subscription services.
This report also suggests that Sony will be able to rely on continuing software sales from the PS4, as many games will be cross-generational at launch.
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