No one, most certainly not Sony, has forgotten their mistake of pricing the PlayStation 3 at $499 USD back in 2006. It cost the company a lot of bad press and is still a running meme over a decade later.

When Xbox One was announced to be $499 in 2013, it received a similar fate, which was (thankfully?) lost in all of the poor online-only messaging that caused Microsoft to stumble out of the gate in this generation, giving PlayStation 4 a lead again with their $399 console.

Fast forward to E3 2017, when the Xbox One had already gone through a price drop to $349, and Xbox One S had been out for just under a year at $299, when Microsoft announced Xbox One X, a higher-end, more capable console with oh-so-many teraflops of power, for, well, $499.

But it worked.

After a year on the market, Windows Central shared NPD analysis that Xbox One X “has been performing phenomenally… year-over-year growth like this at this point in the cycle has never been seen before.”

On May 9th, Japanese analyst Hideki Yasuda of Ace Research Institute released his report about Sony, predicting that the console, given all its power and focus on performance, will launch at the end of next year for a price equivalent to $499 USD.

As a result of this higher price, Yasuda expects the PlayStation 5 to only reach 6 million units in the first year, while it took PlayStation 4 only four months to sell as many consoles. By the end of its first full year on the market, PlayStation 4 sold 14.4 million consoles.

Sony’s current PlayStation 4 lineup.

Technology and entertainment website Inverse is postulating that Sony could be making a huge mistake by pricing the console at $499, even though it seems Xbox One X was able to overcome the higher price and improve console sales at the same time.

So why was the Xbox One X able to pull it off? Generations and options.

Xbox One X is in the middle of a console generation, Microsoft even touting that it is trying to split up what would be traditional gaming periods to go “beyond generations.” They repeated that phrasing multiple times throughout their E3 2016 conference where the Xbox One X (then Project Scorpio) was first teased.

Because of this gap, gamers who already had an Xbox One or Xbox One S didn’t feel a huge pressure to upgrade. Those who bought the Xbox One S also already knew that Project Scorpio was on its way, so there was no consumer backlash when Microsoft again updated their console a year later.

Microsoft’s current lineup of Xbox One consoles (Xbox One S All-Digital Edition not pictured).

However, with PlayStation 5 on the horizon (no, not that one, or that one, and not that one either), it will be the start of a new generation in earnest, just by virtue of the naming scheme alone. As such, gamers will more likely feel compelled to buy the new console, which will be seen as a base model, despite being more powerful than PlayStation 4 Pro or Xbox One X, naturally.

Microsoft, when they eventually release their new hardware, are likely to keep it in the Xbox One family, and can eliminate the Xbox One S from their product line, keep the Xbox One S All-Digital Edition as their budget model, reduce the price of the Xbox One X to $399, and introduce a new console (Xbox One X2?) for $499. No one is forcing the gamer into a new generation; they upgrade as money and desire allows, while their existing games and hardware all continues to work on the new console, so consumers are a lot more receptive to a $499 price tag.

Sony, on the other hand, could reduce the price of PlayStation 4 Pro to $349 or even $299, to compete with Xbox One X even harder, while its new console launches at $399, but with the announcement from Mark Cerny that this will be a PlayStation 5, not a PlayStation 4 Pro Plus Max (insert additional marketing buzz here), we’re unsure how the market will react to such a stark difference in perceived value for the price, and what may appear to be a lack of choice in consoles for those that want to play new games that are only available on the newest systems.

How do you think PlayStation 5 and Xbox One X2 will play out? Do you expect Microsoft to indeed go with an entirely new console structure and restart the generation in a more traditional way? Or do they continue going “beyond generations” and building on the Xbox One brand?

We’re likely to find out at least part of the story at E3 in just a few short weeks.

About The Author

Christopher Kalanderopoulos founded Eggplante in 2009 to cover one event in Los Angeles. It never occurred to him that it would make him the Editor of an online magazine for the next decade. He spends most of his time gaming, backing cool Kickstarter projects, and hanging out with his wicked cool nieces and nephews.

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10 Responses

  1. LCHMND

    XBox One X only sold well in its first months after release. It’s the worst selling model of any console out there. Currently XBox One is only selling 1/4 or what both Sony and Nintendo sell.

    PS4 will sell for 499,- and will sell crazy numbers on release for the backwards compatibility alone. And Sony will already sell it at a loss for that money.

    The author doesn’t seem to be well informed.

    Reply
    • OrangeCrush

      MS doesn’t report hardware sales anymore, but what your saying is highly unlikely given the massive growth MS has seen with Xbox in the last 4 quarters.

      Reply
    • YOUDIEMOFO

      PS3 was launched at a $599 price tag for the system that actually mattered the 60gb version with a card reader built in and four USB slots on the front. Oh and it was built with physical backwards compatibility in mind as they threw in a actual PS2 (damn near) inside of it.

      I paid $800 for mine on eBay when they were going for over a grand at launch. And I got Talladega nights with it as well as the first blu-ray made i think.

      So it was well worth it as that system lasted over ten years to say the least.

      Reply
  2. DJ

    I’m betting that both of the above posters are enthusiast, which is exactly what 90% of the people that will eventually buy a console are not. For every enthusiast that stands inline at Best buy on day one and is willing to pay $500+ for their day one gaming fix there are 10-20 mothers, grandmothers that are going to buy little Timmy the console that costs less. Enthusiast Gamers/ Hardcore Gamers must realize that their hobby isn’t just about them anymore they represent 10-20 million of the 200 million console market and an even smaller portion of the totality of gaming today. Basically what I’m saying is that if Sony comes out at $500 as their only option there won’t be enough TLOU, GOW, HZD, DBH or Spidermans to save them from that colossal mistake.

    Reply
    • Sigurd

      I completely agree with you. Those million of sales are from people that don’t necessarily care about the speed of the CPU or SSD, but rather what games you can play and what number iso n the box (5).

      Reply
    • YOUDIEMOFO

      Enthusiasts are the ones who make it happen and push hardware to become what it has recently.

      Reply
  3. steve

    The relatively weak ps4 and x1 hardware were the result of countless people whining all over the Internet, begging the next Gen consoles to cost 249…. then 199… there were even people saying a console shouldn’t costmore than 149…
    …and those idiots, who seem to care about saving money, are the ones who will spend 900 bucks on a new apple device, every 8 or 9 months.

    There was no restriction or limit, on the ps3… original cpu… fast memory. .. yes, the ps3 was quite expensive, but during a moment, it’s graphics could even top, or surpass, the best pc rugs, with the most powerful cards. ..
    Bluray player. . Hdmi… wifi…ps2 compatibility. .. media Centre features. ..

    That’s what you get, when you pay more : QUALITY
    AT the end, the ps3 easily surpassed the x360 sales (atleast 20 million x360 were third, 4th, 5th replacements…warranties…), and wasn’t far from the 100 million sales.

    With the ps4, sony picked cheapass components, low clock cpu… super weak gpu…only 5gb of memory were used in games. .as a result, the x1 could barely run cod:ghosts at 720p… and the ps4 games looked a bit better, but not like night and day. ..

    People tend to forget gamers can’t upgrade a console. What they buy today, will be the same system running the games released 4..5..6 years later.

    Fortunately, Sony keeps his trend, since the ps1, and basically multiplies by 10x the overall processing power. ..
    Ps1, 2 gflops… ps2, 20gflops… ps3, 220 gflops… ps4, 1.7 tflops… we should expect the ps5 to be at least a 15-20Tflops machine.

    The ps5, when it releases by mars 2020, or nov 2020, must be capable of running the future 2024….2025 games. ..Luke uncharted 6…. god of war 3 or 4…. a witcher 4 or 5…. a gran turismo 8 or 9…

    In order to achieve that, at perfect, no compromises, 4k60 or 30fps, even upscalled to 8k (8k tvs should launch by 2021..22..), sony can’t just grab an oldgen cpu… a already outdated gpu… very few memory. ..save money here. .save money there. ..and expect it to perform great.

    This is no longer the last gen consoles, with special operating systems, proprietary languages… where devs need several months before managing to display a few triangles on screen.
    No, this is about x86… that everybody masters.

    A ps3 or ps2, 4 or 5 years after launch, devs would manage to extract tons of processing power, by keeping optimizating their code.

    With x86, devs were able to max out the ps4 and x1, at at least 85-90%, since the 1st gen games. Not a lot of margin, for huge future graphical improvements. 2 years after launch, devs were already begging for more power. ..

    If sony or ms make a ps5 or x2, with cheap components, just to be able to release it at 349 or less.. and since the 1st games, devs already lack power to reach 30 fps.. or run at 4k…. what is it going to be, 4 or 5 years later.

    I’m glad the ps5 might cost over 550… 600… the more it costs, the more powerful it will be. We don’t buy a new console, just to gain 20% better graphics. .

    Mark cerny said, with the ps3 and ps4, there was no true leap, graphics wise. Yes, ps3 games looked better than ps2… ps4 games look better than ps3… but how different is tlou on ps3.. and the ps4 remaster…? Very little. .

    With the ps5, mark cerny want gamers to truly experient a huuuge change… kind of, like watching a dvd, then, a 4k version.

    To achieve that, the ps5 will need power.

    I hope there will be a ps5 ‘core’, at 499, then, a ps5 pro, at 799 or 899, with muuuuuch more power.

    The problem with this generation of people, is the fact that everybody want everything NOW. A new device is released, they want to buy it the same day.

    Many years ago, people would do something called. .. ‘saving money’… that allowed to buy things, by waiting a little and saving a little, each month.

    The ps5 or x2 is going to cost 699 bucks ? WHY NOT start saving 20 or 30 bucks each month… ? So when the system gets released, the gamer already saved like 400 or 500 bucks.

    The funny part is, people are OK with paying 1000 bucks for a new iphone… 800, for a new tablet. .. watches… accessories… tons of crap…. but when it’s about buying a console, that will give them countless hours of fun, they want it to cost as little as possible.

    I wish they could make a hybrid, modular console, like a base ps5, in a way gamers could buy additional ‘processing boxes’, a little box with a cpu, gpu and some memory… that we could connect to a high speed port, on the back of the console, and add like 30% more power to the system. And we could daisychain those boxes up to 8 or 16… each new added box, a game could have Berge graphics, better framerate, better shadows. .. less aliasing. ..
    If a gamer decided to spend 2000 bucks in those boxes, and make the ps5 5 times more powerful. . Why not !

    No… we don’t need a cheapass, slow, 299 bucks ps5, that will barely be 50% more powerful than a ps4 pro.

    Reply

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