Yesterday, Sony announced that they would be implementing a price hike for the PS5 in a whole lot of regions outside the US, citing inflation and other economic markers:
“We’re seeing high global inflation rates, as well as adverse currency trends, impacting consumers and creating pressure on many industries,” Sony said. “Based on these challenging economic conditions, SIE has made the difficult decision to increase the recommended retail price (RRP) of PlayStation 5 in select markets across Europe, Middle East, and Africa (EMEA), Asia-Pacific (APAC), Latin America (LATAM), as well as Canada.”
The price increase is different across all the mentioned regions, but generally speaking it works out to around a $50 USD price increase on both the digital and disc models.
So, global inflation is affecting not just Sony and PlayStation but everyone, so naturally, other companies are following suit, right?
Not exactly. The only hardware we’ve seen push up its price for vaguely similar reasons is Meta and its Quest headsets. But Nintendo has previously said it has no plans to raise Switch prices, and now, when asked for its response to Sony’s move by Windows Central, Microsoft was pretty unequivocal about what was happening with the Xbox.
“We are constantly evaluating our business to offer our fans great gaming options. Our Xbox Series S suggested retail price remains at $299 (£250, €300) the Xbox Series X is $499 (£450, €500).”
While it’s not impossible that Xbox doesn’t raise prices down the road, I’m not sure they would have said anything at all if that was a near-term plan. So why is Sony alone in the console space as the only one doing this?
Sony, though a big company, is still dwarfed by Microsoft, a $100 billion market cap versus $2 trillion, with one company able to eat some losses on one hardware offering for a time if it needs to, while Sony is hit harder by economic factors like this.
Sony also believes that demand is so sky-high for the PS5, which still sells out instantly with every restock, that the price increase will not mean a dip in sales nor cause them to miss their set targets. In a normal generation that may not be true, but the PS5’s scarcity is the stuff of legend by this point and Sony sees an opportunity here, clearly.
That said, the counter-argument here is that Sony made the PS5 profitable incredibly quickly after launch, and now at the first moment when economic forces have caused it to slip, their response is to pass that cost directly onto consumers, which is rubbing some people the wrong way. I can see that argument I suppose, but I’m also not going to exactly see Microsoft as benevolent for not doing this just because they have more money than god to burn.
This is probably not the last time we will see weirdness like this in the industry in these strange times, but it also does not feel entirely out of character for Sony, the champion behind raising its video game prices from $60 to $70 because they simply thought they could. So we’ll see how this plays out over time.
Update: Now Nintendo has issued a fresh comment on how they are also not raising prices, due to inflation or other issues:
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