The PlayStation 5 is due to be released during the Holiday 2020 season, and facts about the system have slowly been unveiled by Sony through press releases and interviews. What is still unclear is how much the system will cost at launch. Microsoft and Sony still have another year to prepare for the launch of their next systems, so the initial price likely won't be discussed until mid-2020.
There have been many console launches over the years and it's possible to try and predict the future costs of systems based on previous facts and information regarding hardware. The PlayStation 5 is entering an incredibly busy marketplace and its launch price could spell the difference between failure and success.
The New Features Of The System
Sony has released some details about the PlayStation 5, but not all of the hardware specifications are known at the time of writing.
The PlayStation 5 will include a custom SSD for storage and will use AMD's Ryzen with the 7 nm Zen 2 architecture with 8 cores/16 threads. It will come with a Radeon Navi-family GPU using the RDNA microarchitecture, which includes support for real-time ray-tracing rendering. The system will support 100GB Blu-ray discs and 4K Blu-ray video. The controllers will have haptic feedback and adaptive triggers.
On the surface, it seems that the PlayStation 5 will be an expensive piece of kit at launch based on the hardware alone. It wouldn't be the first time that Sony took a hit on hardware costs in order to make money on sales of the software, but it's unclear if it will be willing to do that with their next console, considering the strength of its position in the market.
The History Of PlayStation Launch Prices
The original PlayStation had a memorable moment when it came to its launch price. It happened during the first E3 event and followed the announcement of the Sega Saturn launching at $399. The Sony representative got up on the stage and said "$299", which immediately put the Sega Saturn on the back foot.
The PlayStation 2 also launched at $299, which was seen by many at the time as a tremendous bargain. The PlayStation 2 was released at a time when DVD players were still expensive items. The fact that the PlayStation 2 had a built-in DVD player was seen as a huge benefit by many and was one of the factors in the system becoming the best-selling video game console of all time.
Sony dropped the ball with the PlayStation 3, as the 20GB model was $499 at launch and the 60GB model was $599. Microsoft made the most of the situation, as the Xbox 360 launched for $299 a year earlier. Sony misjudged the marketplace and it took a long time to start winning back the audience from Microsoft. The steep price point and the lack of a single killer feature are what killed it at release, as the built-in Blu-ray support didn't mean much at a time when HD TVs were still exorbitantly expensive.
The PlayStation 4 cost $399 at launch and it would go on to be the best-selling console of its generation, sitting at over ninety million units sold worldwide.
The Customers Are Savvy When It Comes To Launch Consoles
The trickiest aspect of gauging the price of a console launch is the consumers themselves, as there have been enough console releases in the past that fans have wised up to the realities of buying one of at launch.
It makes the least logical sense to purchase a new console at launch, as they will be at their most expensive and will only have a small library of games. The ability to patch the system firmware means that features can take a while to be added to a console and might not necessarily be there at launch.
A large contingent of the audience knows that it's wiser to wait at least a year to purchase a new console, as there will either be a price reduction or a bundle deal that comes with a good game. Any issues involving the online functionality will have been sorted, any unforeseen glitches will have been fixed, and missing features will have had time to be implemented.
A console needs an absolutely killer app to be worth it on day one, which turned out to be The Legend of Zelda: Breath of the Wild for the Nintendo Switch, as the Nintendo Wii U version was almost an afterthought compared to a portable version of one of the biggest and most gorgeous games of its generation. Microsoft and Sony will need something on that level to convince people to shell out for a console at launch, especially in this day and age where there is so much competition from the mobile and PC gaming market.
The Verdict
History has shown that consoles are more likely to succeed when they launch at a price between $299 and $399. There is simply too much competition on the marketplace to justify raising it any higher, especially if the upcoming Google Stadia works as promised. Sony has been blinded by its dominant position in the market in the past and the high hardware cost of the system means that it might consider launching the PlayStation 5 at $499 or even $599, which would doom the console for its first year of release.
It seems likely that Sony would launch the PlayStation 5 at $399 in order to try and win that initial 2020 holiday season. It's possible that Microsoft could prompt Sony to go higher or lower depending on the initial price of the Xbox Scarlett, as the company would easily take a $50 price cut just to try and get the edge over the competition.