Sony has seemingly begun setting expectations for how it plans to handle pricing of its PlayStation hardware going forward. The platform holder has revealed that it does not intend on taking significant hits to profits to absorb some of the ballooning costs of manufacturing hardware.
Sony executives recently held a Q&A session to discuss the company’s Game & Network Services division. The Q&A, which Sony published in English, featured commentary by Sony Interactive Entertainment president and CEO Hideaki Nishino.
Nishino was asked about the company’s stance on hardware pricing and profitability, particularly when it comes to the next generation of PlayStation.
“First, we regard hardware as the base for providing the gaming experience, and by offering products such as the PlayStation Portal Remote Player (PS Portal), we aim to provide experiences tailored to users’ play styles beyond the living room, which has traditionally been considered the primary usage environment,” Nishino began. “As for pricing, it is not realistic for us to absorb all component cost increases, and we have already implemented some price increases outside Japan.”
Indeed, Sony has raised the price of its PlayStation 5 line-up multiple times since its launch in November 2020, with the most recent hike in March. To that end, Nishino revealed that “we do not believe this has led to a decline in customer demand.”
The comment on sales and consumer demand is particularly interesting, as recent data has shown that PS5 hardware sales in the US have reached their lowest point for Sony since May 2000, and suffered a 58 percent decline year-on-year. In the UK, PS5 hardware sales fell sharply during the same month, almost enough for primary competitor, Xbox, to catch up.
So, can we expect more price hikes? The executive didn’t offer a clear answer, but he did intimate that the days of subsidised console hardware are over.
“As a principle, we do not intend to sell hardware at significant losses,” he said. “At the same time, we are carefully monitoring the market and continuing to evaluate our approach. We believe it is important for us to make every effort to ensure that customers fully understand the value we provide in relation to pricing.”
Sony has only briefly addressed its next-generation PlayStation in the past. The company’s official stance has thus far been that it has not yet decided on a price or on when the console is going to launch.
Nishino’s comments, however, indicate that we should expect a very expensive PS6. Just this week, a reliable insider said the cost to build a single PS6 console has risen to be around $960, based on its components alone. This is the result of the AI-driven hunger for high-speed memory and storage, which has multiplied their prices and forced consumer electronic manufacturers to raise their own prices in turn.
