Because that nets Sony an extra $150/unit (assuming Best Buy pays 1/2 the unit price). But Sony's customers feel cheated. Customers can handle not getting a uni

Because that nets Sony an extra $150/unit (assuming Best Buy pays 1/2 the unit price). But Sony's customers feel cheated. Customers can handle not getting a unit via a "fair" practice, but they resent the rich explicitly getting better treatment for things like that. Also, they cannot plan a budget. Right now, if you have $500 you have a PS5 eventually. In your world, they buy an Xbox or spend it on something else because they don't want to keep saving and getting priced out. But keep in mind consoles are all network effects, and the real money is on subscriptions and commissions on games. So, Sony gets a one time pop in revenue, fewer units lead to fewer exclusives, leads to more people selecting XBox in the future. I think MS was willing to lose a billion on the first Xbox to get sufficient traction. If we discount inflation entirely and assume that was a reasonable value, Sony would have to sell 6.67 million units to be equal to the cost of losing a console war. And they could always end up pulling a Sega.