5 ms·

> Has there ever been a console where, over the life of the console, the hardware was sold for a loss? All of them. Speaking about PS5 specifically: there's q

by dijit 4y ago

> Has there ever been a console where, over the life of the console, the hardware was sold for a loss? All of them. Speaking about PS5 specifically: there's quite a few advancements in there that you're not thinking about, the kraken decompressor that can run at native NVME speed in hardware and load assets directly into video memory has no PC equivalent. Though PC vendors are trying to do NVME<->GPUMem these days, it still can't do effectively 9GBit like the PS5 can (theoretically). Even ignoring those architectural advantages and the R&D; last time someone did a cost comparison of an equivelant PC (a year ago) it was $1,600: https://gamerant.com/ps5-specs-pc/ https://gamerant.com/ps5-specs-pc/

zeroonetwothree 4y ago
The article says the $1600 PC has “double the graphical power”. Consoles are certainly a good deal at the low end of gaming. If you want high framerates and resolution they won’t do it for you.
- dijit 4y ago
  People buying consoles are not buying them for epic frame-rates or 8k resolutions.. I bought my console because I absolutely despise Windows, and despite being a gamedev myself I cannot convince other gamedevs to work as linux for a target. Even then, the amount of effort fighting my operating system and the spotty support you would get (even on windows) is troubling.. because PC's generally are running a complicated workload at varying degrees of state. I buy a console game, it's going to work and if it doesn't I'm going to get my money back. My time is too precious to waste on excessive debugging to access entertainment. Ironically the PS4's insane update sizes and slow storage adapter nearly caused me to go over to PC.. So it doesn't always work, admittedly. By "double the graphical power" you mean it has more compute units, not the clock speed, memory or bandwidth, which tend to be more important in my experience.
- threeseed 4y ago
  4K and 120Hz are available on a number of games at least on PS5. Most people don't have TVs that can go any higher.
latexr 4y ago
> All of them. It’s my understanding that’s not (always?) true for Nintendo consoles. The Switch makes a profit on hardware[1] and that was a goal before launch[2]. [1]: https://www.tweaktown.com/news/79180/xboxes-arent-profitable-but-the-nintendo-switch-certainly-is/index.html https://www.tweaktown.com/news/79180/xboxes-arent-profitable... [2]: https://venturebeat.com/2016/10/26/nintendo-wont-sell-switch-at-a-loss-plans-to-ship-2-million-units-in-march/ https://venturebeat.com/2016/10/26/nintendo-wont-sell-switch...
- dijit 4y ago
  That's extremely interesting and I didn't know it. Conventional wisdom dictates that consoles sell at a loss.
  - dwaite 4y ago
    It is an urban legend that all consoles are sold at a loss. Some manufacturers, in creating an appealing multi-year technology platform, might temporarily sell at a loss. The PS 5 for example was reported to sell at a loss for the first three months. Secondly, a reporting that a console is sold 'at a loss' initially may be talking console development, initial tooling, and partner contracts for custom parts in account. They may not be speaking of raw manufacturing costs for individual unit parts and labor.
  - robotnikman 4y ago
    It was the same with the Wii as well iirc, it shared a lot of components with the Gamecube.
criddell 4y ago
>> Has there ever been a console where, over the life of the console, the hardware was sold for a loss? > All of them. Are you serious? The Wii has sold more than 100 million units over the past ten years and you think it's been a net loss for Nintendo? PS5-to-PC comparisons are hard to do in a meaningful way. It's like saying a Toyota Camry is sold at a loss because if you build one part-by-part it's going to cost $100,000+ rather than the $30k a dealer sells them for. If you take those PC specs and contact a manufacturer with a plan to order 20 million units, they are going to come in at quite a bit under $1600.
- dijit 4y ago
  I mean, it's conventional wisdom that Consoles are the _poster child_ for what "Loss Leader" means. https://www.makeuseof.com/games-consoles-sold-at-loss/ https://www.makeuseof.com/games-consoles-sold-at-loss/
  - criddell 4y ago
    The first run may very well be sold at a loss, but almost every console has eventually turned a profit. I say almost because the XBox 360 may have been unprofitable over it's entire manufacturing run due to extraordinary warranty costs (red ring of death). I've read that it may have cost Microsoft more than a billion dollars, but I don't know if that's true or if that was enough to net Microsoft a loss over the 11 years it was sold.
  - musicale 4y ago
    Conventional wisdom is not universally accurate in this case.
- threeseed 4y ago
  Sony in particular does this. For the first X years of its life, Playstation is sold as a loss. They generate revenue through game sales and then a decade later as hardware components become cheaper and scale increases they start to make money on the consoles as well. If they can't generate revenue through game sales the entire console model would be upended and hardware prices would rapidly increase. No company can take the risk to lose billions without a guarantee of future revenue.
InitialLastName 4y ago
The differences between the PS5 and an equivalent PC build from components account for substantial improvements in price/unit; your article doesn't include an actual price breakdown so it is difficult to call out exactly where the costs come from, but: - Tightly integrated motherboard, designed and built in-house, including the CPU, GPU (integrated to CPU), RAM and comms removes a bunch of middlemen, with all of their testing, development and integration costs (which add substantial overhead on a home-built PC). - Thanks to the above, thermal and power management get a lot easier, which reduces power and cooling costs. - Economies of scale and long life-cycle planning let you make large orders of parts (at Sony's scale, economies where the manufacturer is producing to your demand) at lower unit costs, including manufacturing large numbers of custom parts (such as the case and power supply) with design features that minimize cost (rather than allowing home assembly). I wouldn't be shocked if any given part for the PS-5 were getting manufactured in quantities an order of magnitude greater than any of the SKUs in the comparison PC.

by dijit 4y ago

zeroonetwothree 4y ago

The article says the $1600 PC has “double the graphical power”. Consoles are certainly a good deal at the low end of gaming. If you want high framerates and resolution they won’t do it for you.

dijit 4y ago
People buying consoles are not buying them for epic frame-rates or 8k resolutions.. I bought my console because I absolutely despise Windows, and despite being a gamedev myself I cannot convince other gamedevs to work as linux for a target. Even then, the amount of effort fighting my operating system and the spotty support you would get (even on windows) is troubling.. because PC's generally are running a complicated workload at varying degrees of state. I buy a console game, it's going to work and if it doesn't I'm going to get my money back. My time is too precious to waste on excessive debugging to access entertainment. Ironically the PS4's insane update sizes and slow storage adapter nearly caused me to go over to PC.. So it doesn't always work, admittedly. By "double the graphical power" you mean it has more compute units, not the clock speed, memory or bandwidth, which tend to be more important in my experience.
threeseed 4y ago
4K and 120Hz are available on a number of games at least on PS5. Most people don't have TVs that can go any higher.

latexr 4y ago

> All of them. It’s my understanding that’s not (always?) true for Nintendo consoles. The Switch makes a profit on hardware[1] and that was a goal before launch[2]. [1]: https://www.tweaktown.com/news/79180/xboxes-arent-profitable-but-the-nintendo-switch-certainly-is/index.html https://www.tweaktown.com/news/79180/xboxes-arent-profitable... [2]: https://venturebeat.com/2016/10/26/nintendo-wont-sell-switch-at-a-loss-plans-to-ship-2-million-units-in-march/ https://venturebeat.com/2016/10/26/nintendo-wont-sell-switch...

dijit 4y ago
That's extremely interesting and I didn't know it. Conventional wisdom dictates that consoles sell at a loss.
- dwaite 4y ago
  It is an urban legend that all consoles are sold at a loss. Some manufacturers, in creating an appealing multi-year technology platform, might temporarily sell at a loss. The PS 5 for example was reported to sell at a loss for the first three months. Secondly, a reporting that a console is sold 'at a loss' initially may be talking console development, initial tooling, and partner contracts for custom parts in account. They may not be speaking of raw manufacturing costs for individual unit parts and labor.
- robotnikman 4y ago
  It was the same with the Wii as well iirc, it shared a lot of components with the Gamecube.

criddell 4y ago

>> Has there ever been a console where, over the life of the console, the hardware was sold for a loss? > All of them. Are you serious? The Wii has sold more than 100 million units over the past ten years and you think it's been a net loss for Nintendo? PS5-to-PC comparisons are hard to do in a meaningful way. It's like saying a Toyota Camry is sold at a loss because if you build one part-by-part it's going to cost $100,000+ rather than the $30k a dealer sells them for. If you take those PC specs and contact a manufacturer with a plan to order 20 million units, they are going to come in at quite a bit under $1600.

dijit 4y ago
I mean, it's conventional wisdom that Consoles are the _poster child_ for what "Loss Leader" means. https://www.makeuseof.com/games-consoles-sold-at-loss/ https://www.makeuseof.com/games-consoles-sold-at-loss/
- criddell 4y ago
  The first run may very well be sold at a loss, but almost every console has eventually turned a profit. I say almost because the XBox 360 may have been unprofitable over it's entire manufacturing run due to extraordinary warranty costs (red ring of death). I've read that it may have cost Microsoft more than a billion dollars, but I don't know if that's true or if that was enough to net Microsoft a loss over the 11 years it was sold.
- musicale 4y ago
  Conventional wisdom is not universally accurate in this case.
threeseed 4y ago
Sony in particular does this. For the first X years of its life, Playstation is sold as a loss. They generate revenue through game sales and then a decade later as hardware components become cheaper and scale increases they start to make money on the consoles as well. If they can't generate revenue through game sales the entire console model would be upended and hardware prices would rapidly increase. No company can take the risk to lose billions without a guarantee of future revenue.

InitialLastName 4y ago

The differences between the PS5 and an equivalent PC build from components account for substantial improvements in price/unit; your article doesn't include an actual price breakdown so it is difficult to call out exactly where the costs come from, but: - Tightly integrated motherboard, designed and built in-house, including the CPU, GPU (integrated to CPU), RAM and comms removes a bunch of middlemen, with all of their testing, development and integration costs (which add substantial overhead on a home-built PC). - Thanks to the above, thermal and power management get a lot easier, which reduces power and cooling costs. - Economies of scale and long life-cycle planning let you make large orders of parts (at Sony's scale, economies where the manufacturer is producing to your demand) at lower unit costs, including manufacturing large numbers of custom parts (such as the case and power supply) with design features that minimize cost (rather than allowing home assembly). I wouldn't be shocked if any given part for the PS-5 were getting manufactured in quantities an order of magnitude greater than any of the SKUs in the comparison PC.