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It's crazy that amidst this cost saving, Sony is still going forward with the price increase in some markets.
by Aissen 4y ago
It's crazy that amidst this cost saving, Sony is still going forward with the price increase in some markets.
- nerdawson 4y agoCost of living increases primarily affect day-to-day spending while a PS5 is a luxury purchase. If you can’t afford it at the new price, it probably wouldn’t have been a wise purchase at the original price. Sony is a business. Their costs have gone up markedly and when the hardware is already subsidised, it’s unrealistic to not expect increased costs to be passed on.
- Waterluvian 4y agoI’m actually surprised how long prices stayed put despite a mismatch between supply and demand. Any time there’s a vibrant scalping market, your prices are too low.
- ajmurmann 4y agoFor this reason I always thought Sony and Nvidia should just auction off their products initially till the auction price is barely above the floor price/planned retail price. Just let the market do its thing and take the profit instead of giving it to scalpers and inconveniencing everyone in the process
- Waterluvian 4y agoAnother alternative is that they sell them first Party (probably a non-option because storefronts would probably throw a fit). And instead of first come first serve, simply have a queue.
- ajmurmann 4y agoQueue or lottery would work. That's actually how Nike (used to?) sell limited edition sneakers. They either had a lottery or queue depending on demand or something. Leaves money on the table though and still leaves room for scalpers.
- Waterluvian 4y agoI would have preferred that. I bought mine from a scalper with a third of the warranty gone before it was out of the box. Would have preferred to get it from Sony.
- wmf 4y agoBut instead of hating scalpers, then customers would hate Sony and Nvidia.
- asteroidbelt 4y agoSony could be smart, for example keep existing price as is, but also offering “premium” version for higher price but with delivery this week. This would kill scalpers.
- lozenge 4y agoNintendo did this, the Switch was out of stock consistently, unless you bought it in a "bundle". A lot of the bundles were 12 months of the Online service, so basically easy profit.
- christoph 4y agoPeople here saying the PS5 should have dropped in price, I just checked Amazon for the price of a new Nintendo Switch (standard model, not OLED), seems almost identical to what I paid for one on launch day. £250. This is now really old hardware that launched over 5 years ago (Mar 2017).
- Aissen 4y agoThis "standard model" had a SoC refresh too. And as said elsewhere in the thread, it's now cheaper in USD (how components are priced) than it was when GBP was at 1.30+.
- Aissen 4y agoPS5s are relatively easy to buy in bundles; if you're lucky you'll have a game you wanted, except at list price instead of market price, but most of the time you'll have useless overpriced accessories and average games. In fact, Sony is encouraging the practice, and makes it harder for resellers to not do this.
- ajmurmann 4y ago
- colechristensen 4y agoI’ve thought the right thing to do would be to put up ~10% of production to auction to take revenue from scalpers.
- chippiewill 4y agoSony will have already factored in the cost saving over the entire lifespan of the product. I recall that the original Playstation 3 was a massive loss leader. Despite being hugely expensive it was pretty much the cheapest Blu Ray player on the market at the time. They were able to sell it at a loss because gaining a foothold was critical to selling it for a profit later on and the projected savings would let them recoup their losses. If cost of living and inflation weren't crazy right now across the world then I'm sure we'd be looking at a price drop on the Playstation 5 right now as that's where their projected margins would leave them. But factoring in both the cost savings and inflation means they still need a price rise just to keep on track.
- alias_neo 4y agoPS3 wasn't particularly reliable for me (anecdotal). I still have my PSP 1000, PS (Grey rectangular one, not the later "One"), PS2 Satin Silver was sold years ago, PS4 was given away when I got PS5, all launch day purchases; I went through 3 PS3s in its lifetime.
- ethbr0 4y agoSame with the PS2 as a DVD player. People forget there was a time when DVD players weren't cheap.
- paulmd 4y agoI mean, it's a readjustment to local currency values - otherwise they're selling the PS5 for 20% less in EU markets than in US markets. At some point it becomes worth it to buy a container of hardware and turn it around and sell it in the US as "grey market" and that's value that Sony wants to capture for themselves. Even allowing software to be sold at different prices in different countries already has far more financial ramifications than people expect - the grey market seriously impacts the profitability of sales in high-earning countries, and it fosters a whole black-market of cdkeys that are purchased using stolen cards/etc and used for money laundering. But with hardware it is a very straightforward "this costs $X to R&D and $Y to build and we're not going to sell it to you for 20% less than everyone else", you're seeing the grey market die out even in traditional strongholds like cameras. Also, PS5 is a console designed around hardware profitability. They reached profitability around 6-9 months after launch and they don't want to go backward. Everyone finally said enough is enough after PS3 losing hundreds of dollars per console, and the PS4 and XB1 are much more conservative designs with integrated hardware to cut costs, and they reached profitability fairly quickly. PS5 succeeds this and Sony absolutely does not want to go back to the "loss-leader hardware" model. Prices are sticky, companies don't always want to adjust them every time $FXE has a bad week, but... Sony isn't interested in selling to multiple major markets at a discount that pushes their hardware into the "subsidized" territory. And they've been down for a while now. For everyone else, their cost-reduction in the console itself has been sufficient to hold the price down, but you don't get a discount like you normally would a couple years into the lifecycle. But for the markets where there have been big currency depreciations on top... they are adjusting it.
- jonas21 4y agoIn other words, Sony isn't charging more (in dollars). Your euro/pound/yen is just worth less than it was a year ago. https://www.google.com/finance/quote/EUR-USD?comparison=JPY-USD%2CGBP-USD&window=1Y https://www.google.com/finance/quote/EUR-USD?comparison=JPY-...
- dkersten 4y agoGoing by the current EUR/USD price, from your link, they are charging more. They're overcharging by about $33. To make the Euro price be on par with the USD price, they would have to charge 515 euro, not 550.
- hatware 4y ago> It's crazy It took me 18 months for the chance to buy one from Sony Direct. It'd be crazy for Sony not to adjust prices when demand is through the roof.
- synicalx 4y agoIf they're selling out everywhere still, after years, I guess it makes sense to try especially with costs rising. Their subscription model is way less mature than Xbox's as well so they need to rely less on that to turn a profit.