Sony Says It No Longer Needs To 'Aggressively Sell' The PS5 - Kotaku
The recent, colossal price increases for the PS5 have marked the first time the console has gone up in price during its lifetime. When the WSJ asked about the difference between Sony and Nintendo, with the latter launching its new console in the midst of the crisis, Totoki explained, “It is lucky, you know. We are in the latter half of the lifetime cycle of a PS console.
With the PS6 unlikely to appear before 2028, you might imagine Sony would be in the business of trying to shift as many PS5s as it can. But newer Sony CEO Hiroki Totoki has a very different perspective, as revealed during an interview with The Wall Street Journal. He seems quite happy with the 125 million people currently registered with PS Plus, and is putting the focus on how to get those established customers to spend more money.
The recent, colossal price increases for the PS5 have marked the first time the console has gone up in price during its lifetime. Thanks to the component crisis and AI arms race, the PlayStation 5 now costs 30 percent more than it did at its launch in 2020, and that’s obviously going to slow sales. But Hiroki Totoki, president and CEO of Sony for just over a year, confidently believes this happened late enough in the machine’s life-cycle not to be detrimental to profits. When the WSJ asked about the difference between Sony and Nintendo, with the latter launching its new console in the midst of the crisis, Totoki explained, “It is lucky, you know. We are in the latter half of the lifetime cycle of a PS console. That means that we do not need to aggressively sell the console today.”
“The latter half” is perhaps putting it mildly. New PlayStations have previously come out every six or seven years, meaning we’d usually be in the console’s final moments. However, thanks in part to a slowing of fidelity improvements in PC tech and to the deeper capability of the current tech as shown off via the recent GTA 6 footage, the PS5 doesn’t feel like a console on its last legs, giving Sony a lot more room before it needs to figure out how to produce a PS6 for under $1000. This, says Totoki, allows the company the opportunity to push not the machine, but rather its current customers. “We’re focusing on recurring revenue from the current user base,” he told WSJ. “Already, PS Plus has more than 125 million [monthly active users], and how to monetize from those users is quite important for us.”
Assuming the median PS Plus price of $16.99, that’s revenue of over $2.1 billion a month from already-sold PS5s, so yeah, you can see his point. Add to that the 30-percent share of any third-party PS5 game sales, and the 100 percent share of first-party sales, especially as the company aggressively cuts out retail with its digital-first (and soon to be only) approach, and that’s an awful lot of people giving Sony an awful lot of money. Selling more PS5s for—at the best—break-even prices increases that base, certainly, but doing so doesn’t need to be a priority.
The interview is, sadly, a complete softball PR schmooze so there’s no follow-up to this, no pushing for how this monetization will take place (further PS Plus price increases?), and certainly not even an attempt to ask about a PS6 window.
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