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Why do people believe the PS5 is SO expensive?

RCU005

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Nov 9, 2016
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But the SSD is very expensive, there is no way that thing is cheap!

According to who? Do people have insider information about the deals that Sony do with suppliers about the cost?

When the Xbox Series X specs were announced and said it was a 12TF console, everyone was saying the thing wouldn't cost less that $600 USD. However, they are selling it at $499 (with people even believing that they could cut the price in response to Sony because they showed an ERP).

But Microsoft is so big they can afford to lose more money on each console!
According to who? Do people have insider information about how much money are companies willing to lose on each product they make?

Then, there's the fact that people ignore, which is that EVERY COMPANY that develops a product, they have to design each product based on a target price. They don't make a product out of gold and say, " Oh well, I guess we'll have to sell it at $10,000". They KNOW they need to hit a selling price point, and they need to design the product around that target. If the product goes higher than that, it will only be approved if they are willing to take the loss, they will never allow to build a product with the mindset that they will sell it at a higher price (unless the market allows it).

I'll make sure to edit and add the link when I find it, but there was an interview with Mark Cerny about the PS4 design, and he said that they were set on selling it at $400, and they had to make compromises to make sure they hit that target. Of course it will be the same for the PS5

There is no way that Sony didn't want to limit themselves to a $400. If they approved a $500 console, it's because, like I wrote above, the market allows it. How do they know the market allows it? They spend a lot of money doing market research.

Then, there's the fact that the PS5 Digital Edition exists. If they were willing to do two models, it had to be because they still wanted to hit a target price. If they knew they could go to $500, but still wanted to hit $400, they do a lowered SKU. Why did Microsoft make the Series S? Because they wanted a lower price point, but this time, they needed to lower the specs to hit THAT low of a price point. Sony might be able to take the cost of a Disc Drive.

Another thing that it's important to take into consideration, is that Sony could make a 50TF, 40 GB Ram console and sell it at $3,000 USD. Of course there might be people who says "Wow! 50TF at JUST three thousand dollars? that's a steal!, but is that something that Sony would want as a business? Is that the market they want to be in? The answer is NO!.

The market Sony wants is the market Sony has, and it's 100 million big. They want to keep as much as possible. They know that 100 million people are willing to pay $400 for their console. They are so willing to pay it, that Sony did NOT have any real price cut the entire generation! So, what makes you think they will say " whatever, we will sell the PS5 at $600!"

IMO, the most realistically price point the PS5 can be is $399 for the PPS5 DE and $499 for the PS5. If course they can say "Fuck it! and announce that it will be higher", but of course they haven't done anything that would point they'd do that.
 

diffusionx

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There were reports a while back that Sony was struggling to lower the price of the system and the numbers being thrown around back then was $450 to manufacture. That was about a year ago. When we got the specs, it looked like Sony was going to need a more elaborate cooling system because of faster clocks, and their magic CernyDisk is more bespoke than MS’ solution which means higher cost.
 

Allandor

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Just let's say, the SSD needs 12 flash chips, because of the way they designed it. One chip may be cheap, but 12 ain't.
The high frequencies. Every chip have to reach then with the given power target.
The big box. It wouldn't be so big if they could reduce the size. Every inch are additional costs (they produce millions of those things) . And it can only be so big because of the cooling solution. Because the Mainboard and the soc should quite small.

And there is the waiting game. And their talk about value in the video.

And BTW, I was really surprised by the Xbox pricing. Would also have guessed it would cost 600-700€.
 
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skneogaf

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Ssd and cooling to get such high clock speed plus the controller must be very expensive.

I firmly believe that it was $599 but Microsoft got unlucky with their leaks so it will now be $499 and the digital $450
 
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SlimySnake

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It makes no sense but here we are. the BOM should be lower than the xsx but like i said, it hasnt stopped these rumors.

maybe sony spread these rumors themselves to throw MS off. maybe MS spread these rumors to spread some more FUD about the ps5. who knows at this point. its been an insane gen with github leaks and all that nonsense with insiders.

what we do know is that the ps5 bom is higher than what sony anticipated. the bloomberg article had sources within sony saying the ps5 bom is $450. $70 higher than the ps4. but the author of that article also pegged the ps5 price point at $470 cheaper than the xsx.

it seems what happened is that sony was aiming for $399 but the dram and nand prices did not fall as they anticipated. but that also affects MS so its all nonsense.
 

jshackles

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It's just wishful thinking by anti-Sony fanboys lol.
Not just anti-Sony fanboys though. I've seen quite a few posts of people saying that if the PS5 is more expensive, it's because it's the better console / has the better SSD / has the better exclusives / is worth paying more.
 
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Three

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I have expectations of $599 if they choose not to take a loss. Beats the rumoured $700 anyway.

If it is cheaper then that is only good news to me. I'm not setting myself up for disappointment.
 

Jose92

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People Keep saying the SSD is going to be expensive, but the SSD NAND chips used in the ps5 are slower than the ssd xbox series x/s, because of the inherent design more parallel i.e. 12 channels at once. While xbox using less channels faster chips.

The part which is more expensive on the ps5 side of things is the SSD controller where it has bespoke and advanced features. But the price difference of the controller won't be more than $ difference between the two.

The PS5 cooling solution wont be more than several $ in price.

The Soc yields shouldn't be any worse than xbox series x's yields. one is higher frequancy which would reduce yields and the other is larger gpu which means more soc area needed i.e less usable chips per wafer.

I cant see a situation where the bom of the PS5 is more than the Xbox Series X. The bill of material typically doesnt include incurred R&D costs.
 
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RCU005

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And there is the waiting game. And their talk about value in the video.

Value doesn't necessarily mean "too expensive". They also talked about how they want to move people to PS5 at a faster pace than ever. They wouldn't be able to do that with a much higher price.

I firmly believe that it was $599 but Microsoft got unlucky with their leaks so it will now be $499 and the digital $450

I have expectations of $599 if they choose not to take a loss. Beats the rumoured $700 anyway.

What makes you think that Sony would want to design and build a $600+ console? The price point is the first thing that's decided when starting ANY project.
 

Three

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Value doesn't necessarily mean "too expensive". They also talked about how they want to move people to PS5 at a faster pace than ever. They wouldn't be able to do that with a much higher price.





What makes you think that Sony would want to design and build a $600+ console? The price point is the first thing that's decided when starting ANY project.
Mainly because we have some issues with NAND and GDDR6 prices because of COVID. They have an expensive SSD. It depends entirely on how they ordered these parts. I hope they did it well.
 

Entroyp

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I have expectations of $599 if they choose not to take a loss. Beats the rumoured $700 anyway.

If it is cheaper then that is only good news to me. I'm not setting myself up for disappointment.

What rumored $700?
 

Kenpachii

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High clock GPU that probably has yield issue's, Fast SSD that don't come cheap.

That's why.

Another thing that it's important to take into consideration, is that Sony could make a 50TF, 40 GB Ram console and sell it at $3,000 USD. Of course there might be people who says "Wow! 50TF at JUST three thousand dollars? that's a steal!, but is that something that Sony would want as a business? Is that the market they want to be in? The answer is NO!.

And that's why i stated after the released specs that sony's next console is a mess even while everybody is praising it. It's way overenginered and costs way to much to produce which will result in a higher price and less sales and a smaller market as result.
 
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Kuranghi

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RCU005

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What people? It's all speculation, you are shouting at the situation which we don't have...

There's many Youtube videos and articles about how they think the PS5 couldn't be lower than $500. The rumors that "Sony is changing price in response to Microsoft" -which there is a thread already- it's just FUD because of people thinking that the price of the PS5 has to be much higher.

Mainly because we have some issues with NAND and GDDR6 prices because of COVID. They have an expensive SSD.

Expensive to consumers, doesn't have to mean expensive for Sony. They make deals that include the purchase of millions of parts. Also, many deals should have been made way before COVID, so probably won't be affected (price-wise).
 
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JonnyMP3

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Concern trolling at its finest. Attempt to make the competition appear worse than your product... This is why Xbox has such a job on its hands and the FUD and rumours about the PS5 are so rampant.
But the only real way for Xbox to gain back such strong marketshare is for Sony to once again shoot themselves in the foot like they did during the PS360 era.
 

Esppiral

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The industrial design of the ps5 looks quite expensive and those controllers too.
 

Toaster man

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Microsoft is losing money on the Xbox series X. They priced it very aggressively to compete with sony who has an edge right now.

Thats why i think some think the PS5 could be go higher. If you look at online polls and market observers, they all indicate there is much higher interest in the PS5 than the xbox. This would theoretically mean sony could go higher and and take a smaller loss on each console sold, but that is just in theory. In reality the second sony goes higher than series x they will be raked over the coals by people online. Sony will match 499.99 imo. It is too risky not to.

They wont go lower. If you look at the market place there is no incentive to. They have way more interest than microsoft. So matching Microsoft will be enough.
 

Entroyp

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Any links with info about the correlation of frequency and yields? I worked at a semi manufacturing company 15 years ago and I might have missed something back then...
 

Three

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Expensive to consumers, doesn't have to mean expensive for Sony. They make deals that include the purchase of millions of parts. Also, many deals should have been made way before COVID, so probably won't be affected (price-wise).

Yeah this is what I hope.
 

protonion

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You cannot write a tweet/article saying "I have no idea what the ps5 costs" can you?

So they go with the unpleasant scenario to get clicks, comments.
Whatever happens they get their traffic and most readers/viewers have short memory so no loss for them.

Also extremely few people know what each vendor charges Sony.
I've worked at invoicing and if this info went out we would be killed.
 

slade

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Because MS went to the Bulk Barn and got lots of deals and can stand to lose money. Sony obviously didn't and can't. They are struggling to sell anything else not named PS or an insurance plan.

Seriously though, all of what you read is conjecture. It might turn out to be true but less then 5 percent is coming from an informed position.
 

NoMoChokeSJ

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Retail 1TB PCIE4 SSD is about $200. R&D make up costs too. I wouldn't be surprised if it is more expensive than the xbox.
 

MoistPenetration

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because they clearly went for a more premium design, plus they spent a lot more money than MS on developing a new controller. MS is going cheap becuase they only care about getting more gamepass subs
 

prinz_valium

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Because the console is huge and because the cooling is new and expensive (especially for Sony, coming from super cheap and basic in the PS4)
The SSD is using a 12 channel SSD meaning they need 12 NAND chips (stacked or not, but they need 12), while Microsoft is just 4.
The controller and other IO chips are custom, while Microsoft is using of the self stuff.
The SOC is running at unreal frequencies, so they either have worse yield than running at 400MHz less, or they designed it with more headroom in mind which would result in a bigger SOC.
The SOC is rumored to have all the IO stuff and Southbridge also on die and not sperate like the Series X
The controller is not basic. It's new and more complex tech. That costs money, too.


Do you need more reasons, why people believe the PS5 is expensive?
 
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Ar¢tos

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There were reports a while back that Sony was struggling to lower the price of the system and the numbers being thrown around back then was $450 to manufacture. That was about a year ago. When we got the specs, it looked like Sony was going to need a more elaborate cooling system because of faster clocks, and their magic CernyDisk is more bespoke than MS’ solution which means higher cost.
But since then Sony doubled production to 10m for launch quarter, doubling the order will certainly lower price per unit, and the cooling, while more expensive than basic fans, they said it's not crazy expensive.
 
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Slings and Arrows

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Away with the fairies
Because the ONE time Microsoft and Sony were neck and neck, was because the PS3 was way more expensive.


(the 360 still lost the gen)
It lost in sales and in the end it lost in mind-share because they dropped the ball. Overall though? The 360 was the better console to play games on, even if the PS3 had better features.