Sony has announced a price increase for the PlayStation 5 in a number of markets. This decision was made public by the company earlier today, citing the current challenging global economic environment and rising inflation as the primary reasons. The tech giant is raising the price of the PlayStation 5 in most of the world, including Europe, Africa, the Middle East, Latin America, and even North America, but not the United States.
The price increases, which range from $20 to $80, are effective immediately everywhere but Japan, where they won't be felt until September 15.
|Market||PS5 Standard Edition (old price)||PS5 Standard Edition (new price)||PS5 Digital Edition (old price)||PS5 Digital Edition (new price)|
|Canada||CAD $629.99||CAD $649.99||CAD $499.99||CAD $519.99|
|Australia||AUD $749.95||AUD $799.95||AUD $599.95||AUD $649.95|
|Mexico||MXN $13,999||MXN $14,999||MXN $11,499||MXN $12,499|
“The global economic environment is a challenge that many of you around the world are no doubt experiencing,” said Jim Ryan, President and CEO of Sony Interactive Entertainment. “We're seeing high global inflation rates, as well as adverse currency trends, impacting consumers and creating pressure on many industries.”
Ryan says that Sony felt it had no choice but to raise prices in the face of these intensifying competitive threats. This may be especially true for video game consoles, which often sell below cost for quite some time after their initial release. Game manufacturers recoup some of their losses by marketing add-ons, games, subscriptions, and even discontinued console models.
A little over a year ago, Sony began making a profit on sales of the base model PlayStation 5, while the Digital Edition continued to sell at a loss. Meanwhile, Sony has sold roughly 20 million PlayStation 4 consoles in the past three years (March 2019 – March 2022). These consoles are based on older technology and are very cost efficient to produce.
Thankfully for Sony, the demand for its consoles has not decreased and the chip shortage is ending. Company officials have stated a desire to fix the PlayStation 5 supply problem, and it stands to reason that easing demand for graphics DRAM and NAND chips, among other types of silicon, will do the trick.
Despite a significant slowdown in both hardware and software sales, neither Microsoft nor Nintendo have announced plans to increase the price of their respective console lines.
As Nintendo president Shuntaro Furukawa explained to Nikkei earlier this month, the company has no intention of pricing people out of buying their best-selling console ever.
Sony's decision may help Sony's competitors in the coming months, but that remains to be seen. Last quarter, consumers cut back on their spending on video games by 13%, but the PlayStation 5 was the industry's top moneymaker.
Tesla, Intel, Meta, and a slew of laptop manufacturers have all announced price increases for their flagship products in recent months, with some already in effect.