Could 9th gen consoles be $500 USD?

[dten]

We have a tech discussion of next gen consoles, but what about a business discussion? Assuming current inflation rates remain the same, $400 in 2013 would be about $450 in 2020. If new consoles are released at that time or later, could we see it at $500 USD? And in a related matter, could games be $70+ USD next generation? A couple of things to consider.

• I start with a premise that the XBox One X and PS4/PS4 Pro and to a lesser extent XBox One are putting the best technology the console makers can put in their prices. Don't expect more for less in the future. What would a $400 XBox One X look like? Maybe less RAM, no Hovis and thus lower Ghz?
• Now that the public and developers have a taste for multiple console hardware levels, the possibility is feasible. Base is a GTX 1060 level and the high end is a 1080 for example purposes. I doubt two tier will happen but just throwing it out there.
• Kind of a weird idea, but if 9th gen consoles are a continuation of current consoles (i.e. cross compatible games) it might not be as important to sell as many units quickly out of the gate. In previous generations, early games depended on a growing install base. So 9th gen consoles can be made and sold as a high end machine, negating the point above.
• DRAM prices remain high though we can't predict how it will look in the future of course.

 

[AlNom]

Only with two tiers.

 

[iroboto]

I expect a $499 price point (or a long wait for next gen), otherwise you're not going to be able to get too far away from the mid-gen consoles.

That's not a terrible thing of course, if you platform has removed traditional generation model, you just choose when you want to upgrade, you can skip this one and catch the next one. This doesn't mean there won't be exclusives. This just means that the platform isn't forcing developers to cut off the older generation to support the new one.

If the generation is reset, and you don't have a large difference over the mid gen refresh, it's going to feel extremely shoddy that you would be forced to reset your hardware for a marginal improvement over mid-gen.

For these reasons combined, I am expecting a $499 console.

 

[DrJay24]

I would expect a $399/$499 combo. $499 alone is too out of the mainstream. I know first adopters will always buy anything, but those people dry up kind of fast. I suppose you could have a $499 price for year one and quickly drop to $399 (if the BOM price permits), but that kind of pisses off first adopters.

 

[bunge]

Seems like Sony might be in a better position to do it. Early adopters wouldn’t mind the price and the PS4 appears to be selling well enough to the masses. Instead of abandoning the previous generation they’ll be enabling a newer generation a bit sooner.

Why? The same PS5 arrives a year earlier without undermining the PS4. Why wait another year to introduce the same hardware at $399?

 

[BRiT]

If you go multi-tier I'd expect more of a $299 / $499 split.

 

[Pixel]

More than ever its financially viable to sell their consoles at a $100 loss (at a $400 launch price). Eg $500 BOM sold at $400.

With the move to digital distribution don't both Sony and MS significantly increase the revenue get from the sale of 3rd party games? With physical they get a royalty, with their digital distribution platform they get a 30% cut. Fact: They also get a cut of microtransaction/dlc revenue in 3rd party games, yes they do.

Also Gold & Plus membership has only increased.

 

[Scott_Arm]

Unless that extra $100 brings miraculously better performance/graphics, I'd say the $399 price point will be the winner. I think there will be significant diminishing returns on console computing power to perceived visuals next gen.

 

[Pixel]

Unless that extra $100 brings miraculously better performance/graphics, I'd say the $399 price point will be the winner. I think there will be significant diminishing returns on console computing power to perceived visuals next gen.

It potentially can. In a $400 console only ~$250 goes into the cpu & gpu & memory & cooling. $100 more lets you put in $350 into cpu & gpu & memory & cooling. A 40% higher budget for the silicon heart of the system.

That + plus one year of 16nm finfet fabrication improvement is like jumping from PS4 PRO to XOX. 40% more powerful gpu, 50% more ram, 40% higher memory bandwidth (384bit bus).
If you eliminate the 1 year of processes node improvement and just look at what $500 BOM could have done in 2016 for the PRO, for the PS4 PRO they did consider the 5.5TFLOP system, likely with more memory bandwidth achieved through a wider bus (perhaps a 320 bit), but rejected it in favor of the cheaper $400 priced system we see today.

 

[function]

I agree with those saying $500 only makes sense if you have two tiers - effectively what MS are already experimenting with.

For MS the next low tier could reasonably be a shrunk X1X with half width (GDDR6) bus. It should get there naturally around 2020. For Sony, I'm not sure the Pro is quite "enough" to fill the role, so they'd need two new systems.

Launching two systems simultaneously, globally, would be very challenging. Messaging would be tricky initially as simultaneously launching two systems would be new. Launch titles would be under additional development pressure. I expect both tiers would share the same CPU at identical or almost identical frequencies - GPU power and memory quantity and bandwidth would be the main differentiators.

I think Sony might be better off launching just a single new system at $400 / $450, and really nailing that like they did this gen. 256-bit bus, 16 GB RAM, ~12 TF. Big differentiator would be a massively uprated Zen CPU. Big early selling point might be that it can do all the PS4/X1X targeting games at 4K 60 fps with better effects and textures. But it'll still use a fucking 5400 rpm laptop HDD.

 

[Gubbi]

Having different main SOCs would be a bad idea. You get smaller economies of scale cost efficiency, resulting in a more expensive system than otherwise. Your developers have to design for two different configurations, which means a bigger burden on developers and lower quality games for the higher tier console than otherwise.

There are plenty of options to cost reduce various SKUs:
1. $349; Arcade system; 150GB flash (assuming $.25/GB), no optical drive, no HDD
2. $399; Arcade+, 150GB flash, optical drive, no HDD
3. $399; Arcade++, 150GB flash no optical, 2TB HDD
4. $449; Premium, 150GB (or more) flash, optical, 2TB HDD.

Allow external storage options (USB-c connceted). SKUs 1 and 3 would likely be loss leaders, but made up by a slight profit on 2 and 4.

Cheers

 

[Scott_Arm]

It potentially can. In a $400 console only ~$250 goes into the cpu & gpu & memory & cooling. $100 more lets you put in $350 into cpu & gpu & memory & cooling. A 40% higher budget for the silicon heart of the system.

That + plus one year of 16nm finfet fabrication improvement is like jumping from PS4 PRO to XOX. 40% more powerful gpu, 50% more ram, 40% higher memory bandwidth (384bit bus).
If you eliminate the 1 year of processes node improvement and just look at what $500 BOM could have done in 2016 for the PRO, for the PS4 PRO they did consider the 5.5TFLOP system, likely with more memory bandwidth achieved through a wider bus (perhaps a 320 bit), but rejected it in favor of the cheaper $400 priced system we see today.

I'm still not that convinced. I know that on paper the differences could be significant, but that's what I mean about diminishing returns in perceived visuals. It takes a greater and greater disparity in performance to realize significant differences in perceived visuals.

 

[Globalisateur]

Yes, I can't see how next gen could be less than $449

It potentially can. In a $400 console only ~$250 goes into the cpu & gpu & memory & cooling. $100 more lets you put in $350 into cpu & gpu & memory & cooling. A 40% higher budget for the silicon heart of the system.

That + plus one year of 16nm finfet fabrication improvement is like jumping from PS4 PRO to XOX. 40% more powerful gpu, 50% more ram, 40% higher memory bandwidth (384bit bus).
If you eliminate the 1 year of processes node improvement and just look at what $500 BOM could have done in 2016 for the PRO, for the PS4 PRO they did consider the 5.5TFLOP system, likely with more memory bandwidth achieved through a wider bus (perhaps a 320 bit), but rejected it in favor of the cheaper $400 priced system we see today.

Because in the end they probably thought:

5.5Tlops is not worth the cost if we can only use a 2013 Jaguar CPU (even clocked a bit higher than on Pro).

 

[dten]

I'm still not that convinced. I know that on paper the differences could be significant, but that's what I mean about diminishing returns in perceived visuals. It takes a greater and greater disparity in performance to realize significant differences in perceived visuals.

Keep in mind that with inflation, a $400 console in 2020 will have a harder time matching the BOM of a $400 console in 2013 unless they are willing to take a bigger loss.

I think console manufacturers will not release a new machine until they can target modern games to run at 4K in most cases. If devs say it takes 10 TF and 700 GB/s bus with a much better CPU, that is what they'll shoot for. Part of it is marketing so they can say a "true 4K experience" or whatever. Whether that makes a big perceptible difference is tbd.

 

[Scott_Arm]

Keep in mind that with inflation, a $400 console in 2020 will have a harder time matching the BOM of a $400 console in 2013 unless they are willing to take a bigger loss.

I think console manufacturers will not release a new machine until they can target modern games to run at 4K in most cases. If devs say it takes 10 TF and 700 GB/s bus with a much better CPU, that is what they'll shoot for. Part of it is marketing so they can say a "true 4K experience" or whatever. Whether that makes a big perceptible difference is tbd.

True, but people don't spend their money based on that logic. I would be surprised if most people's earnings have kept up with inflation. $400 will still probably be a sweet spot price, and $500 will still be a tough sell unless there is some significant perceived value, not just value on paper. There is a "good enough" level for most people who play games.

 

[DrJay24]

I'm still not that convinced. I know that on paper the differences could be significant, but that's what I mean about diminishing returns in perceived visuals. It takes a greater and greater disparity in performance to realize significant differences in perceived visuals.

Which is why they should focus on something other than the number of pixels. At 8'-10' away from a 65" TV, I'm not going to want smaller and smaller pixels. Give me new rendering methods, better lighting, better physics and AI and better frame rates. I would have more than happy with 1080P for a few mote years, but they need to sell more TVs and the hype and marketing has pushed the arms race.

 

[dten]

Which is why they should focus on something other than the number of pixels. At 8'-10' away from a 65" TV, I'm not going to want smaller and smaller pixels. Give me new rendering methods, better lighting, better physics and AI and better frame rates. I would have more than happy with 1080P for a few mote years, but they need to sell more TVs and the hype and marketing has pushed the arms race.

I don't want to go too far in analogies but if you look at smart phone cameras and screens each year, you'll barely notice the resolution bumps but the companies blow it up (figuratively) in their marketing and many people eat it up even though they probably can't tell the difference in most use cases. I agree that 1800p for instance basically gives you the same experience as 4K but from a marketing perspective, they've got to have a hook for selling new hardware and the true 4K experience seems like the easiest path. I'd personally be more excited to see a more capable CPU but how often do you see 60 fps in an advertisement vs 4K, 4K, 4K?

Also from above, two tiers that change HDD sizes and ports have been common. Releasing two tiers that change in game experiences has never been done. These mid gens are doing that now but years apart. Which two tiers are people talking about?

 

[dobwal]

I can see $500 consoles. The XB1 was initially $500 and sold three million at launch dealing with a more popular and cheaper competitor that was more powerful performance wise.

I doubt the PS4 sales trajectory would have been that much different if it had started at a $500 price point.

I can see both MS and Sony repackaging the XBX and the Pro with new form factors under a XB2 and PS5 badge. It's commonly done in gpu land and makes marketing easier to the mainstream while allowing older hardware to fill a new role in a new gen without the negative connotations that the older branding might carry.

 

[Scott_Arm]

I'm not convinced that sites like Digital Foundry have any impact on overall sales. Without sites like DF, I doubt the small percentage of gamers that follow the site would even be able to identify the differences between games on consoles. This is especially true now that we have things like temporal AA, temporal reconstruction. Aliasing is far less of an issue than it's been in the past, which means games can scale resolution to regain performance without large impact to perceived visual quality. And at resolutions like 4k scaling down, the pixels are becoming so small that scaling is far less noticeable than at lower resolutions. Now we're mostly talking about perceived "softness" vs shimmering and aliasing. So whatever consoles come next, they'll probably take advantage of dynamic resolution, and one will stick closer to 4k than the other, but mostly image quality will be roughly similar with only sharpness/softness being the perceived differences. In that circumstance, I think a $400 console wins over a $500 console. Brand loyalty, console lock-in, game library will probably be bigger price justifiers than performance. Unless for some reason one runs games at 60fps and the other is locked at 30fps, but I think that's unlikely.

 

[DrJay24]

I can see $500 consoles. The XB1 was initially $500 and sold three million at launch dealing with a more popular and cheaper competitor that was more powerful performance wise.

I doubt the PS4 sales trajectory would have been that much different if it had started at a $500 price point.

Maybe in the first year, but right now it would have been $299 instead of $199.

I can see both MS and Sony repackaging the XBX and the Pro with new form factors under a XB2 and PS5 badge.

Sony is going to repackage the PS4 Pro and sell it for $500? I'm not following. The PS5 will be a new beast and will likely be BC with PS4. Same will true for the Xbox.