How to sell next-gen consoles, Marketing, Positioning, and Pricing [2020]

[Daozang]

Thanks for the info, it makes more sense now!
I don't get this part though,

So the same speed SSD as SeriesX but pulling in resources at 25% the size may result with faster loading than even the PS5.

Are you assuming it will be streaming lower quality assets?
Or is it I'm missing something very basic?!
Because in my mind, a 4K texture is a 4K texture, even if the final render is a lot smaller than what the X/5 will have to output.

QFT.

PC gamers are totally okay with paying anywhere between 500-1500 for a GPU alone. 3080TI I suspect is going to land in the upper 1600s possibly.

When I look at the specs, honestly I can't see these consoles being that cheap. 599 is a steal, 699 is a steal, even 799 is ok when you consider what's inside both of them. But I thin the market is going to struggle with any price point above 499. It's really a weird situation. Gaming is a really weird industry where traditionally their customers are unwilling to accept price increases regardless of YoY inflation.

Well...
I agree that the pricing rumors are weird, in the sense that 499 sounds very cheap.
But gaming targets a mass market, and pricing a console above a threshold will cripple sales.
The PS3 was a testament to this.
Even in the GPU space, high prices will essentially shape high end PC gaming into a smaller niche than it already is.
Pascal was priced exceptionally, although the relation of supply-demand was ultimately screwed because of crypto mining.
As for Turing, I'm guessing nVidia needed to cover R&D costs somehow.

 

[steveOrino]

Physically based rendering, made a huge difference in games.
In my opinion, PBR and volumetrics, are the two most important real time techniques that changed graphics in games in the last few years.
Every time a new generation of hardware is introduced, we see a leap in graphics fidelity.
Framerates and resolution can be brute forced with faster and more powerful hardware.
Anyone of us that owns a gaming PC can attest to that.
But a true leap, comes when first party developers can use a new powerful system, and third party developers can develop a game from the ground up to harness the potential of those new powerful systems.
And us PC gamers can rationalize the expense of a new GPU.

Agree with PBR and Volumes but imo getting rid of the rest of the lighting inconstancies will be the next leap. Shadowmaps need to go away and with so many open ended games, real time indirect lighting needs to improve.

I am a cranky old PC gamer, I know.
But getting a new generation of consoles, only to see the same tech cranked up to 11 due to sheer brute force, because the damn game needs to run on a potato, is a shocking first, and a disheartening first at that.
Playing Halo 3 at 1440p 144hz, is pleasant, but in no way is it impressive.

PC has been my primary gaming platform since the late 90s but graphics have never really been a driver for me in investing in the platform. It was freedom of tailoring a game to my tastes and the the sheer variety of game genres that just aren't available on set-top consoles. With the cost of game development homogenizing everything there has been less and less incentive for me to even look at a console. So the incentive boils down to when enough interesting exclusives hit a platform that justifies the hardware tax I have to pay to access the library. This time around I will say at least PS5 entire forward looking storage system really caught my eye in the hardware sense because they are offering something I can't really buy on a PC atm and has great potential to offer new gameplay design opportunities as well as potential to match older masked rom base consoles in the "instant on" respect. I will be interested to see how their 1st party studios harness that capability.

At least MS finally came to their senses and stopped totally neglecting the core platform they shouldn't have abandoned in the first place so they could chase Sony for a market that slapped both of them in the face

 

[goonergaz]

Well By now I'm pretty sure that the number 1 reason we still don't know the price only 2-3 months before launch (allegedly?) is because these beasts are not going to be cheap. And by that, I mean that I fully expect them to breach the 499 barrier, and both MS and Sony are scared sh!tless about that. If that weren't the case, then they would have come out already a while ago with their 499's or whatever they can come up with. My opinion of course.

So we might get £499 in the UK, which would probably be $599 in the US (GBP 499 GBP = USD 650 today). Which is fine by me, but when the news cycle this month is about how deep this "deepest ever recession" is (-20% of GDP here in the UK for example), then I can understand why they are pussyfooting around this one last detail.

I just can't see £500 in the UK unless that's the non digital edition. I've always expected the price to increase from this gen but £350 to £500 is pretty insane. I can see £400/450 for the digital and £500 for the main one. I can't see the point of the digital if it's just £50 cheaper - makes no sense other than asthetics because £50 saving is not worth it to save money due to digital prices.

 

[Deleted member 11852]

How do you think the delay of Halo Infinite? In US PS5 has Spider Man for launch, but XsX now has no comparable exclusive games after Halo delay.

Halo and Spider-Man aren't really comparable Halo Infinite is playable on the Xbox you own now, Spider-Man needs a significant chunk of change investment to play it.

Halo's delay is bitter sweet, it's Halo so I want to play it, but I want it to be the best it can be as well.

 

[London Geezer]

I just can't see £500 in the UK unless that's the non digital edition. I've always expected the price to increase from this gen but £350 to £500 is pretty insane. I can see £400/450 for the digital and £500 for the main one. I can't see the point of the digital if it's just £50 cheaper - makes no sense other than asthetics because £50 saving is not worth it to save money due to digital prices.

Yep that’s what I meant. £499 which would make it $599-ish in the US. Digital a little less but not £100 less.

 

[Xbat]

I believe at least one of the next gen consoles will be heavily subsidized.

 

[iroboto]

How do you think the delay of Halo Infinite?

In US PS5 has Spider Man for launch, but XsX now has no comparable exclusive games after Halo delay.

I think MS is praying 5G comes out faster lol.
But seriously, yea. That would change fortunes favour for them.

 

[Arwin]

I believe at least one of the next gen consoles will be heavily subsidized.

This isn’t likely. I don’t think any company has done that in, what, several generations? It can only work when you are then guaranteed to recoup that investment and that is very risky. Instead at best you will see minimal margins on the hardware.

 

[goonergaz]

Yep that’s what I meant. £499 which would make it $599-ish in the US. Digital a little less but not £100 less.

It depends why the digital version exisits, I put it that I would gladly pay more for a digital version with double the SSD size. But if it's to get closer to the XSS price then a simple 50 off isn't going to cut it.

I can't think anyone who is price sensitive will walk into a shop (or go online) and "save" 50 to then pay more for every game they buy from that point. It makes no sense to me. 100 I can get, because you know long term it'll hit you but for 100 you can get ~2 games, so at least you're off and running.

 

[Xbat]

This isn’t likely. I don’t think any company has done that in, what, several generations? It can only work when you are then guaranteed to recoup that investment and that is very risky. Instead at best you will see minimal margins on the hardware.

How isn't it more viable than ever before?

 

[AlphaWolf]

How isn't it more viable than ever before?

Pandemic. And costs do not decline as quickly or greatly now as they did in the past.

 

[Silenti]

...

I wouldn't get your hopes up. Some of the price predictions being thrown around are ludicrously out of touch with reality.

The highs or the lows are unrealistic?

Well By now I'm pretty sure that the number 1 reason we still don't know the price only 2-3 months before launch (allegedly?) is because these beasts are not going to be cheap. And by that, I mean that I fully expect them to breach the 499 barrier, and both MS and Sony are scared sh!tless about that. If that weren't the case, then they would have come out already a while ago with their 499's or whatever they can come up with. My opinion of course.

So we might get £499 in the UK, which would probably be $599 in the US (GBP 499 GBP = USD 650 today). Which is fine by me, but when the news cycle this month is about how deep this "deepest ever recession" is (-20% of GDP here in the UK for example), then I can understand why they are pussyfooting around this one last detail.

And well they should be. There would be some serious sticker shock involved. Going from $400 base (PS4) to a projected $600 ... I am imagining cartoonish dropped jaws and rueful laughter. Anything beyond $500 is a complete non-starter for me. I have a busted PS4 and a second hand RX580. If the price is beyond $500 I will just continue as I am. I am now tempted to ask around and see what people I know think about that. (Just for curiosity. Obviously not statistically relevant.) As obviously, I cannot prove anything. Over $500 just seems stunning to me.

Interestingly, that may play in to MS's hands in a way. If Xcloud is doing well enough, I am on a low-latency fiber connection. Maybe just get GP Ultimate and ignore the consoles till the prices are more realistic? I really thought the debate was more about $400 with good yields and some subsidy, up to $500 (with the $449.99 actually being possible). DF's discussion seemed unrealistic. Guess I will just shake my head and wait like everyone else.

 

[London Geezer]

Hey, we have been very wrong in the past! I'm just frustrated by the wait. Can't take it anymore.

 

[Xbat]

Pandemic. And costs do not decline as quickly or greatly now as they did in the past.

The problems of the costs going down could be a problem but if anything the pandemic should be more of an incentive to come in at a lower price.

The amount of money being made by the "Network" dwarfs what was ever made by previous consoles that used the razor and blades business model.

PS4 made more profit in 2018 than PS2 made over 6 years.

For me they either take a hit on hardware or invest massively in buying or expanding there devs. I think they will do both but price is critical to build momentum even more so now in the pandemic.

I believe getting people to buy your hardware is still the best way to get them to use your "network".

 

[Deleted member 13524]

On this note however, I'm not sure if the 'pro' models would be at a reasonable price point by any margin.

The PS5 SoC, if it's on the 300-350 mm^2, then on TSMC's 5nm it should be lower than 200mm^2 which isn't a very large SoC (hence not very expensive either). Sony could also go with a multi-chip approach on both the PS5 Lite (single-GPU) and the PS5 Pro (dual-GPU), by making e.g. a CPU+I/O chiplet that then connects to one or two GPU+MCU chiplets.


Using HBM2E would indeed pose a problem for cost, but we should expect HBM to ramp up eventually, and this isn't the only option they have.
In reality if they went with GDDR6 we'd not be looking at one SoCwith a 512bit bus. We'd be looking at two SoCs with a 256bit bus each which should be a lot easier to implement in a PCB since we wouldn't have 16 memory chips competing with access to the same SoC.

 

[AlphaWolf]

The problems of the costs going down could be a problem but if anything the pandemic should be more of an incentive to come in at a lower price.

The amount of money being made by the "Network" dwarfs what was ever made by previous consoles that used the razor and blades business model.

PS4 made more profit in 2018 than PS2 made over 6 years.

For me they either take a hit on hardware or invest massively in buying or expanding there devs. I think they will do both but price is critical to build momentum even more so now in the pandemic.

I believe getting people to buy your hardware is still the best way to get them to use your "network".

They can't use the network with their ps4 or xbox one?

5ish million people are going to buy a ps5 or xsx in its first quarter. Taking losses won't change that much.

I think $600 would have a negative impact, but I doubt they will get much resistance at $500. And they will have lower priced versions for the price conscious. After the first quarter they can add some bundle deals.

 

[Xbat]

But Sony is apperantly prepping 10 million PS5s to be shipped by the end of March 2021 which means they probably want to have 20 million plus by March 2022 probably much more I would imagine.

The big spenders aren't going to be playing PS4 or Xbox one next year.

 

[Johnny Awesome]

I'm still betting PS5 and XSX are $499 at launch. They will sell everything they can make at that price. XSS will be $299 IMO. Not sure if it will come out in 2020.

 

[Unknown Soldier]

I'm still betting PS5 and XSX are $499 at launch. They will sell everything they can make at that price. XSS will be $299 IMO. Not sure if it will come out in 2020.

I can see the PS5 and XBSX selling for $499 and the PS5DE for $450. I however think the XBSS would then sell at $350 minimum(maybe $400).

 

[Silenti]

I can see the PS5 and XBSX selling for $499 and the PS5DE for $450. I however think the XBSS would then sell at $350 minimum(maybe $400).

That XBSS price feels far from compelling. At that point I would expect even fanboys to be looking hard at a PS5.