Sony allegedly 'struggling' to keep PlayStation 5 price down. What's it mean for Xbox Series X?

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Short supply and high prices of DRAM may force Sony to raise prices, but Microsoft may not have the same problem. Still, market uncertainties exist, and questions remain.

Xbox Series X 3D render
Xbox Series X 3D render (Image credit: Windows Central )

What you need to know

  • PlayStation 5 pricing may be higher than expected.
  • Tight supply of DRAM is causing headaches for Sony.
  • Xbox Series X may not have the same issue, but uncertainty remains.

Bloomberg Technology claims Sony is running into some manufacturing issues with the forthcoming PlayStation 5. The reporting cites "scare components" as the issue, resulting in a significant push in costs for the next-gen gaming console.

The problem is a familiar one. Sony is supposedly having a tough time securing reasonable prices on a reliable supply of DRAM and NAND flash memory. It's so bad that Sony also reportedly canceled some new features for a mirrorless camera due to the DRAM supply problem (just three companies manufacture 98 percent of the world's supply).

The reason is simple: smartphones. Samsung's latest Galaxy S20 lineup is massive, and its specs have only gone up in recent years, cutting into the same supply that game consoles use. Apple can't be dismissed from this either, as that company is notorious for locking up supply components early and fast due to its size, influence, and position in the market.

Bloomberg Technology adds that some other costs for the PlayStation 5 that are already locked in, including a more expensive than usual cooling system.

With the PlayStation 5 reportedly costing $450 per unit, the reporting suggests a $470 price tag for the console to maintain a similar gross margin to PlayStation 4. That older unit supposedly costs just $381 to make and sells for $399, making Sony's latest significantly more expensive. Kotaku sees that pricing as even more dire for the Australian market after shipping and distribution costs are factored in.

Playstation logo

Source: Sony (Image credit: Source: Sony)

Surprisingly, there is no mention of Microsoft and its Xbox Series X console in this reporting. Microsoft's console also uses many high-end components, and its price is not expected to be as low as the One X or One S, which remain as options for consumers. Indeed, one report says that Series X's SSD may actually be DRAM-less – a first in this market – which could help Microsoft skirt this supply issue, at least partially. The solution for Microsoft, which is unconfirmed, is the reliance on Phison's newer PS5019-E19T flash memory controller.

At XO19 last year, head of Xbox Phil Spencer remarked, "I would say a learning from the Xbox One generation is we will not be out of position on power or price," suggesting the company has thought long and hard about this topic. Confirming this, recent reporting suggests Microsoft has added support for next-gen CFExpress SSD cards for easy, fast (and pricey) storage expansion.

Nonetheless, as electronics, smartphones, laptops, gaming consoles, and even smart cars begin to suck up more silicon, it's not known what impact this will have on Series X pricing. Many tech companies – including Microsoft – also are factoring in the COVID-19 Coronavirus outbreak into quarterly guidance for investors (NVIDIA did the same on February 13).

How Sony copes with its supply problems could be a big deal, especially if the company must sell "at cost," which undercuts margins. Microsoft doesn't seem to be concerned, though, as so far, we have not heard anything dire. How the pricing shakes out between the two gaming behemoths will be fascinating to watch.

Xbox Series X/S

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Daniel Rubino
Daniel Rubino

Daniel Rubino is the Executive Editor of Windows Central, head reviewer, podcast co-host, and analyst. He has been covering Microsoft here since 2007, back when this site was called WMExperts (and later Windows Phone Central). His interests include Windows, Microsoft Surface, laptops, next-gen computing, and arguing with people on the internet.
33 Comments
  • Won't matter at the end of the day. It's an expensive hardware that is now dwarf'd by the price mobile phones.
    Add the fact that fans are, by the very name, a fanatic means that they'll buy it anyway and make excuses to why.
    I don't think it'd be long before Sony fans will be celebrating it costing more because it's got better exclusives, or the hardware is better quality/faster etc. The excuses will come thick and fast and they'll be happy with the purchase.
  • Agreed if it helps play games better than why not get it people build 3k gaming rigs without batting an eye it was bound to happen that console prices would start creeping up on that price.
  • It doesn't have to be an excuse. Look at budget gaming PCs, they are at least $600 for a self build and usually $800+ for a brand. Why wouldn't consoles start creeping their way to the budget PC scale when smartphones have already topped some PC prices?
  • Simon, first of all, you still don't know the price.
    The things you call excuses are what most console gamers want. They don't celebrate a high price, it's not a branded wearable/phone. Seems to me that you just don't like the fact that Sony sold more consoles than Microsoft. That may change when Xbox becomes better at games, and when they start putting an effort at supporting other regions.
  • Part of those sales also have to do with availability in various countries, too. Countries like Japan and China have played a huge factor in those numbers. It's not about the hardware, at this point. Games and exclusive games that cater to the core of gamers has been one of a few issues Microsoft has yet to overcome for those countries. Additionally, Xbox just doesn't have the same support Playstation has there. Barely any marketing there for Xbox.
  • Xbox One X was $499 at the beginning so if Xbox Series X would be at same price range, it would be ok. PS4 pro was $399 at the beginning so if PS5 would sell at $450+, it would be a challenge. I think that's why the source only consider PS5.
  • Pretty sure you won't see anything below 499 at launch
  • Won't matter because Phil Spencer is a toad that screwed up the Xbox platform forever. People don't care about more power, if it means fewer exclusive titles.
  • Eh.. Get your facts right toad.. Phil Spencer didn't lead the launch of Xbox One.
  • I think you're the one who need to get your facts right. The guy never claimed that Spencer led the launch of XB1.
    He was however head of XB for most of the generation and a high executive the remaining time. He also did work on the XB1 since 2008...
  • He's referring to the first 1-2 years comment that MS will make their first half a dozen exclusives or so playable on Xbox One hardware. To be honest we don't know what PS5 exclusives Sony has. At the moment most people are expecting the PS5 launch to have PS4 games upgraded and repackaged. Like TLOU2, Ghosts Of Tushima among others. All these titles are playable on PS4. So let's see what the other studios might have ready for PS5 if at all. Don't expect anything from Polyphony. They take on average 6 years to develop each game after the 3rd iteration of GT. I would say the only real exclusive will be whatever Gurilla Games is working on. All their other main studios releases PS4 ganes in the last 2 years. And Sony devs take longer than 2 years to develop their games. I wouldn't expect anything form Sony Santa Monica in the first year either.
  • But I thought we didn't care about exclusives, no one around here cares about Xbox exclusives.
  • A couple of comments:
    1. Forever is a very long length of time. Not sure that is a strong bet, let alone appropriately measurable.
    2. Name calling is kind of unprofessional and somewhat undermines your point of view
    3. You are a consumer, so place your vote with your buying power.
    4. Investment in game development is a multi year return. Certainly Microsoft did not invest correctly or make ideal choices in the early years of xbox one gen. However, there has been a clear change in strategy in the most recent few years, evidenced by games pass, studio acquisitions, a new studio, games pass ultimate, organisational structure changes at Microsoft promoting xbox to the leadership group and by what appears to be a very powerful new console on the horizon.
    5. Seriously guys, watch some Super Rugby. It is an excellent game that I think you will enjoy.
  • Sorry, how long have you played games for? You don’t remember Xbox one not quite being able to produce 1080p On certain games at launch (before the S and X )? Or PS4 at launch out doing Xbox one graphically at launch? The one x sold very well because people wanted more power. Not only that - but Xbox acquired how many studios?
  • Sony is being squeezed by both Lockhart and Anaconda. they have to price below the Xbox Series X because it's a lower performance device, but they need to price high enough to not take a bath on costs. Microsoft doesn't really have to worry as much because they'll have a lower priced model so they have some freedom to go high on the X for the high end gamers.
  • The other issue is, Sony doesn't make a lot of profits in other areas. PS is pretty much their everything, these days. Xbox is an afterthought at MS. And if they felt there was a good business rationale for doing so (for instance, looking ahead to conquer the game streaming market), they could subsidize it indefinitely. MS can afford to take a bath on game consoles; Sony can't. Indeed, if I were MS, after the first year or so of Xbox sales, I'd start offering "Buy a top of the line surface (say 2K+) and get a free Xbox." Take a huge hit up front, but get a whole slew of new Surface and Xbox loyalists to whom you can sell expensive subscriptions.
  • Well it used to be an afterthought. Phil Spencer changed that. And now reports directly to Satya. Xbox used to come under other umbrellas for funding. But now Xbox under Phil has its own funding and branch. Phil can now get things signed off directly from Satya. Making Xbox a prominent business under MS.
  • Yeah I read this on other gaming sites. Sony seems to be in a bit of a pickle at the minute. Execs can't decide between them what to do. And their cost of production is only 450 as far as putting the console together. That doesn't include marketing controller etc as some other sites have pointed out. I said a couple of months ago something didn't feel right about PS5 info leading up to the new Gen. And reports suggest it's a tough launch for Sony. I said before, MS seem to be making all the right headlines. And Sony seem to be struggling. First power, and now this. This statement isn't good considering we are supposed to be 8 months from launch. "Some Sony games staff think it should sell the new console at a loss if necessary to match Microsoft’s price, while other Sony executives would prefer to make money as the company did with the PS4,"
  • So Richard, are you going to buy a PS5 or stick to XB only?
    Did you buy or play many games outside of the XB ecosystem?
  • I certainly have no intention in the first few years to get a PS5. I have owned all Playstation consoles so far. PS3 and 4 I got much later into the cycle though. Only for a few exclusives. I was waiting for GOW 4 to get a PS4. Although the remake is a good game for the 3rd person crowd. I was very disappointed it wasn't a hack n slash game like the rest of the series. GOW3 is my all time fave PS exclusive.
  • So you bought the PS4 just for the exclusives? Did you buy 3rd party games? What about steam or GOG, Epic or other non-MS platform?
  • Don't use steam. I have a Switch and a Wii U. I'm currnelty building a PC to use Ultimate Gamepass. All multiats I buy on One X. Best versions
  • So why did you buy the Switch? Do you play anything besides Nintendo's exclusives? Do you use it outside? Also "best versions" isn't quite true because 'best' is subjective. But if you are referring to the version with higher framerate/resolution at the highest visual than that version should be PC.
  • I have 3 children as well. So Nintendo was mainly for them. But I do play Ninty games. I actually grew up a huge Nintendo fan. They used to be a very grown up console provider. The N64 had some serious adult games on it. And they always pushed for best graphics. When they stopped pushing tech for visuals and adult games, I switched more to Playstation. Then Xbox got me hooked on Halo. Yes in terms of console games, One X versions nearly always have better framerate and better resolution. And sometimes better fidelity versions of 3rd party titles. No I don't use Switch outside. I only game at home.
  • Ah ok, got it. So the Switch/Wii U is mainly for the children.
    I would think that they wouldalso use the XB because the console also has it's fair share of games for children. Games like Lucky's tale or Ori.
    Or Hollow Knight? So you played Hollow Knight on Nintendo console?
  • Well it's kinda more like my eldest daughter asked for a Switch for Xmas. The Wii U is for the the family. Lots of cheap great Nintendo games. Have 3 Xbox consoles. One X in thr living room. One S in my daughter's room who has the switch. And the original Xbox in my 2 younger kids room, they share. I have Gamepass for myself and share with my eldest daughters Xbox. PS4 is really mine. Noone else uses it. It's only really on when I play any PS exclusives. Last one being God Of War.
  • Jeez, 20 questions much?
  • @Sin
    Why not? For once Richard and me aren't having a heated discussion?
    Would you rather see us going at it like usual? :D
  • I mean, if I had the choice... obviously going at it like usual.
  • Lol honesty is the best policy
  • This development is not surprising.
  • News flash. The Xbox Series X is going to be expensive to Mr. writer...
  • Series X should be multiple spec configs at different price points in same looking case.
    Maybe modular so you could lift up the shell and install more ram or better hd later.