Console pricing has gone terribly wrong | Opinion

Monster Hunter Wilds is one of the best-selling games of the year – which makes it all the more notable that Capcom president Tsujimoto Haruhiro sees the market position of the PS5 as a significant barrier to the game’s success.

In an interview with Nikkei, Tsujimoto said that the company has found the high price of the PS5 to be a major hurdle for consumers, which has turned out to be a serious obstacle to trying to build out a mass-market franchise like Monster Hunter.

Tsujimoto’s sentiments aren’t uncommon – I’ve heard plenty of industry executives voice concerns about high costs raising the barriers for entry in the console market in recent years.

What’s somewhat remarkable, though, is for such a direct criticism of Sony’s hardware and services pricing strategies to be made openly in a media interview – not least an interview with Nikkei, which is guaranteed to be seen by senior leadership at Sony.

Gaming hardware has never been cheap, per se, and you can certainly make an argument that once you adjust for inflation, launch prices for new consoles are actually quite low these days compared to the eye-watering price points new systems used to launch at. The original PlayStation’s inflation adjusted launch price was over $650; the PS2’s works out at $560.

However, within a matter of a few years those consoles were markedly cheaper thanks to a combination of price cutting and new lower-cost hardware revisions. The PS2 launched at $299 in 2000, but within two years it cost just $199, dropping to $149 – half its original price – after only four years in the market.

The PS5, by contrast, is now more expensive than it was at launch.

It arrived at $499 in 2020; five years later, the RRP is $549. A hardware revision to a slimmer version of the console was not accompanied by a price cut. The digital edition PS5 has had an even more dramatic price bump, rising from $399 at launch to $499 now, with reports suggesting that Sony is also about to try a sneaky “shrinkflation” move by cutting the capacity of the digital edition’s built-in storage.

This change hasn’t happened overnight – the PS4 also didn’t get anything like the extent of the price cutting seen in prior generations, though it did at least get a bit more affordable over its lifespan.

Its impact, though, is very significant, because it radically changes the entire promise of the console ecosystem to developers, publishers, and consumers – and it arguably makes entire classes of game completely commercially unworkable on console platforms.

When Tsujimoto calls out Sony’s pricing as a barrier to Monster Hunter’s success, he’s speaking from a position of keen awareness of precisely how that franchise was built to its current status.

Monster Hunter is a hugely mass-market game in Japan (and it’s getting there overseas as well, especially thanks to the success of World and now Wilds), and it got there essentially by appealing strongly to teenage players who had aged out of Pokémon and leapt on the PSP versions of the game as something to play co-operatively with their friends.

Around the tail end of the 2000s, the phenomenon of Monster Hunter was unavoidable in Japan; every mall food court in the country had at least one table of teenage boys taking down monsters together on their PSPs.

The game now has a significant adult contingent of players, of course (as does Pokémon, for that matter), but those were its roots – and the affordability and accessibility of the PSP platform in the latter years of its lifecycle were fertile soil in which those roots were planted.

That soil now risks becoming entirely barren.

Game consoles holding their pricing year after year, even sometimes seeing price bumps late in their lifespans, is a deeply unsettling trend for a lot of publishers. It means that game consoles (and to some extent PCs, whose hardware costs have soared even more) are being held out of the hands of consumers who lack significant purchasing power, especially children and teens.

These were never the biggest spenders, often being major consumers of second-hand software for cheap late-lifespan console revisions, but that was the industry’s on-ramp.

This was how the next generation of consumers was cultivated and developed, precisely so that years down the line you could have an opportunity to develop and build out a franchise like Monster Hunter for a whole wave of much higher-spending adults with money in their pockets and nostalgia in their hearts.

Kids and teens now turn to smartphones for their gaming needs, because those are the ubiquitous devices they have access to – and the clear risk for the console business is that if that’s where they start engaging, that’s where they’ll stay.

Just as the existence of the “family computer” which could be a reasonably competent gaming machine in its own right was a barrier to consoles in the 1990s, the fact that kids and teens all have a smartphone that’s a pretty competent gaming device in their pockets is a major barrier that’s significantly exacerbated by consoles having such an insanely high cost of entry.

The declining ubiquity of televisions is also a factor here – many teens having a small TV in their bedroom that they could hook up a cheap console to was once a given, but is now rare due to the proliferation of smart devices and collapsing TV viewership among that demographic, which is one of the things that has fuelled the success of the Switch.

Tsujimoto’s praise for the Switch 2 in the same interview is a nod to the fact that out of all of the platform holders, Nintendo is arguably the only one that acts like it’s genuinely concerned about pricing.

“A reconsideration of the value of cheaper, older hardware is one of the most obvious solutions to this problem”

It can’t change the reality of hardware costs, supply and demand, or tariffs, but it’s notable that the company has made a clear decision to subsidise the Switch 2’s Japanese model in order to ensure it remains affordable in that market despite the slide in the value of the Yen.

Nintendo is still pushing for higher software prices, but for all that consumers may wince at the price tag on the new Mario Kart, it makes more sense commercially to try to keep the console affordable – thus keeping the barriers to entry low – and recoup that subsidy from software profits.

For the industry more broadly, a reconsideration of how we think about the value of cheaper, older hardware is one of the most obvious solutions to this problem.

It’s what Nintendo has embraced with Switch, of course, and there’s a strong argument that the existence of the Xbox Series S is the single best strategic move Microsoft made with its hardware in this generation for similar reasons.

Sony’s lack of a similarly cost-competitive PS5 edition hasn’t harmed sales of the console in the first half of its lifecycle, but how it’s going to reach less engaged consumers in the back half of the lifecycle without price cutting is a very serious open question.

Another interesting place to look at older hardware is in the PC market. Comments about the Battlefield 6 beta this week suggested that a large number of players were running the game on PCs below the minimum spec requirements, which should give everyone pause about exactly how we’re thinking about minimum specs in the first place.

As modern hardware prices soar, the value of making games that run on outdated systems is only going to increase.

That could mean focusing on PC games that work well on older hardware (the Steam Deck, incidentally, is serving as a pretty excellent common denominator in the PC market for this reason) – but in the console market, it may also mean maintaining support for previous generations of hardware for much, much longer than used to be the case.

This is especially important for more mass-market games; it’s really notable that entire genres of casual, fun games like dancing, party, and music titles have basically disappeared as console hardware has priced itself out of casual markets.

“If today’s kids and teens aren’t engaging with PlayStation, it’s very unlikely they’ll start doing so as twenty-somethings or thirty-somethings”

Ultimately, though, there’s only so much publishers and creators can do – the solution to this has to come from the platform holder side. This is an existential threat for Sony in the long run – if today’s kids and teens aren’t engaging with PlayStation, it’s very unlikely they’ll start doing so as twenty-somethings or thirty-somethings.

It may be that the entire hardware philosophy of the company needs to shift to focus on affordability – or at least try to strike more of a balance with that requirement, because for all that PS5 has been a commercial success thus far, pricing is one area where the strategy is clearly very wrong both for PlayStation and for many publishers and developers.