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News section > Consumer Electronics

New Gaming Console War Features Some Common Enemies

2020-06-17 Editor:Super administratorSource:https://www.wsj.com/articles/new-gaming-console-war-features-some-common-enemies-11592139601


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The coming Sony PlayStation 5. Sony and Microsoft are wrestling with how to launch their new videogame consoles in an economy under strain from coronavirus.

A new videogame console war is taking shape. But this time, Sony SNE -0.54% and Microsoft MSFT 2.45% have more to worry about than just each other.

New PlayStation and Xbox consoles are definitely coming—despite the disruption the coronavirus pandemic has wrought on consumer-electronics manufacturing. Sony confirmed fall launch plans for its PlayStation 5 in a virtual event Thursday that showcased new games for the device as well as the new console design. Microsoft confirmed a fall launch for the Xbox Series X in a blog post the day before.

Neither company has put out a price tag for the new machines yet. Past consoles have launched in the range of $400 to $500, though the new devices offer some substantial upgrades in processing power, storage and technologies such as ray tracing—which produces much more realistic images. But this generation of consoles also faces a harsh global economic backdrop relative to past cycles. Record unemployment rates aren’t exactly conducive to selling high-price machines when cheaper options abound. A current Xbox from Microsoft can be had right now for as little as $200.

That creates a conundrum for both companies as they figure out how to launch their machines. In an interview with BBC published June 8, Microsoft’s Xbox chief Phil Spencer acknowledged the “massive economic uncertainty” accompanied by job furloughs and layoffs. “So we want to be really tuned in to that as we launch,” he said. “How can we make it as affordable as possible? How can we give buyers choice?”

billionPlayStation 4 launch2010'11'12'13'14'15'16'17'18'19'200.02.55.07.510.012.515.017.520.0$22.52020x$18.38 billion

That is the right approach, especially considering that the true profits in gaming are in the games themselves and related services, rather than the hardware. But the game industry as a whole may be facing a production crunch, since the lockdowns related to the pandemic have forced most game developers to work at home in the crucial months ahead of their fall release targets.SIGN UP

New games also are key to selling new consoles. Sony announced 28 game titles at its event Thursday, but would only confirm that most would be in the “launch window” of the PlayStation 5, which is generally defined as the first four to five months a new console is on the market. Microsoft last month highlighted 13 launch-window games, though is widely expected to have “Halo Infinite” from that blockbuster franchise ready when the Xbox Series X hits the market.

Both Sony and Microsoft also have to contend with a gaming business that has shifted to free-to-play multiplayer titles such as “Fortnite” and “Apex Legends.” Those games don’t require the most high-end consoles; they are in fact popular precisely for their ability to draw a massive audience across a variety of platforms. In this console war, getting the pricing right will be only half the battle.


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