Sony isn’t cutting PS4 Pro price because they don’t need to
Plus, it’s still $100 less than Xbox One X
Besides talking about a successor to PlayStation VR, Shu Yoshida, President of Worldwide Studios, touched on what many had speculated would take place during the PlayStation E3 2017 press conference — a price cut for PS4 Pro.
While some imagined the price dropping to $379 or perhaps $349, others were more bold in their predictions, thinking we could see PS4 Pro at $299.
With the press conference well over now, we of course know how much Sony opted to drop its powerful console price by — an astonishing $0. Shu on the topic:
Is it too expensive? [Feedback so far from owners is] really, really positive.
People are very, very happy [with PS4 Pro], so we don’t have any plans to change [the price].
Price drops have often been a big defensive move that takes place within the gaming industry but it seems like the industry, if not Sony, is begining to wise up to them. Make no mistake, there is a time and place for price drops and I’m not here to argue that PS4 Pro should forever stay at $399. After all, eventually the console will be outdated and its price tag should drop to indicate that, but 6 months in is just crazy.
But let’s look at a few different reasons why we’re not seeing dramatic price cuts.
Sony can’t afford to
It’s no secret that PlayStation is single handedly responsible for helping Sony get back on track. Only a handful of divisions within Sony are making money and those that are were losing billions the years prior and have only turned over small increments of profits in recent quarters. That means every dollar Sony can make from its PlayStation business is a dollar that will help the company stabilize its other businesses and anything they can do to extract as much money possible from PlayStation is exactly what they’ll do.
Xbox One X price
If Xbox One X had been priced at $399, Sony (though doubtful) could have had a segment ready during their press conference to announce a price cut but with a price tag that’s $100 more, there’s still a big difference between the two consoles.
With each console being 4K HDR capable, it may come down to the price for gamers and parents looking to make a purchase and at that point, a $100 or $150 price difference would result in the same outcome — them walking away with a PS4 Pro. In that scenario, why should Sony lose out on $50 on each console sold? For those even more price conscious, they can opt for the PS4 which recently did receive a price cut and is down to $249.
They don’t have to
Perhaps the biggest and simplest reason why there was no PS4 Pro price cut is because Sony doesn’t have to. You don’t hear this talked about too often but it’s crazy how far ahead of the pack PlayStation is compared to Xbox. The last time we heard sales numbers from Microsoft was well over two years ago and many speculate Xbox One sales passing 26 million units sold this year where PS4 just crossed the 60 million marker.
People are buying PS4 in droves and there’s no sign of a slowdown, so why should Sony cut the price? As I mentioned above, why should Sony make $50 less on each console when people are still buying them? Once sales begin to teeter off, Sony can get more aggressive about price cuts but until then, there’s no need to lessen the impact of the goose that laid the golden egg. Let’s also not forget that for the price concenous, the PS4 exists.
For those wanting something better, be it in 1080p or 4K, PS4 Pro is the console to go with which costs less than the competition and is home to a host of exclusive games, thanks to first party studios at PlayStation.
Sony has learned something Apple applies to all of its businesses — create value that isn’t tied to a dollar amount. Imagine if every time a competitor’s phone or computer was released, Apple dropped the price of iPhone or MacBook Pro. That would be a shitty way to run their business and leave customers frustrated too who may have just purchased one.
Instead, Apple creates value out of their ecosystem of products that complement one and other and continue to improve with each OS update. For Sony, that value comes from fist party studios, improvements to PSN, and enhancements to services like PlayStation Plus.
While much harder to achieve, a business model that creates long term value out of their platform and not purely from the exchange of dollars and cents is one that’s set for better long term success and creates customers for life along the way.
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