Last week, Sony announced the future of PlayStation hardware in the form of the PlayStation 5 Pro. The mid-generation refresh bears a lot of resemblances to 2016’s PlayStation 4 Pro in strategy, pursuing price-insensitive consumers hankering for the latest and greatest in gaming hardware. But at a hefty $699.99 price point, there are a lot of open questions about the console and its place in the average living room.
GamesBeat asked several industry analysts — Mat Piscatella of Circana; Daniel Ahmad of Niko Partners; and Rhys Elliot of Midia Research — for their thoughts on the PlayStation 5 Pro and its potential future both as an individual piece of hardware and in the larger console market. Does the newest console from Sony have the punch to carry the PlayStation brand’s forward momentum or is it too much, too late?
As with any product, a fundamental question to ask is whether there’s an enthusiastic audience for it that is excited for the console immediately. As a more-expensive mid-generation refresh, Sony is tasked with at minimum creating and selling a product that absolutely has to own the console for its stronger capabilities. Simply being a better option is moot if it’s not an exciting, better option. So, is that audience there?
“Sure. But it’s a small one,” explains Piscatella. “There is a group of price insensitive hyper PlayStation enthusiasts that need to have the latest and greatest PlayStation thing regardless of cost. And that’s who this is really targeted at. This is a way to keep that audience engaged and evangelizing the brand, while giving them a reason to buy another piece of hardware during the generation. It’s certainly not targeted at the mass market buyer. The base PlayStation 5 remains an excellent console that will meet the needs and be purchased by 85%+ of PlayStation 5 buyers moving forward.”
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In an open statement, Daniel Ahmad questions the slightly muddier messaging of the PS5 Pro compared to its predecessor. “Sony’s PS5 Pro, a mid-generation upgrade to the PS5 and priced at $699, builds on its mid-generation refresh strategy first introduced with the PS4 Pro in 2016. However, while the PS4 Pro had a $399 entry point and simple marketing message in terms of 4K graphics and HDR, the PS5 Pro is a slightly harder sell given its high price point and less straightforward marketing message, opting for more nuanced messaging in terms of upgraded graphics, advanced raytracing, and AI-driven upscaling. In both cases, the Pro models are premium products tailored for a niche audience that is willing to pay for increased graphical fidelity.”
Rhys Elliot believes that the more silent generation of PS4 owners that have yet to upgrade to the PS5 will make up a not-insignificant audience for the PS5 Pro.
“In Sony’s 2024 Business Segment Meeting, it announced that half of all monthly active PlayStation users were on the PS4,” Elliot says. “This means that some 50 million players have yet to upgrade. Some of these users might be tempted to enter the latest console generation at the PS5 Pro, but they would need a reason to do so. Sony would be shrewd to market the console as “the best way to play Grand Theft Auto 6”, ahead of GTA 6’s culture-shaking launch. A PS5 Pro bundled with GTA 6 would work even better. Sony released special-branded PS4 Pros for first-party games (Spider-Man) and third-party ones (Monster Hunter), so we can expect a similar strategy for the PS5 Pro.”
The immediate comparison to the PlayStation 4 Pro is one that looms over its PlayStation 5 equivalent. While the 2016 PS4 Pro was able to succinctly market itself as a 4K gaming machine at a time when 4K adoption was starting to pick up, the PlayStation 5 Pro’s graphical prowess is not as summarily described. How does the value proposition differ and does that difference matter?
Piscatella comments, “It’s reasonable to argue that the PS5 Pro’s value prop doesn’t meet PS4 Pro’s at the time of its launch. I also don’t know how much that really matters with the target audience. This is a group that buys more on brand promise than what’s actually being offered in a lot of ways. And, again, this is a small, price-insensitive part of the market. They just want the latest and greatest, and that’s what the PS5 Pro is.”
“The PlayStation 4 Pro had a better value proposition, offering native 4K resolution when many general consumers were upgrading to 4K TVs with HDR,” Elliot details. “The PS5 Pro does not have such a proposition. Like the PS4 Pro, the PS5 Pro offers better visuals, however. And that use case might resonate more with console gamers these days. To that end, the PS5 Pro launch presentation underlined the consumer pain point of choosing between fidelity mode and performance mode. These different modes are now more common than they were during the PS4 Pro’s launch. Mark Cerny mentioned that 75% of PS5 players go for performance, so the choice is a real one for many base PS5 players.”
It is difficult to talk about the PlayStation 5 without dedicating some focus to the elephant in the room: the price. At $699, the powerful console also boasts a powerful price high above what the market is used to. Beyond the current hardware, does Sony’s newest PlayStation portend higher prices all around?
“Not entirely,” Ahmad told GamesBeat. “While the Pro is focused on a price-insensitive audience, console manufacturers have still taken steps to ensure they have a lower cost entry point. This is the Switch Lite for Nintendo, the Series S for Xbox and the PS5 Digital Edition for Sony. However, what we have typically seen this generation is that these models have not received permanent price drops.”
Ahmad added that Niko Partners expects the PS5 Pro to sell around ten million units in its lifetime, making up about 10% of the predicted PS5 lifetime sales.
Elliot has a less optimistic view for price-conscious console gamers. “I would say that the next generation of consoles will have a new, higher floor for pricing. If PlayStation and Xbox could turn back the clock, they’d probably have priced their base consoles at $600 at launch. Just look at Xbox’s $600 dollar 2TB Galaxy Black Edition. While that console has a Blu-ray drive, besides more storage it essentially has the same specs as the launch Series X. I expect to see the PS6 and Xbox’s next-generation consoles retailing at $600, at least. PlayStation is clearly testing the waters with its PS5 Pro pricing.”
Piscatella says, “Looking specifically at the US, the US console market is a mature one, meaning that we’re not seeing organic growth in audience size or spending. In fact, video game console hardware spending peaked way back in 2008, at $7.7B. The closest the US hardware market has gotten to that total since 2010 is the $6.6B reached in 2022. But the audience that does exist on console is pretty dedicated to it. Meaning, in order for hardware spending to grow, higher pricing will likely have to be part of the equation. So, long story short, yes, I’m expecting prices on new console hardware to continue to increase. We’ve now seen that (previously a bit radioactive following the PS3’s pricing announcement way back when) $599 threshold reached or broken by both PlayStation and Xbox, so I certainly won’t be surprised if we see that again.”
As a salable product, the PlayStation 5 Pro is assured to be controversial. It breaks all previous conventions about acceptable console pricing. Elliot, however, explains that this is simply a matter of the times and market changing.
“When the PlayStation 4 Pro launched, the highest-end iPhone (7 Plus) was priced at $769. Today’s highest-end iPhone (the 16 Pro Max) starts at $1199.”
Perhaps, in that sense, Sony is simply a vanguard of market movement, pushing the boundaries of what consoles can sell for rather than limiting what they can be. We will find out when the new hardware releases on November 7.