Sony is raising the price of the PS5 to unprecedented highs five years into its lifespan, effective 2nd April.
A standard system with a disc drive will soon cost $649.99, putting into perspective those classic Kaz Hirai memes from the PS3.
The world has changed a lot in the last 20 years, of course, but it’s been a particularly turbulent time for the console industry since the PS5 was introduced.
Historically gaming hardware has gotten cheaper as it’s aged, introducing new players to the ecosystem over time.
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But the PS5 has gone in the opposite direction: a Digital Edition cost just $399.99 at launch in 2020, but will set you back $599.99 in 2026.
So, what’s gone wrong?
Why Is the PS5 So Expensive?
It’s been an unprecedented generation for the PS5, which started during the pandemic.
Sony launched the console under the cloud of COVID-19, which meant launch events were cancelled and stock was immediately impacted by a global semi-conductor shortage.
It took years for the console to become readily available, and it wasn’t until 2023 that the manufacturer was finally able to meet demand.
But just prior to that, Russia’s invasion of Ukraine in February 2022 led to out-of-control inflation rates, which culminated in the first PS5 price increase across Europe before the end of the year.
Sony strategically shielded the US from this increase, presumably deeming the market too important against a still-relevant Xbox at the time.
In 2025, though, the console would see a second price increase in Europe and its first in the US, rising $50 across the board.
While the platform holder cited a “challenging economic environment, including high inflation and fluctuating exchange rates”, one obvious factor here was the US government’s introduction of increased tariffs on imported consumer electronics.
While the tariffs only apply to the US market, it’s probable Sony decided to increase the price of its console worldwide in order to prevent it from jacking up the prices too high in America.
Now it’s announced another round of increases, bringing the price of its cheapest Digital Edition model up to $599.99, an eye-watering $200 more than it was at launch in 2020.
The company cited “continued pressures in the global economic landscape”, which we can assume pertains to the cost of manufacturing.
Computer component prices have spiralled over the past six months, after it was revealed that OpenAI had bought up 40% of the world’s RAM manufacturing capacity.
OpenAI needs the RAM to install into its server farms, which it uses to power products like ChatGPT. But with all other manufacturers forced to fight over the remaining allocation of RAM, that’s pushed prices sky high.
To prove this isn’t just a PlayStation problem, Nintendo’s also under intense pressure to keep the Switch 2 at its launch price. And Valve has yet to attach a release date to its Steam Machines, which were originally scheduled to ship early this year.
In addition to all of the above, the US and Israel’s war with Iran has caused fuel prices to rise, due to logistical issues in the gulf. This is having macroeconomic issues which is pushing the price of everything from food to daily necessities up to record highs.
Is Sony Being Greedy?
An unprecedented chain of events have led us to the point today, then, where the PS5 costs significantly more than it did at launch.
But is PlayStation just being greedy?
Well, like all publicly traded companies, it exists to provide value to its shareholders, so there’s an inherent element of that.
Sony as a whole recorded record operating profits of ~$3.3 billion in its FY2025 Q3 earnings report last month, with PlayStation specifically contributing ~$900 million to that total, up 19% year-on-year.
But like all electronics manufacturers, its stocks have been hit hard by global events, with investors spooked by spiralling costs.
While the platform holder has been less willing to take losses on hardware of late, its business model is still predicated on the idea of getting its box into as many homes as possible, so it can reap the benefits of sales within its ecosystem.
It’s unlikely the manufacturer wants to increase prices this high, then, as it’s going to have a profound impact on the number of boxes it sells.
CFO Lin Tao said earlier this year that Sony aims to offset rising hardware costs by further monetising its existing players.
It may now need to rely on purchases from its 92.2 million PS5 owners, because these new console prices are going to slow its sales to a crawl – especially in an economic environment where everyone is feeling the pinch.
What Does This All Mean for PS5 and PS6?
As mentioned above, it’s going to be incredibly difficult for Sony to majorly expand its install base at these prices, which means hardware sales are going to significantly slow down.
While we’d still fully expect the manufacturer to cross the 100 million units milestone, any hope of GTA 6 propelling the console beyond the PS4’s sales trajectory now seems highly unlikely.
We expect the company to further squeeze its existing install base, which could mean increases to the cost of PS Plus, as well as key software titles.
The sad reality is, with Xbox already practically out of the race and Switch 2 likely to be hit with price increases over the coming year, there’s nowhere else for consumers to go.
PC component prices have also rocketed, so despite these massive increases to PS5 hardware, the grass is not necessarily greener elsewhere.
Of course, the impact this is all likely to have on the wider gaming industry is potentially catastrophic – especially at a time when development budgets are higher than they’ve ever been.
It was recently reported that a AAA title in the US costs around $300 million to make these days – figures which demand huge install bases and flush players to turn a profit.
There’s also the small issue of the PS6, which by all accounts is scheduled to release in 2027.
While there have been some rumours Sony could delay the machine, it’s also reported that the platform holder has booked manufacturing slots and signed contracts with vendors, which could be costly to postpone.
Word is that Sony’s next-gen console has been designed with cost-cutting in mind, but it’ll not be immune to these macroeconomic issues. So while the manufacturer may have built a device designed to drop in price, these current economic headwinds are still going to impact it hard.
All in all, it’s hard to imagine a next-gen console launching at a price less than a PS5 Pro, which will cost an eye-watering $899.99 starting next week.
With many consumers already satisfied with the capabilities of the PS5, and a long cross-gen period expected, will there be an appetite for a new console at that price? But if Sony delays it, are there any guarantees the economy will have improved in two or three years time?
These are the panicked conversations that will be taking place in Sony boardrooms around the world for the coming months.
Exactly what happens next is almost impossible to predict, but it’s becoming increasingly obvious that the video game industry has never faced challenges quite like this.