Sony was able to sell 4.5 million PlayStation 5 consoles in 2020, which more or less matched the total achieved by the PlayStation 4 over seven years ago. However, there’s no question the Japanese giant could have sold more – but it’s seriously struggling to meet demand instead. That’s led to all kinds of issues in the retail sphere, with scalpers scooping up stock and driving up the resale market.
Unfortunately, this problem will persist for the foreseeable future. “It’s difficult for us to increase production of the PS5 amid the shortage of semiconductors and other components,” said chief financial officer Hiroki Totoki during the organisation’s recent earnings call. “We have not been able to fully meet the high level of demand from customers [but] we continue to do everything in our power to ship as many units as possible to customers who are waiting for a PS5.”
The firm’s gaming division is doing extraordinarily well, with profits up almost 50 per cent year-over-year for the quarter that ended 31st December, 2020. This is despite the “strategic price point” of the PS5, which is making a small loss for each unit sold. Ordinarily, console manufacturers lose money at the beginning of a generation in order to profit towards the end, but the success of the PlayStation Store in particular has enabled Sony to reverse this trend.
Of course, these hardware shortages are a real headache for the company, as its ambition was always to transition players to the PS5 as fast as possible. Sony will have its work cut out this year both meeting demand and ensuring that content is on schedule, with many developers around the globe being forced to work from home due to the ongoing pandemic. It’s an unprecedented set of circumstances; let’s see how it copes.
[source arstechnica.com]
Comments 48
Here's an idea... Why not allow customers who desire to order a PS5... order it in a "backordered" status. That way retailers have time to verify purchases are not going to bots and scalpers and people have a confirmed date that their PS5 will be shipped. If I spent $500 and knew that my system would be given to me in 3-5 restockings... I'd be ok with that.
I mean at this point - anything beats rapid firing the purchase button only to have it yanked from your cart.
I have yet to see a PS5 on a shelf and its now February.
Absolute madness. At this rate, i'd be lucky to get it by Christmas.
Hey, glass half full - if anything, it should reinforce the steady sales down the road. See how Switch remains in high demand four years into its life? PS5 may be much less unique and versatile on the hardware side, but it still boasts an exclusive lineup of games from two libraries (or three in a glorious few countries with PS Now support). There should be more to it than the launch hype.
It’s not great news as I’m concerned if they can’t get consoles to gamers, then games like Ratchet and Clank, HZD2 might get delayed due to not enough consoles sold to get high game sales.
I can see this happening, just wait and see.
Looks like I won't be getting one this year. Might as well stick with my PC.
Keep an eye out for Amazon Warehouse sales. I bought one for £39 because it had some physical damage to the box. It still has a warranty from Amazon.
4000 plus on Ebay. At this point i don't expect to ever see a PS5 in stores to buy.
Translation:
artificial scarcity
Real winners are stadia and Xbox with their streaming future focus. They don’t really want too many boxes in peoples homes long term if they aren’t their own boxes that is. Which the majority wouldn’t be.
It’s frustrating all right. I don’t get how there can be people who’ve ordered 10 for friends and family and yet most of us are constantly looking and can’t even get 1.
@nessisonett I mean, if they are ordering them for family and friends and selling it for what they paid for it... I guess I don't have a huge problem there - other than jealousy that I don't have them as a family member or friend
@Juvenlast It’s a good idea to allow back orders, but how would an online retailer be able to tell the difference between a bot, scalper, or normal human?
NINJA APPROVED
@Snick27 What’s even more insane is that many of those highly priced PS5’s on eBay have 40-50 bidders.
NINJA DOES NOT APPROVE
@BloodNinja
Couple thoughts
1.) The purpose of scalping is to have a system now, while stock is low. Bots and scalpers probably wouldn't want to be on this list anyway. Because they wouldn't get a system until a later date. They aren't hitting the "add" button to get a system after all.
2.) Email confirmation required after entry, as well as periodic confirmations as your ship to date approaches. This would make it problematic for bot users I think.
@Juvenlast this makes far too much sense. It’ll never catch on 😉
@deathaxe Which just furthers my original point above. If there was a backorder system. People would be in line, they could reasonably estimate when they'd get a system, their credit card would be charged when the order was processed and no more stalking websites to get a system. It is really a win for everyone to do this.
@deathaxe Its all related isn't it? The under title is "Sony doing everything it can" ... well maybe it isn't.
@Hyperluminal
Think you must of missed a zero somewhere!
If not £39 is the deal of lifetime, hell a million lifetimes.
'It’s difficult for us to increase production of the PS5 '
The key word seems to be 'increase' though
(Please if you dont like my comments either ignore or reply in a civilised manner I have no time for bickering and insults. Thanks )
@Juvenlast Yes!. Backorder please. The PS5 and Xbox Series consoles are not limited. There will be more in the future. Maybe the retailers would be able to give us a ship date either right away or when the availability gets closer. Backordering has been a thing in retail forever. I don't now why this can't work.
@deathaxe Like I get what you are saying. This article is talking about semi-conductors and that is the "why" behind the inability to increase production. But the article also references the retail side. It isn't just about factories and semi-conductors... it is about satisfying customers and increasing install bases. And if Sony moves to something (anything) other than the current system for purchases this limited product - I know that that would alleviate some pressure for production. Because, people would know, generally, when they were getting their own PS5. Manufacturing and retail are inherently connected. As the article implies.
I guess one question is when does the initial, fervent enthusiasm typically start to taper off for a new console? 30, 40, 50mil? Anyone know?
@deathaxe
There was an interesting Lisa Su interview in January.
https://www.anandtech.com/show/16409/amd-ceo-dr-lisa-su-interview-on-2021-demand-supply-tariffs-xilinx-and-epyc
@suikoden they're cheap because they are warranty returns. Some of them come from stores that can't sell them because the box is damaged. It was sold 'as new'. I suppose it was lucky timing on my part to see the deal. I have alerts set up on HUKD for deals like this.
I do have to question, again - weren't we told that they had substantially more PS5 available at launch than PS4? But now the number comes out that it was about the same. Do we know more about why the numbers we were told before were wrong? It wasn't a prediction, it was about what they had at launch. It changes the dimension of the launch considerably. And that of the Japan shortage. Were they playing loose with numbers and referring to the simultaneous Japan launch as "more" when the total launch period had the same number despite greater demand?
And what happened to being on target for 11M Q1?
There seems to be a lot of funny numbers going on regarding the amount of launch window consoles that exist.
@BloodNinja Plus if you were in a waiting queue, scalping would be a lot less lucrative. Now it's FOMO that drives scalper sales. The fear you can't get one until 2022 at best. If you could sign up and get an official date of July 17, you'd have your $500 order in, you know when you're getting it, and you just wait rather than paying an extra $200 to some random guy and no warranty ju st to get it today. People would still do it, but there would be a lot less certainty and profit in the act of scalping in general.
@Juvenlast As a Canadian customer this would help so greatly, especially for countries that don't have access to that PS Direct service where you can order the console directly from Sony themselves i.e. pretty much every country that isn't the US
I'm having trouble believing this is all do to "semiconductor shortages". If that's the case why are they able to sell stock currently. Every week it seems like there's multiple stores that sell all new consoles in limited quantities, nearly every single day. Same with GPUs. This is them controlling the market. What they could do, is hold onto the stock and release them into the stores, everything else is selling in the stores. By keeping it online only and slowly releasing stock shows they don't care. Also by them praising its being such a successful launch states the exact same. It's been an absolute disaster everywhere. It not only hurts us, those that want to buy one for ourselves/family, but also hurts the developers as well.
@swagbag713 Lmao I saw at Walmart CA the Series S was in stock for like 2 whole weeks so that gives a good indicator of how well it's selling compared to the Series X let alone the PS5
@swagbag713 If I didn't already have access to a good PC the exclusives at the moment that pique my interest are pretty few and far between as well
I'm hyped through the roof for Hellblade 2 and Fable, and I'm definitely interested in Everwild and the new Perfect Dark game the Initiative is working on, but I'm pretty sure none of those games have gameplay for them either let alone solid release windows
At present my interest in exclusive games comes like 95% from the PlayStation side
@NEStalgia Exactly. There IS a lot of funny business with regards to information about PS5 stock.
NINJA APPROVED (not the stock issues)
@Juvenlast I suppose, but a simple script to automatically answer such emails would trivialize it. It doesn't seem like scalping is a problem that is easily fixed, honestly. Just gotta be patient and roll with it, either that or if you have disposable income, $1000 or more for a PS5 doesn't matter anymore.
NINJA APPROVED
@Chris0160 If we add this to what AMD was saying, I don't think "semiconductor shortages" is so much an issue so much as AMD underestimated demand and doesn't have enough silicon for the new consoles at the ready. It does sound like they put contracts in place to fix that, but that those contracts don't go live until the second half of the year. I think "semiconductor shortages" is white noise. There's just not (yet) enough of this semiconductor because AMD didn't plan on making as many as are needed and the fix for that has half a year wait before it's operational.
They're making more steadily, but at the old contract numbers, and can't really increase the quantity produced per-day greater than the current pace until then.
Similar to the auto industry, it's not that there's a true lack of silicon being produced, it's that when the car plants shut down in the Spring, all the chip mfrs shut down the production lines for thier parts. Cars have a shortage of chips because they need to play catch up on their contracts and factory capacity with their chip vendors to basically build from scratch.
@frankmca Agree with most of it except shipping address duplicates. There should be a limit to prevent group buys all going to a warehouse or something, but just because multiple customers have the same shipping address or IP doesn't mean they're not separate customers. Every customer should be valid for the lottery. It can be tied to PSN ID rather than address (as the PSN IDs are also tied to addresses and reveals if it's a real account with gameplay history or a generated shell account.) they kinda sorta did that with the pseudo lottery this time, but it was a mess.
But the other problem is cutting retailers out of sales by sending it through the mfr direct sales-only isn't going to go down well with their retail partners. That then becomes a question of if video games want to be a direct-sales-only model.....which is the only reason they haven't done that already, I'm sure. I could easily see Amazon, Walmart, Tesco, whomever dumping all their game and accessory inventory and carrying only Nintendo (and/or Xbox) if Sony were to pull the launch hardware sales from them. Kind of like when Sega flipped off half their retailers by launching Saturn with only select retailers. The screwed retailers liquidated their remaining Sega inventory and never carried it again.
@frankmcma I'd be open to that.
@Juvenlast
Exactly. Or link it to your psn account.. But no, they won't do that because they know they're making more money from scalpers then pretending that they can't do anything to stop it.
It's getting pretty obvious and pathetic now
@jorel262 probably because the retailers are making money from this regardless of who they sell to?
They could easily make their system more fairer, but they won't do it for obvious reasons
@Chris0160
'I'm having trouble believing this is all do to "semiconductor shortages".'
That's because the article is about increasing production. Production itself is not disrupted.
Sony plans to hit the number and expect to sell more than 7.6 million PS5 consoles by the end of March,
@NEStalgia
Number wasnt wrong.
The PS4 sold 7.5 million units in the fiscal year of its release, i.e. from November 2013 to March 31st, 2014
It's just very similar but not wrong
@JJ2 did it say how many in 2013 alone though?
We were reassured that had significantly more ps5 available for launch than for ps4 launch repeatedly. But from this number.... It doesn't look true. It looks like they had about the same inventory, not much more.
@NEStalgia
https://www.theverge.com/2014/1/7/5284508/sony-has-sold-4-2-million-playstation-4s
sore subject saved up a few years money on the bank at launch went to buy , click on ps5 disc edition (i prefer a retail disc) in my cart went to buy spinning thing on screen , sorry we are sold out , scalpers took mine lol, saw a ps5 on ebay for 500 and thought keep it! il wait, busting to own one but buying from a person to make extra cash to get pist lol meh il wait. its a disgusting practice should be made ilegal , no point in defending it don't bother.
@JJ2 Yeah, that's what I was thinking. So the "significantly more units available than ps4 launch"... Was all of 200,000? And since PS5 launched worldwide and ps4 excluded Japan..... That actually means there were less units available in other areas at launch than there were for PS4 at a time when gaming has a lot more customers than in 2013. No wonder supply is such a disaster. Even without the demand surge from the pandemic that wouldn't have been close to enough to satisfy even the natural demand properly.
I'm assuming the yield problems that were reported that Sony denied are actually true. That's certainly less inventory then they expected to have in that time, assuming the repeated claims of so many more than ps4 launch were honest based on expectation in the plan.
It's funny because the headlines read like "wow, ps5 sold so many consoles", but the real story is "Sony had less ps5 inventory for launch than they said they'd have and that's why they're the new cocaine on the black market"
@NEStalgia
It's very possible that there were a lot more ps5 units at launch than for ps4. We know Sony shipped a lot by planes. It just looks like ps4 had less shipped at a time but a more consistent supply whereas PS5 shipping more at a time.
Edit
As for Mochisuki 'rumours' , the man has a long history of questionable 'news' and was proven wrong many times.
Sits with his very quiet Pro
"Thanks, I'll wait".
@Juvenlast I couldn't agree more with you. I'm sure this is how it used to work. I remember preorder both the PS2 and PS3 and was told I'd be informed which shipment batch I'd be in by the retailer. For the PS2 I was told I'd miss Christmas but would be in the first batch aftwards at Game, with PS3 I was told I'd have a launch console by eplay (remember them?). Even with PS4 when I preorder with Amazon, I was told we can't guarantee launch day at ordering (but did get a day one unit). I don't understand new system at all. Let us order in a que, rather than a made scramble everytime, which will always favour the scalpers.
Meanwhile, Nintendo plans on "rigorously meeting demand"
https://www.nintendolife.com/news/2021/02/nintendo_is_rigorously_responding_to_demand_for_multiple_switch_consoles_per_household#comment6115321
SOMEONE IS BLUFFING
NINJA APPROVED
Wow, I was hoping I could get one by April, but maybe that's not realistic now. The upside is that there still isn't much must-have software on the PS5 yet. I still don't feel that I'm really missing out on anything yet, but I'm gonna be salty if these things still aren't on shelves when HZD 2 and ratchet and clank are out!
@NEStalgia @JJ2 I don't know, it just baffles me every year a gpu/cpu is released AMD, Nvidia, and Intel fail to understand the demand. Sony and AMD should have known the demand would be massive. Lottery tied to the psn account does sound great. Might lead to the creation of fake accounts.
This is the last thing Sony wanted. They need to sell as many units as possible before streaming really takes off.
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