4 years ago
Sony and Microsoft go head-to-head with the next generation of their blockbuster video-game consoles.
The Japanese company's deep bench of games and broader fan base - it has sold over 100 million PS4s, winning the battle of the previous generation - should see it retain its edge over it American archrival, according to industry experts.
"People who own Xbox tend to buy the new Xbox, while people who own PlayStation tend to buy the new PlayStation," said Wedbush Securities analyst Michael Pachter.
Yet the industry is changing and cloud gaming is on the rise, allowing games to be streamed without bulky hardware. This could curb console sales in the coming years, analysts say, a shift that could benefit Microsoft.
The two consoles - the first to be released by the two companies for seven years - are eagerly awaited; the Xbox will go on sale on Tuesday, and the PS5 two days later in core markets, costing about $300 to $500 apiece.
The race to order the devices in advance actually began weeks ago, though blink and you might have missed it. Pre-orders of Sony's PS5 sold out within minutes on many retail sites, for example, frustrating fans.
"It's exactly like shopping on Black Friday," said the high school student from Dallas, who has been playing video games with his dad since he was five. "You show up early, you walk away with something good. You show up too late, you'll walk away with nothing."
PLAYING IN A PANDEMIC
Sony might have the edge, but the stakes are high for the Japanese company. Its gaming business is its biggest cash cow; in its fiscal 2019 the division, which includes hardware, software, and services, brought in close to a quarter of its roughly $77 billion group sales and nearly 30% of its $7.9 billion operating profit.
Microsoft does not break out the results of gaming, though it's a smaller part of its business than for Sony. It also does not disclose hardware sales but the current Xbox One is estimated by analysts to have sold 50 million units.
For the other big hardware player, Japan's Nintendo, sticking to consoles is paying off with it hiking forecasts last week following elevated demand for its Switch.
The PS5 will retail at $499.99 or $399.99 for a digital-only version, while the Xbox Series X will sell for $499.99 and the lower-spec Series S for $299.99.
About 5 million PS5s are forecast to be sold this year, versus 3.9 million of the new Xboxes, according to media research firm Ampere, with combined sales expected to be higher than the previous generation.
