The current generation of consoles has hemorrhaged money from both Microsoft and Sony, so this next-generation of consoles will either bring technologically similar systems or grossly more expensive consoles.
According to a report from VG24/7 yesterday, Microsoft has spent and lost about $3 billion with the Xbox 360, while Sony has spent and lost about $5 billion on the PlayStation 3.
It’s safe to assume the next-generation of consoles will be more expensive than this previous generation of systems, but the kicker is people still want them at an affordable price.
Something is going to have to give here because Sony and Microsoft cannot make bigger, more powerful consoles without charging top dollar for them, and then still remain financially solvent.
In this case, gamers will not be able to have their cake and eat it too. If these beastly consoles are somewhat discounted then there is a strong likelihood that these will be the last systems from Microsoft and Sony, not because there is nowhere left to go with them technologically speaking, but because the divisions are simply losing too much money for the companies to continue making them.
If not that, then there’s the chance that the next-generation could last well over ten years, or at least until Microsoft and Sony make their money back.
Some have wondered why this generation has lasted so long; well it’s probably because Microsoft and Sony are trying to regain nearly $8 billion in losses.
Gaming consoles are not just toys to release for the hell of it, and these companies will not continue to be weighed down by these money drainers.
It’s a business and the two organizations do not want to release new systems without financial purpose in mind. If they are continuing to lose money and are dragging down the company financially, then they will cut the fat and eventually say bye-bye consoles.
Want further proof? Sony has been struggling enormously from a financial standpoint, which is also evident in the massive layoffs they have had to make over the past six months.
Sony confirmed last year that they would be dissolving about 10,000 jobs, which is no doubt due to financial constraints forcing their hand.
Sony is more than just gaming, as is Microsoft, and so if their PlayStation division is dragging their company down, then they make think twice about sending out another expensive console.
Perhaps it’ll be a downgraded console or there won’t be one at all, but rest assured Sony and Microsoft will not standby and watch another $8 billion go down the toilet.
People should prepare to pay more for better consoles, which yes, that is not logical thinking (sarcasm), because Sony and Microsoft will not want another $8 billion of losses on these next consoles.
So gamers are going to have to swallow more expensive consoles if they hope to continue to see them. If not, then perhaps gaming on consoles may become obsolete.
How much are you willing to pay for an Xbox 720 and/or PlayStation 4?