The gaming industry is currently going through a challenging period, and as it continues to weather the storm of incoming inflation, rising development costs, and the memory crisis, the core audience is being impacted little by little.
Just a few hours ago, Sony announced new prices for the PS5 console lineup, confirming that the PS5 Pro would cost close to $1000 soon. Such price hikes were unheard of in the past, and have rightfully led to growing concerns within the industry.
According to a prominent analyst, the long-term impact of rising prices could limit many gamers’ ability to engage with the hobby.
Taking to BlueSky, Circana analyst Mat Piscatella shared that higher console prices last year meant that a record-high 53% of hardware buyers were from high-income US households in the gaming market last year.
Discussing the recent price hikes from Sony, he then highlighted how increasing hardware costs would lead to fewer lower and middle-income gamers buying hardware. He even pointed out that lower-income households could be priced out of the gaming market altogether.
As Mat Piscatella puts it, this would be very, very bad for gaming since it would become limited to the rich. The analyst also noted that as hardware costs continue to rise, gamers will look toward cheaper alternatives. This may lead to an increased focus on free-to-play games, cloud streaming services, and budget-oriented choices like the Xbox Series S.
“As video game hardware prices continue to jump rapidly, this market will lose presence in middle-income households.” – Mat Piscatella
For context, the PS5 Digital Edition, which launched for just $400 in 2020, will now start from $600. Similarly, the PS5 Disc Edition has seen its price rise from $500 to $650.
The Xbox Series S|X have seen similar price increases over the last few months, and the PC industry is in a dire state due to rising GPU, memory, and SSD prices. All things considered, hardware has never been more unaffordable for the average gamer.
