Sony has had it's latest video game console, the PlayStation 5, be speculated for its price during the last year. Michael Pachter, a gaming analyst, predicted that the console would cost at least $800 with all the tech it's going to be equipped with.
The recent coronavirus pandemic has effectively brought prices up by disturbing supply chains, which include the PS5's components. The company hasn't made any official announcement on the prices just yet, but expect the final tally to hit close to home with what Pachter visioned.
Sky-high prices due to limited supply
One reason for the possibly staggering price of the PS5 is the increase in prices of DRAM, which, for the PS3 amounted to $9.80 and a generation later, cost the PS4 a whopping $88. The hard drive, however, stood at a similar price of $38 to $37 for the PS3 and PS4, respectively.
The price of the PS4 was raised to cover the added cost of the components, while today's market and economic conditions are expected to bring the PS5's parts to a price range that will tower over previous ones.
The DRAM of the newest console is priced at around 70% more than the PS4's, while 1GB of GDDR6 memory was expected to cost $11.69 per chip at the start of 2019, the 16GB chip was tallied at around $110 to $150.
The prices of memory chips in 2019 plummeted due to oversupply, but have recently started going up once again. DRAM prices have reached double digits in the past month, and the effects of the COVID-19 infection have shot costs even further up.
The price hikes would give an expected increase in the prices of the console to shoot up as well, so expect to have a more significant base cost as the GDDR6 RAM gets a 70% increase from the past.
Another big player in cost
The DRAM isn't the only significant factor in why sky-high price predictions are looking more real, as the PS5's SSD will also contribute to its overall pricey outcome. Previous components which were used in the PS3 and PS4 were mainly consistent at around $40, but may not be viable anymore as Sony plans to equip their latest product with a custom-made 825GB solid-state drive (SSD).
The storage device's prices could reach up to $100 a pop, which puts it at more than twice the price of its two predecessors'. The added concern here is that NAND flash storage, which is used in SSDS, is expected to jump by 40% in price this year as the deadly virus limits supplies.
The combined prices of the storage and graphics components could reach up to $250 and will make up a majority of the console's total cost.
Prices for processors went up by 20% for the PS4 as compared to the PS3, and if this number is to jump at a similar rate, then the PS5 would have a $120 custom chip, which then leads the running total to almost $400 in production costs only.
History shows that previously, Sony only had to cough up $225 for the same components, which, if we were to assume that all other parts and components maintain their price, the company would have to cover the three main parts' increased costs.
This may effectively result in increasing the baseline price of the PS5 by almost $200 even to start seeing profits. This will have the console with near certainty, absorb the whole of the production cost that will result in a consumer-cost price of $599.
See the video below for Michael Pachter and his prediction of the PS5's potential price.