[30944836]

>Not sure why they don't raise the price to whatever the bots are selling at.

Because if they do this, the response will be "Sony is greedy charging people all this money for something that only costs them $x to make."

I am not accusing you of this, just linking this to statements and thoughts that often arise in this context. A very typical response to questions about why something costs what it does is, "It's just supply and demand. Econ 101." But it's not just Econ 101. Supply and Demand is covered in Econ 101, but economic activity is far more advanced than supply and demand. Brand perception, customer good will, supplier agreements, retailing agreements.. all of these are major factors in determine "what" the price of an item is when it appears on the shelf. This is the work of entire teams at companies as big as Sony.

[MikeTheGreat]

I think that you're right, and in addition: there's a perception that the price is going up because there's a shortage that's outside of Sony's control, so if Sony jacks up the price I think Sony would be accused of profiteering / taking advantage of the situation.

"This company is price-gouging me due to temporary circumstances" definitely impacts brand perception, customer goodwill, etc

[abofh]

Typically the console makers make jack off of the console - often they lose money on the console. Profit is made off of licensing to game makers. Them jacking up console prices doesn't benefit them - they want as many consoles in as many hands as possible so that games can be sold to those users as possible.

If they make 50$ extra on the console, but the buyer buys no games, or buys a bad one and decides not to buy more on the console, that's a net loss right out, and an opportunity lost because the console didn't go to someone who would buy two, one of which they loved and caused them to buy three more.

It's the opposite of the iPhone situation - apple makes the majority of its money (on average) from the phone sale itself - people wait in line to give apple 30% off the top, even if they never buy an app or a song. So apple having a shortage slows down their profit this quarter, sony having a shortage slows down their loss this quarter and their profit 2023Q2.

It's short-term vs long term value of a customer, and the console makers are arguably making a better decision given the lifespan of a console.

[bombcar]

Sony also wants to keep selling ps5s for years -maybe a decade- and needs to not shoot their entire product schedule for some short profits.

If they want to milk it the best is focus on higher cost bundles etc until manufacturing catches up.

Every popular console has had issues like this, I remember the Wiifinders being a really big deal for two Christmases in a row.

[mjfl]

> "Sony is greedy charging people all this money for something that only costs them $x to make."

"then stop buying it"

Sony will never actually say this. But this would be the 'cynical capitalist' response.

[compiler-guy]

Sony needs people to buy it, and if the scalpers do it and resell, then Sony doesn't pay the reputational cost.

[30944836]

Yep. Even better, if they flood the market with additional units and sell them at the same price, it's the resellers (scalpers) take the hit, and not them. Sony is probably selling them at a loss and intending to make it up on the software (game) sales. This means doing anything to decrease the demand, even a little, reduces their ability to make money on the part of the business that is intended to make the money.

[kzrdude]

Sony is losing a lot - their customers are paying a huge "tax" on top of their product price and Sony gets nothing of that.

[mjfl]

the idea is that they won't stop buying it. If they would, then the price from the bots would be lower.

[brewdad]

As someone above pointed out, Sony is concerned about the entire 5 year cycle of the PS5, not just the current quarter or even first 18 months. There is also the need to maintain customer goodwill for the future PS6. There is already a fair degree of substituteability between a PS5 and Xbox. By the time the PS6 is out there will probably be a Steam Deck 2.0 and maybe something new with Nintendo.

It's far better to let the scalpers take the reputational hit.