Playstation

PS4 Price Cut 2015: When It Happens It Will Be Huge


Looking ahead to the rest of 2015, we decided that we’d put together our best estimates, guesses and predictions on when some of the big consoles will receive price drops. The PS4 and Xbox One are entering their second years while the Wii U is in its third. Two of them haven’t really moved much on price while Microsoft’s console has dropped by $150 in 12 months. In this article we’ll focus on one of these three consoles, this time putting our attention on the PS4.

Chances of PS4 Price Cut in 2015

The smart money would be that as long as the PS4 is still selling well globally at $399, Sony won’t drop the price. The company can use all the profits it can get right now and Sony even said midway through 2014 that they were selling the PS4 at a profit per unit. 18.5 million consoles sold means the system is a runaway success, just below PS2/Wii levels of commercial success.

I’d wager that the PS4 will receive a price drop in 2015 and it won’t be just $50. Sony has a history of going big when they finally do cut the price of their consoles, like when they cut the PS2’s price from $299 to $199 in spring 2002. I do believe that the standard 500GB PS4 will drop to $299.99 in the US between E3 in June and Gamescom in August. Sony does like to announce price cuts or new models at Gamescom so I’m leaning towards August.

If Sony is already making decent profits off each $399 PS4 unit in mid-2014 and with the system using tech that benefits from economies of scale, unlike the PS3’s Blu-Ray Drive and Cell Processor in 2007-2008, they will have some serious wiggle room on price. As soon as Sony gets the cost per unit close to $300, like $320-$340 for example, they’ll drop the system’s price to $299.99. This will keep sales fresh throughout the back half of 2015 and most, if not all of 2016.

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Another reason why Sony would be wise to cut the PS4’s standard SKU price to $299 is Project Morpheus. Sony was still tinkering with it during 2014 so the device may be nearing completion. Sony has to hit this one out of the ball park and getting a cheaper VR headset to the masses would be a Kinect/Wii Remote level add-on that would boost PS4 sales tremendously. Let’s not pretend the thing will be cheap though.

Sony could bundle the PS4 with Project Morpheus when it hits retail, likely during the holidays of 2015 if it makes it out this year, for $399 or $449. I can’t imagine Sony will let the device cost more than $150-$180 at retail even if it costs more than that to make. A Ultimate PS4 bundle with a 750GB-1TB HDD, Morpheus and the PS4 camera for $400-$450 sounds like a good bundle to me.

A more far-fetched reason why Sony will cut the PS4’s price to $299 in 2015 is to move stock of the older model. Sony typically releases a slim model of their console 3-4 years into its lifespan. The PS3 slim arrived two months before the system’s third birthday so if Sony does the same with the PS4 that means the PS4 slim will release in late 2016 at the earliest. If they go with this timeline then I imagine they’ll want to sell as much of the older, fatter model as possible before releasing a smaller, more cost effective unit.

I don’t have any insider information, I just feel like the PS4 will get a pretty big price cut this year. The system has maintained its launch price for a very long time and when it drops, I believe it will be more dramatic than a $50 cut. Who says Sony doesn’t get the PS4’s manufacturing cost down to $300 by the end of the year anyway? If they do, they could take a small loss on each unit and more than make up for it with sales of Project Morpheus, the cut they get from third party games which are selling better on PS4 than Xbox One so far or from Playstation Plus subscriptions. I expect Sony to wait as far into 2015 as they can before they cut the PS4’s price but when they do, they’ll go big.