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Ars Technica’s analysis reveals that modern video game consoles are significantly overpriced compared to historic trends. Looking back to the Atari 2600 in 1977, most systems saw steep price cuts within a few years, often selling for less than half their inflation-adjusted launch price by year three and as little as one-third by year eight. Today’s consoles, however, resist that pattern. The Nintendo Switch, eight years old, still sells for 86% of its launch-adjusted price, while consoles like the PS5 Digital Edition and Xbox Series S remain at or above original real-dollar costs. By contrast, classic systems routinely fell below $300 in today’s dollars.
Factors behind today’s stubborn prices include pandemic-era chip shortages, lingering tariffs, higher production costs due to slowing advances in chipmaking, and inflation. Still, these don’t fully explain the break from history. Unlike earlier generations, manufacturers seem unwilling to sell at a loss to drive adoption. Systems like the PS3, Xbox One, and Wii U once received steep cuts despite initial costs, but Sony, Microsoft, and Nintendo now hold firm.
The reason may be simple: the market accepts these prices. The Switch and PS5 continue to sell strongly despite lacking cuts, suggesting no incentive to lower prices. Even Microsoft, facing weak Xbox demand, hasn’t budged—focusing instead on services and Windows-based gaming hardware.
Ultimately, consumers are paying hundreds more than history suggests they should. Unless sales falter, the traditional cycle of rapid console price reductions appears to be a relic of the past, replaced by pricing strategies that keep consoles expensive for far longer.
Opinion:
Interesting.
Never knew the prices were elevated by so much.
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