Japanese gamers crave PS5 as Sony feeds the US market

TOKYO – Japanese gamers get the small end of the joystick as Sony Interactive Entertainment prioritizes U.S. and overseas consumers in its PlayStation 5 marketing strategy.

The PS5 has been in short supply in Japan since its deployment in November, frustrating many domestic fans. Sony has not increased the device’s local supply even for the year-end shopping season, the hottest time for video consoles.

Even more irritating for Japanese gamers is that Sony has stopped selling all but one PS4 model.

The tight supply was highlighted on January 1 when famous Tokyo electronics store Yodobashi Camera put PS5 units on store shelves, despite growing concerns about the increase in coronavirus cases. in Japan. The pandemic has forced stores to make the popular gaming console available primarily through an online lottery. The industry has adopted the online lottery formula to avoid crowds in stores and reduce purchases to resell them with large profits.

Japanese gamers were stunned by a report in early January that Sony had stopped shipments of most PS4 models in Japan, with the Twittersphere erupted over the news. “It was earlier than expected,” a tweet said. “I have to buy the PS5 now,” said another.

The PS5 is still out of stock at many retailers in Japan.

In fact, Sony stopped domestic shipments of three PS4 models as well as a premium version of the PS4Pro at the end of April 2020. In September, the company stopped shipping all but one of the PS4 models to retailers. in Japan.

Sony is expected to take similar steps to phase out the PS4 in overseas markets, but declined to provide details.

Sales of new game consoles typically grow for several years before peaking. Annual sales of PS4, which launched in 2013 and recorded worldwide sales of more than 100 million units, peaked at 20 million units in fiscal 2016.

Even after the PS4 hit the market, Sony continued to ship the PS3 through 2017 to alleviate user upgrade difficulties. The company has taken the same approach to phase out the PS4.

PS4 peripherals and games will remain on the shelves so Sony can continue to reap the lucrative revenue stream. The company’s gaming business is now a significant source of revenue thanks to recurring online gaming fees paid by 46 million subscribers.

The decision to reduce the supply of PS4 ahead of the launch of the PS5 is intended to encourage the upgrade to the new model, especially among PS4Pro users. This power play makes sense for Sony’s management, as the PS5 console is backwards compatible with most PS4 games – a big change from the PS3 transition to the PS4, which did not support previous games.

But PS5 sales in Japan have been mediocre, with just about 266,000 units sold in the first eight weeks, according to Japanese gaming magazine Famitsu. That’s about half that of the PS4 over the same time frame and less than 60% of the PS3, whose initial sales also suffered from a lack of supply. Notably, PS5 sales hardly increased during the Christmas and New Years shopping season.

But that’s by design as Sony focuses on the North American market, where nearly 2 million units have already flown from shelves, according to VGChartz, a gaming information website. The company faces stiff competition from new Microsoft Xbox consoles in the region, making a significant supply of PS5 imperative. According to VGChartz, around 1.5 million new Xboxes have already been sold in North America.

The latest Xbox also has a strong presence in Europe, where 700,000 consoles have been purchased since its launch last November, compared to 1.6 million for the PS5.

On the other hand, Sony does not feel the heat in Japan. Despite relatively modest home sales of PS5s, sales of rival Xbox consoles haven’t been much better, with just 30,000 sold to date, according to Famitsu. In other words, Sony doesn’t have to worry about the Xbox conquering the Japanese market.

Microsoft is also struggling to ensure a stable supply of consoles due to a shortage of processors and graphics chips plaguing much of the world. Executive vice president of games, Phil Spencer, recently asked the head of Advanced Micro Devices – the US chipmaker supplying both Xbox and PS5 – to keep up with demand. “I was on the phone last week with [CEO] Lisa Su at AMD [asking] how can we get more? Spencer said, according to CNN.

AMD apparently can’t keep pace as demand for chips used in home entertainment skyrockets due to the pandemic.

Both the PS5 and the Xbox depend on chips provided by AMD, like the Ryzen CPU shown here.

Sony expects to sell more than 7.6 million PS5 consoles worldwide by the end of March, breaking the PS4 sales record for the first year. The target seems within reach given that 4.5 million units have already been purchased, according to VGChartz.

Strong sales were also forecast for Japan, with consumers spending more time at home. But the supply shortage is irritating some Japanese players. More than a small number have lost their passion for the PS5, while others have migrated to PC games.

This shows that Sony’s strategy of pushing people towards the PS5 by phasing out the PS4 may backfire at home.

Still, the company seems unfazed, launching yet another overseas PS5 player in India on January 1 – hardly an encouraging sign for frustrated Japanese gamers and perhaps signaling a significant loss of prestige and trust at home. .