TOKYO – Japanese gamers get the short end of the joystick, as Sony Interactive Entertainment has given priority to US consumers and other consumers abroad in its PlayStation 5 marketing strategy.
The PS5 has dropped in Japan since its launch in November, frustrating many domestic fans. Sony has not increased the local supply of the device even for the end of the shopping season, the hottest moment for video consoles.
Even worse for Japanese gamers is that Sony has stopped delivering all but one PS4.
The supply shortfall was highlighted on January 1 when Tokyo’s famous electronics store, Yodobashi Camera, put PS5 units on store shelves, despite growing concerns about growing coronavirus cases in Japan. The pandemic forced stores to make the popular game console available mainly through an online lottery. The industry has adopted the online lottery formula to prevent large crowds in stores and reduce purchases to resell at high profits.
Japanese gamers were amazed by a report in early January that Sony had stopped deliveries of most PS4 models in Japan, with Twittersphere erupting. “It was sooner than expected,” a tweet said. “I have to buy a PS5 now,” said another.
The PS5 is still sold out at many retailers in Japan.
In fact, Sony stopped domestic deliveries of three PS4 models, as well as a premium version of PS4Pro at the end of April 2020. In September, the company stopped delivering all but one PS4 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 are generally on the rise for several years before peaking. Annual PS4 sales, which were launched in 2013 and accumulated global sales of over 100 million units, reached a maximum of 20 million units in fiscal year 2016.
Even after the PS4 entered the market, Sony continued to deliver PS3 until 2017 to ease the pain of upgrade for users. The company has adopted the same approach for the phasing out of the PS4.
PS4 peripherals and games will remain on the shelves so that Sony can continue to reap the flow of profitable revenue. The company’s gaming company is now a major gain due to recurring online gaming fees paid by 46 million subscribers.
The decision to roll back the PS4 offer before the PS5 launch is meant to encourage the move to the new model, especially among PS4Pro users. This powerful game makes sense for Sony’s management, as the PS5 console is compatible with most PS4 games – a big change compared to the transition from PS3 to PS4, which does not support previous games.
Sales of PS5 in Japan were insufficient, with only about 266,000 units sold in the first eight weeks, according to Japanese gaming magazine Famitsu. This is about half of the PS4 in the same time frame and less than 60% of the PS3, whose initial sales also suffered due to lack of supply. In particular, PS5 sales rose sharply during the Christmas and New Year shopping season.
But this is by design, as Sony is focusing on the North American market, where nearly 2 million units have already flown off the shelves, according to VGChartz, a gaming information site. The company is facing strong competition from the new Microsoft Xbox consoles in the region, which makes it imperative to have a deep supply of PS5 there. According to VGChartz, about 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 in November last year, compared to 1.6 million for the PS5.
However, Sony does not feel the heat in Japan. Despite relatively modest sales of the PS5 at home, sales of rival Xbox consoles have not been much better, with only 30,000 sold so far, according to Famitsu. In other words, Sony does not have to worry that Xbox will conquer the Japanese market.
Microsoft is also struggling to secure a stable supply of consoles due to the lack of processing and graphics chips that affect most of the world. The executive vice president of gaming, Phil Spencer, recently asked the head of Advanced Micro Devices – the American chip maker that supplies 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 told CNN.
Apparently, AMD can’t keep up, as the demand for chips used in home entertainment is growing due to the pandemic.
Both the PS5 and Xbox depend on chips provided by AMD, such as the Ryzen CPU processed here.
Sony expects to sell more than 7.6 million PS5 consoles globally by the end of March, surpassing the PS4 sales record for the first year. The target seems handy, given that 4.5 million units have already been purchased, according to VGChartz.
Robust sales were also forecast for Japan, as consumers spend more time at home. But the supply shortage annoys some Japanese players. More than a few have lost their passion for the PS5, while others have migrated to PC games.
This shows that Sony’s strategy of pushing people on the PS5 by aggressively eliminating the PS4 can be given back home.
However, the company seems puzzled, launching another PS5 unit abroad in India on January 1 – hardly an encouraging sign for frustrated Japanese players and perhaps signaling a significant loss of prestige and confidence at home.