Welcome to Inside Games Daily, the only gaming news show brave enough to moan about PlayStation price increases, even though we haven’t turned ours on in a year. You know, when it’s like the first cold day of winter and you turn on your heater and you smell all the cobwebs and dust burning off. That’s kind of what it felt. That’s kind of what it smelled like when Stellar Blade came out. Yeah. Well, you know, I mean, people are still Sony’s still selling a just an absolute buttload of these things. In a recent earnings call, Sony shared that they expect tariffs to affect their bottom line to the tune of 100 billion yen or 680 million in the coming fiscal year. So that’s going to translate into price increases for the PlayStation. Yep. Yep. That’s uh that’s what they’re floating. That’s the that’s the bed they’re trying to make before they force everyone to lie in it. Sony CFO Linta floated the most obvious recourse, like Bruce alluded to, that Sony would of course raise their prices to offset the costs. M tow didn’t mention the PlayStation 5 specifically, but it’s easy to see them going that route since they have already done this a few times. I think not here in the US, but everywhere else. Yeah, had a few rounds of price increases. They did specifically mention the PS5 when it comes to the possibility of manufacturing though, which is really interesting. Sony’s CEO Hioki Tutoki talked about it a little bit and uh he admitted that the PS5 could actually be produced locally in the United States and that doing so would be quote an efficient strategy that quote has to be considered going forward. Okay. All right. Uh Sony currently manufactures the majority of its consoles in China whose tariffs were recently reduced from 145% to 30% for 90 days. So those aren’t that’s not done. uh and those negotiations are continuing as they have been for a very long time. So there’s always the pause and then we everybody waits and the economy recovers for a second and then who knows what will happen after that. It’s uh it’s weird. It’s almost like an abusive relationship where you make things really bad for a while and then you back off for a little bit and be like I fixed it. You were the one who did it in the first place. Anyway, uh it must be rough for Sony, huh? looking down all these tariffs trying to squeeze out a penny of profit in this rough landscape. No, you’re wrong, Lawrence. You’re absolutely wrong. Uh PlayStation had a literal exceptional year, boasting a 43% increase in income year-over-year. That’s huge. Yeah, and that’s just income. I was expecting, you know, net profits to be affected by rounds of layoffs and reductions in payroll, but this is just money coming in. That’s $2.8 8 billion in revenue for PlayStation with 18.5 million PlayStation 5 sold in the last fiscal year. Uh they sold 20.8 million PS5s last year. So a slight decline there uh for the fiscal year, but in terms of the incre income, that might be because of the price increase a little bit. Maybe that’s why it went up. The primary driver this particular fiscal year seems to be what it usually is. It’s just doing better than ever. And that’s selling other people’s games and DLC through its own store. Ah, they reported selling 303.3 million units of software this fiscal year compared to 286.3 the previous year. Yeah. And even though hardware revenue dropped a little bit. It actually went down 6%. Network services and revenue, which includes PlayStation Plus and monthly active users, which is a new metric they’ve been reporting. Both of those increased 23% and 5% respectively. So 23% more on network services, 5% more monthly active users. The reason we’re reporting on this story is because they’re raising prices on the PlayStation 5 cuz of tariffs, but then also they’re making more money than ever. So you’d say, well, hey, wait a minute, Bruce, since they’re making more money than ever, can’t they pass those savings on to the consumer? No, they’re never going to do that. Um, and another thing that I’ve seen very often, Lawrence, in our comments is like last time we reported on uh Nintendo Switch possibly raising the price, Nintendo Switch 2 uh and Xbox raising their price. We I don’t I don’t think we mentioned the tariffs uh as one specific point. I think it was for the Xbox and everybody was like, “You forgot about the tariffs.” I was like, “No, we have we did not forget about the tariffs. Uh every company is doing this. They are pricing higher because of these supposed tariffs that may or may not occur. Some are occurring, some are not. We don’t know when. Um, so I will say once these prices are raised, they are never going down ever. I don’t care what tariff is gone or uh is 30% or 10% or 145%. I promise you, we’ll never see the price go down ever again. And that’s something that I saw again in the comments of people are like, “Well, make sure you talk about the tariffs cuz the tariffs are raising the price.” You’re right. They totally are, but they it’s never coming down after this. Yeah. the uh while while I can understand like companies have to protect their bottom line and if it’s your department you’re not going to go to your boss and be like well our revenues went down and that’s just how it is. Your your boss at Sony is going to say [ __ ] it’s your job to keep that number up. So you got to do what you got to do. Uh which I’m not excusing it and I’m certainly not happy about it. I this is a scary trend in a lot of ways honestly. um kind of like inflation, you know, I think that while it’s a real practical business problem, it’s also sort of a public perception thing that allows them to raise prices. It reminds me of like layoffs. If if other companies are doing it, it becomes way easier for you to do it and you just slip in your headline. If everyone’s raising prices, it gets easy for you too as well. And scarily enough, that allows companies to really start experimenting with what the market will tolerate. And what scares me the most is that the market will tolerate it. That PS5s will still sell pretty briskly even if they raise the price $50, $100. I don’t want them to do that. I’ve thought for a long time game companies have been, and no one no one wants to hear this, but with the exception of things like DLC, you know, $150 Berserk costumes, FIFA Ultimate Team, companies have been largely uh scared, I think, out of pushing the boundaries up. Uh, some companies have, you know, Nintendo broke the seal on $80 games. Xbox announced that they’re going to do it. So, it’s like when when we all get used to the higher thing, everyone goes higher just because you can and because it’s your job to make the number go up. So, uh I it it worries me on another level beyond just things being more expensive is that it really does feel like more and more there’s a whole generation now that are being priced out of a particular kind of gaming experience. It’s baffling to me that that console gaming, which was the entry point, is now getting too expensive for people, you know, in their teens or 20s. It was really expensive for me, but I can’t even imagine now having to buy like a $700 PS5 just to play GTA 6 or whatever console’s going to be out by then. Who knows? Yeah, this is uh Lawrence, we saw this uh in the fast food industry uh in 2022 when inflation popped off. Um all fast food went up. all of them raised their prices like so it was like an average of like 10 to 15%. Um everybody complained about how McDonald’s prices were so expensive for fast food because it’s just garbage food that they had they were charging you know almost double now. Um and this is exactly what they did they tested the market for as far as they could go. Uh McDonald’s kept raising the price raising the price. Everybody complained complain complain. And eventually do you know what happened? People stopped going to McDonald’s. McDonald’s revenue went down and McDonald’s went all right you got us never mind. We’re going to start doing deal. they started doing meal deals again and stuff like that. And that’s what we have to do to the gaming industry. So, if the gaming industry raises the price at $80 or uh they they price consoles at $700 or whatever it is, we have to stop buying them. I don’t It’s like It’s so funny cuz I saw somebody again I was I read the comments every day. I saw somebody in the comments say Bruce says this every time. I was like yes because that is the only way to change things. You complaining on YouTube or on Reddit’s not going to fix it. I’m sorry. It’s not. it it has to be you stopping buying the product. And uh the the best example was in fast food just recently. Yeah. Uh as usual, I’m a little more resigned to the market uh doing what it does doing what it do. Um indivi Yeah, I’m all about individual action, but uh it’s it has scared me the tolerance the market has for pricey video game things. Um, so I’m worried that even if you know the gaming enthusiasts hold together strong uh and don’t buy expensive video game stuff that people outside of that bubble don’t give a [ __ ] and they’ll do it anyway. And then uh and then we all get priced out eventually uh because there’s there’s apparently layers of wealth that we can only dream of. People that can uh buy a room or PS5 for every room in their house regardless of if it costs an extra hundred bucks or not. Uh there are there are some bright spots. I think I this is routinely when I bring up PC. Um I think PC devices are getting more affordable even though at right now they don’t offer quite the the parody of experiences. I think it is a a more affordable and definitely a better longerterm investment. I mean I think we bring again I bring this up a lot too. PlayStation has exceptional revenues because they drive their software sales up. So you’re buying into a system that is more expensive uh over a long run. And what what extra worries me is that that just leaves a lot of the free-to-play games to scoop up younger players and wrap them up in their ecosystems. And those EOS ecosystems are getting very sophisticated. So you have entire generations going into, you know, Roblox and Fortnite and staying there because their games are too expensive. Um, and that sucks. I’d like to see a little more diversity. I’d like to see the money spread around. And I definitely like to see more people playing more and varied kinds of games. And for me at least as a as a gaming enthusiast, PC seems like the easiest way to go. But also, I can totally understand why a lay person who doesn’t want to worry about it that much or research it that much, PlayStation does seem like the the easiest, most consumer-friendly and and forward- facing and prominent brand for gaming. Yeah, I know that Lawrence and I sound like broken records. We say this over and over and over, say the same thing over and over, and it’s because prices keep going up. We’re reporting on these stories every single day about how every ecosystem is raising their price. So, we have to say the same thing to you guys over and over and over. Um, so that hopefully one of us will, you know, somebody somebody in the comments will be like, “You know what? Maybe I maybe I’m not going to buy the $80 game.” Um, and uh, and then they’ll find out the tolerance for the what the market has. I think Lawrence is right. I think it’s very scary and I think that people are willing to spend a lot more money on video games. Uh, because they see them as a luxury. Maybe they see them like sort of like a movie or a streaming service that they’re like, “No, it’ll be it’s fun.” You know, like it’s worth it. Um there’s an upper bound though and I don’t think we want GTA 6 to be $100. Yeah. And the the bounds are moving too or at least they’re expected to tar video games are not the only thing that are going to be affected by tariffs. If the price of food, toilet paper, like if the price of staying alive goes up, then the amount of discretionary income you have goes down. And if the pricey uh discretionary thing you want to buy also goes up, then suddenly there’s a lot of people who, you know, may have previously been able to make it work and now it just won’t or they’ll go into even more debt to to enjoy those things. So, it’s uh it’s scary to see this stuff, especially because I don’t think we’ve quite witnessed the full extent of the uh economic ramifications of what’s going on. So, yeah, this fall will be really interesting. I am really curious to see how Switch 2 does over the next year. Uh we’ll see if people have 450 bucks to toss around or more because of tariffs. Um yeah, you never know. Uh and all this talk about pricing really we want to thank the people that are supporting the Inside Games Patreon because they are actually using a little bit of their discretionary income to support this show which is huge. So thank you very very much. We have one lone patron that bought 500,000 PlayStation fives last year to make sure Sony’s line went up. Very nice of John Warren Galardi to do that. Thank you for keeping poor Sony afloat. Joseph Yote looks cool though. I’m excited for that.