The PlayStation boss John Kodera recently made a statement that the Ps4 console is entering the end of its lifecycle. The statement made a lot of headlines and has owners of the console (especially newer ones) concerned about whether the console will get discontinued soon.
However, the statement could mean anything. It doesn’t seem likely that the console would get discontinued anytime soon as the PlayStation game lineup becomes better every year with amazing exclusives such as the incoming Last of Us Part 2 or the new God Of War game. Therefore, Kodera may have meant something else when he said those words. Here’s what it means:
The context
Without context, Kodera’s statement would mean that the Ps4 is likely going to stop production and eventually get discontinued soon and that a newer console would soon take its place. However, that is not the case at all as the statement Kodera made was in a different context altogether.
The Ps4 has been a very popular console ever since it arrived in 2013. There are tons of great exclusives that are available to play right now on the Ps4 as well as newer ones that are coming which will make sure the console keeps millions of copies for the foreseeable future. However, the number of people buying the console is decreasing each year. For example, According to Sony’s latest quarterly report, they expect 16 million units of the Ps4 to sell this year. This year’s number is down 3 million from last year’s expected value of 19 million which is down a million from its preceding year’s value of 20 million.
Therefore, as the years go by, the expected number of Ps4s the company will sell seems to be decreasing. Kodera’s words were simply trying to explain this yearly decrease to investors and analysts. The decrease in sales is nobody’s fault either as the company is doing its best to come up with great exclusives and great services to entice more people to buy. However, one must realize that the console came out back in 2013.
When the console first came out, it sold a lot of copies, that’s because it was relatively new. At that time, the Ps4 console was considered as a “Next-Gen” console and not many people had it as everyone was on the “current-gen” at that time which was the Ps3 or Xbox 360. Therefore, a large transition took place as it was apparent that the current-gen consoles would now become previous-gen and the next-gen would soon become current-gen. During this transition, of course, a lot of consoles were sold because people were changing from one generation of consoles to another and there were many people who were doing that.
However, fast forward to now, the transition is now complete for the most part, there are very few people who haven’t upgraded yet from their old consoles. Those who don’t have a Ps4 are likely those people who’ve never owned a PlayStation before or never bothered about console gaming in the first place or are gamers from other consoles wanting to buy the Ps4 for exclusives, which is a minority compared to gamers making the switch during the initial years. That’s why, even though it’ll still sell millions of copies every year, the number will gradually decrease at this point, the vast majority of gamers have a “Next-Gen” or now “current-gen” console.
What does this mean for the future for the PlayStation console?
Although there may be a steady loss of profits each year due to decreasing sales, Sony can easily cover this up through the PlayStation network. Their own PSN network is growing day by day and the amount of people opting for a PS Plus subscription is increasing rapidly due to the increasing number of fantastic multiplayer games.
SIE chief Kodera: Beefing up first-party titles wouldn't just mean more new IPs. Strategy includes franchising successful IPs and refreshing existing IPs.
— Takashi Mochizuki (@6d6f636869) May 22, 2018
Moreover, even though the number of consoles bought may be decreasing every year, the number of PSN users increases every year, so Sony is able to balance out the loss in revenue from sales to the gain in revenue from the network. Therefore, it’s likely that the Ps4 will stay for at least a couple of years before Sony decides to ditch it for a newer console. The amount of money Sony makes from its network is also likely to increase as Sony is shifting its focus to more first-party exclusives and add-on content, which not only helps them generate revenue through the PS Plus subscription but by through game and add-on sales too.
PS chief Kodera: PS4 is entering final phase of its life cycle, which would have negative impact to the unit, but recurring revenue via membership services etc should cushion some of that.
— Takashi Mochizuki (@6d6f636869) May 22, 2018
Sony also has other options for revenue as well in the form of PSVR. Although its VR devices aren’t doing great at the moment, the future is bright for them. VR gaming is still relatively new and it’ll take time for it to become fully mainstream. Currently, it’s regarded as expensive and “unnecessary” by many. However, as more interest in VR develops over time, Sony can expect to make a lot of money through the PSVR as well.
As far as when we can expect a new console, there’s no official word but Kodera has implied that we might get something in 2021. This coincides with Sony’s prediction for decreased profit for the games and network services division at the end of the fiscal year on March 21, 2021. The decreased profit may be due to Sony investing in some serious hardware for its next console, even if it isn’t, it’s just diminishing returns at this point. According to Kodera, in 2021, the PlayStation console will “crouch down once” to stand taller in the future.
SIE head Kodera told analysts and investors that the period until March 2021 would be when PlayStation to "crouch down once" to grow further in the future.
hmmmmmm.
— Takashi Mochizuki (@6d6f636869) May 22, 2018
The PlayStation 5
Kodera’s comments about crouching down once are interesting and it implies that we could expect something new in 2021. This is further implied as Kodera gave a bit more details in a recent interview following his statements from last time. Translated by video game industry consultant Serkan Toto, Kodera once again said that the Ps4’s lifecycle is about to end but Sony will be taking appropriate steps in the next 3 years to prepare for the future.
3) While he doesn't use the word "PS5", Kodera says (again) the PS4 entered the final stage of its lifecycle and that Sony will spend the next three years "preparing for the future". //end
— Dr. Serkan Toto / Kantan Games Inc. (@serkantoto) May 23, 2018
Although Kodera has been careful not to use any words that’d confirm a new console, it’s very likely that it’ll be a new console. Although nothing is certain, one can make an educated guess that the console will be focused on 4K gaming. The Ps4 was focused on giving players a 1080p gaming experience with often many games running at 60 fps.
As gaming continues to evolve and become bigger and bigger, 4K gaming is quickly becoming the norm. 4K TVs are not that expensive as they used to be and by the time they come out with a new console, 4k TVs would likely be common in households. It can be argued that Sony already has a 4K capable machine in the form of the Ps4 Pro but it’s not necessarily good.
The Ps4 Pro does NOT provide native 4K like its competitor, the Xbox One X or any capable gaming PC. Instead, it gives upscaled 4K which is not the true UHD experience. The console is only slightly more powerful than the original Ps4 whose tech is now severely outdated according to current times. Therefore, the next PlayStation console will likely aim to rival or be more powerful than the current Xbox One X which is currently the most powerful console in the world at around 6 teraflops of power.
Sony hasn’t made any announcements for revealing any plans for the new console at this year’s E3, therefore it’s likely that they haven’t even started working on it, it’s just in their plans for now. Given it’ll still take three more years for us to get some information about a new console, we can expect a more powerful console than the Xbox One X as technology improves very fast. The console will likely be able to handle anything you throw at it, whether its VR or 4K gaming.
Conclusion
Although the sales for the Ps4 are decreasing each year, it’s likely not going away anytime soon. Even if a new console gets announced in 2021, it’s likely that the Ps4 will stay for a couple more years before becoming officially discontinued, just like the Ps3 did.
As far as the new console is concerned, it’s likely that some sort of reveal will happen in 2021 and given Sony’s track record with their amazing games and their amazing reveal of the Ps4, fans can expect something truly amazing when the reveal actually happens. Until then, one can only wait.
