Retailers Banking On PlayStation 5 In 2020, More Speed & 8K Streaming

Retailers are banking on Sony’s next-generation PlayStation 5 generating big revenues when it is launched next year despite a move to PC gaming by consumer’s who in the past have been console gamers.

Sony Chief Executive Kenichiro Yoshida has called the PlayStation a niche product, aimed at serious players a mantle normally associated with PC gamers who are able to significantly expand their hardware configurations.

“Details when making games have become more important than ever,” he said at a recent company strategy briefing. The company talked up the specs of the next PlayStation such as “ray tracing,” which is used for optical effects such as showing the play of light on characters’ faces when they move about a candlelit room.

The Playstation Division has delivered more than US $21 billion in revenue and nearly $3 billion in operating profit for Sony who are struggling to sell TV’s and sound gear.

Today the PlayStation has become Sony’s flagship consumer product and is tipped to go on sale in Australia in late 2020 but this time round will have to compete with new gaming players such as Google and Apple.

Alphabet’s Google is pitching a new service called Stadia starting in November, while Apple plans a new videogame service called Apple Arcade.

Stadia focuses on games that can be streamed from the cloud and don’t require expensive new hardware. Microsoft is also using late 2020 as the launch date for its next-generation Xbox.

Sony sees Microsoft as its main competitor in the next generation, with Google a potential threat in the mid- to long-term as internet technology advances, one company official said. Nintendo isn’t perceived as a major rival.

According to the Wall Street Journal PlayStation has been one of the most successful mass-market products of the past quarter-century; the PlayStation 4 alone is expected to pass 100 million units this year. Sony’s latest thinking puts less stress on overall sales numbers and more on the most-profitable segment of the market: the devoted fans who buy big-budget titles, such as Bethesda Softworks LLC’s “Fallout” series and Take-Two Interactive Software Inc.’s “Red Dead Redemption.”

A second Sony official said the company believes people buy a videogame console to play graphics-heavy games.

Sony says a high-powered machine in the home will still be necessary to run the latest graphics stably because cloud services rely on sometimes-balky internet connections. The next PlayStation will be capable of processing 8K ultra-high-definition graphics, said the PlayStation unit’s chief, Jim Ryan, in May.

Mr. Yoshida, the Sony CEO, described the fifth-generation PlayStation as “dramatically increasing the graphics-rendering speed” and said the change “clearly demonstrates why it makes sense to have a next-generation console.”