In previous generations, console prices often dropped significantly over time, allowing consumers to purchase an Xbox One or PlayStation 4 for less than half their initial cost after a few years. However, the latest batch of consoles has seen minimal price reduction, despite some moderate discounts being offered in certain European regions. Limited supply has also been a contributing factor.
Phil Spencer, the head of Xbox, recently indicated that significant price drops for these consoles shouldn't be anticipated in the future. He clarified, "The prices aren't coming down. We've made the Xbox Series S with this in mind. We understand the importance of price in reaching more customers but a console that begins pricing at $500 can't be expected to drop to $200. The essential components used aren't subject to Moore's Law anymore, hence they no longer inevitably drop in price. Therefore, the typical trend of specs determining depreciating price points over a decade doesn't apply anymore, which results in relatively flat console pricing."
Rising inflation and demand for components have led both Microsoft and Sony to raise their suggested retail prices since the Xbox Series X and PlayStation 5 were launched in November 2020.