Good news for Sony: yesterday, the head of the video game division, Jim Ryan, reported that the shortage of PlayStation 5 is over. According to Ryan: “For everyone who wants a PS5, they will be much easier to find at retailers globally, from now on.”

Likewise, the console reached 30 million units sold, and better yet, it had a particularly strong month of December: although it did not beat the Switch, it managed to move 715 thousand units, staying 150 thousand units behind the market leader. But, despite this very good prospect, the question is: at this point… does it matter? I mean, we don’t want to sound too rude, but… will the PlayStation 5 be able to beat the Switch with such a disadvantage?

As always, you have to go in parts. Hard facts first: Nintendo is winning the generation hands down, unless you do like the clueless FTC and leave Nintendo out of the “high performer” market. The numbers are staggering: Switch has sold almost 120 million units, compared to almost 30 for PS5 and 20 for Xbox. That is to say: approximately 2.5 times more than its rivals combined. It’s a complete reversal of the dominance Sony had over the market over the past generation. But the question is: did the pandemic allow Nintendo to win the generation?

The reality is that… in part, yes. Both Xbox Series X/S and PlayStation 5 were released in the midst of the hardest days of the pandemic, in late 2020, before mass vaccination was available, in the dark days of being locked in by stone and mud. Of course, on the consumer side there was a desire to play video games, and the market actually increased… but by that time, just over half a year after the declaration of the pandemic, the ravages of the virus created a shortage of microchips and components. And since video games are not very high in the order of strategic consumer priorities, dominated by household appliances, cars and of course work computers, which have increased in demand due to remote work, the result was a disaster for the Xbox and PlayStation supply chains. An artificially depressed offer was maintained for months. The beneficiary? Nintendo, who already had the contracts and used cheap components for the Switch. The result: they won the generation by knock out.

Two years after these events, Nintendo’s dominance is unquestionable. But it’s also true that a lot of people really want the kind of games and experiences that both Xbox and Sony offer; I mean, come on, Nintendo has a very strong line, but it has always had the problem of the absence of certain genres and certain studies. Therefore, the appetite for its competitors was always there. The big problem is that we are halfway through the life cycle of a console, which is generally 5 years. For example, we think Nintendo is already thinking about a successor to the Switch, or at least they should, because the console is already lagging far, far behind in technology. Therefore, the question is whether Sony will be able to dethrone the Switch in the few years that remain, considering that the Nintendo console shows no signs of losing places in the sales chart.

The answer, for us, is no. Switch has already won the generation and the distance is too much. It has even surpassed the original Game Boy. However, this does not mean that Microsoft or Sony consoles will be failures. As we said, the demand is there. The problem is time and technological advancement: both companies are more dependent on the idea of ​​having the best graphics and offering realistic games. But the market also wants these games. What I predict is that Sony and Microsoft are going to experience a relative bonanza in these two years, since the offer has finally returned to normal levels. We will probably see very good sales; Making an estimate, perhaps both consoles will be able to sell 30 or even 40 million more units.

The problem is the future. If Nintendo decides to continue supporting the Switch, then there’s no rush for Sony and Microsoft. But if Nintendo releases the successor to the Switch, the pressure to release the next PlayStation and Xbox mounts. This is what will decide how much both consoles sell. But as always, the behavior of each of the market participants depends on the other. And the real question is: will Nintendo be able to keep its crown? What will happen to the fierce competition for franchises between Sony and Microsoft? One thing is certain: the next generation will be extremely interesting. 

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