Recent analyses reveal that the prices of today’s gaming consoles are significantly higher than the historic trends would suggest. This finding comes from an in-depth review by Ars Technica, which examined pricing data and price-cut timing for major U.S. console releases over several decades.
Industry experts have noted a noticeable trend: Nintendo, Sony, and Microsoft have not adjusted their console prices downward in recent years. Instead, many current models have seen their suggested retail prices increase over the past six months.
If historical pricing patterns were followed, the original Nintendo Switch would be priced at an appealing $100 to $150 today.
Even when factoring in inflation, some PlayStation 5 models today are priced higher than they were at launch.
Despite a significant drop in Xbox hardware sales, Microsoft remains obstinate in not lowering Xbox console prices.
Statistics reveal just how much today’s console prices diverge from historical expectations, even considering the unusual inflation levels of recent years. If current consoles followed the price-cutting trajectory typical of earlier models, systems like the Switch OLED, PS5 Digital Edition, and Xbox Series S could be selling for around $200.
Analyzing the Data
To assess the current state of console pricing, a comprehensive examination was conducted using archival news articles, press releases, advertisements, and retail catalogs from the launch of the Atari 2600 in 1977 onward. The analysis focused on permanent MSRP announcements to avoid seasonal promotions or store-specific clearance sales skewing the results. For consoles that experienced multiple price drops in a single year, only the lowest price was recorded. Prices were then adjusted for inflation to bring them to July 2025 dollar values using Bureau of Labor Statistics’ CPI calculator.
Historically, most classic consoles experienced substantial price reductions within just a few years of their market entry.
In stark contrast, current consoles have maintained their initial prices or only seen marginal reductions since their launch, as evidenced by the post-2016 pricing trend.
The price variations among consoles reveal that while some have dropped significantly over the years, many current models are holding steady, reflecting a shift in expectations around pricing.
Pricing data from historical consoles demonstrate a pronounced decline in prices over time, a trend that appears to be missing from today’s market.
Current prices are markedly elevated compared to the historical norms for console price drops.
While it’s important to note that today’s consoles aren’t the priciest that the industry has encountered, earlier systems like the Atari 2600 and Neo Geo launched at prices exceeding $1,000 in today’s currency. More contemporary launches like the PS3 and Xbox One also came with hefty price tags, notably higher than the $300 to $600 range typical for many current consoles.
However, historical trends indicate that even those high-priced consoles experienced rapid price reductions. Classic gaming systems that debuted at elevated prices often saw significant reductions within a few years, aligning their prices with those of today’s offerings.
Reasons for High Prices
The question arises: what keeps current console prices elevated? While inflation has contributed to some price rigidity, it doesn’t account for the entire phenomenon. Adjusted for inflation, certain models, such as the Xbox Series S and PS5 Pro, exceed their launch prices significantly.
Factors such as increased import costs due to tariffs imposed during the Trump administration have influenced pricing strategies, with console manufacturers citing “market conditions” in their price increase announcements. Nonetheless, the trend of fewer price reductions was evident even before tariffs became widespread, as seen when Sony raised the price of the PS5 Digital Edition in 2023, prior to any significant trade wars.
Supply chain challenges related to the pandemic, specifically semiconductor shortages, initially hampered production capabilities and may have contributed to price stability. However, signs indicate that by early 2023, these supply issues had improved, questioning their impact on current pricing.
In analyzing broader economic factors, the deceleration of advancements in microchip manufacturing—often referred to as a slowdown in Moore’s Law—could also explain persistent high prices. This trend makes it increasingly difficult to produce cheaper or smaller hardware versions, impacting overall production costs.
Historically, console makers have been willing to accept losses on hardware sales to leverage profitability through software sales. Notable examples include rapid price decreases for systems like the PS3 and Xbox One, which saw price cuts shortly after less than stellar launches. Today, the absence of similar aggressive pricing strategies suggests that the market may still support these higher console prices.
Sales figures for systems like the Switch show that the lack of price reductions hasn’t necessarily diminished sales momentum. The PS5 and PS5 Pro also continue to perform well, indicating that current price levels may align with consumer expectations and market tolerance.
As long as manufacturers remain satisfied with sales performance at these prices, the traditional price cuts that consumers have come to expect may remain a relic of the past.