PS5, Xbox Series X Could Face Launch Shortages

Despite the various delays the movie and TV industries have seen in both major releases and production due to the novel coronavirus COVID-19, the gaming industry hasn’t shown much sign of slowing down just yet. In fact, one of this year’s biggest games, Cyberpunk 2077, is confirmed to still be on track for its September release date despite CD Projekt Red now working from home. All the same, one question has loomed over the industry given how massive of a year 2020 is meant to be — will the coronavirus impact the production of the next-gen consoles, and could the PS5 and Xbox Series X even be delayed beyond their planned holiday releases? As far as any launch delays go, the answer remains as uncertain as the extent of COVID-19’s impact on the world, and given how far out these consoles are meant to launch. But with the recent Xbox Series X and PS5 tech reveals, both companies have not announced adjusted releases and seem bullish on hitting their holiday 2020 launches. However, as the reality of the coronavirus’ impact spreads across all industries and around the world, analysts have spoken to IGN about the possibility that the next generation could at the very least see shortages. Six analysts and analyst firms spoke with IGN about the possibility of these consoles seeing possible delays. [ignvideo url="https://www.ign.com/videos/2020/03/27/ps5-xbox-series-x-no-delay-concerns-yet-next-gen-console-watch"]

Could Next-Gen Consoles Be Delayed to 2021?

Speaking to IGN via email, several analysts agreed on one thing — the coronavirus is likely to have some effect on the production of the new consoles, the extent of which remains unknown. DFC Intelligence noted that the sheer amount of uncertainty that hangs over this new console generation makes the short term ramifications hard to predict. “The current amount of uncertainty is unprecedented. We expect that demand will be greater than supply, probably by a significant margin. The only certainty is uncertainty and anyone who says otherwise has a crystal ball we don't have access to,” DFC said. The gaming industry overall has certainly seen the effects an increase in demand as countries adopt shelter-in-place orders. Steam just had its highest day of concurrent players ever — just around 20 million players online simultaneously. PlayStation, meanwhile, has decided to limit game download speeds in major markets like North America and Europe. It’s worth noting that Sony is also home to the fourth-best-selling home console of all time with 100 million PS4s in homes across the world. YouTube has adopted a similar policy to Sony’s, defaulting to standard quality playback worldwide for at least a month. Everyone’s feeling the strain on their networks as more people access online entertainment from their homes simultaneously across the globe. “At some point, if product is limited or price of components becomes too high, Sony and Microsoft will have to make a tough decision about whether to launch in very short supply or delay launch until the supply chain is comfortably running. We do not expect this decision to be made in the short-term.” Echoing those sentiments, Wedbush Securities’ managing director of equity research, Michael Pachter, isn’t expecting a delay either. “It’s highly likely that we will be well past the curve of the virus in most areas where manufacturing takes place by the time manufacturing must commence in June,” Pachter told IGN via email. “That suggests that both consoles will be in stock by November, so I don’t expect a delay in their respective launches.”

A Delay May Not Be Likely, But What About Limited Availability?

Both Sony and Microsoft have recently issued comments around COVID-19’s impact on the production of their respective consoles, and neither indicates any need for long-term concern. Even retailers like Gamestop have said they see “no indication” of outright PS5 and Series X delays on the way. Despite reassurances from the companies themselves that all will be fine, the very uncertain nature COVID-19’s curve in each country across the world means so much is still up in the air. With the situations in majorly impacted regions like North America, China, and more changing by the day, many analysts do see at least some impact on the console launches — perhaps in the form of a constrained launch. [widget path="global/article/imagegallery" parameters="albumSlug=9-sequels-that-would-make-ps5-a-force-to-reckon-with&captions=true"] In a statement provided to IGN that was also sent to Niko’s clients, senior Niko analyst Daniel Ahmad says he sees the situation as very dependent on the next few months. The company also noted that the reality of so many factories producing parts for these consoles means any definitive prognostication is unclear at this time. “The closure of factories since the Lunar New Year and the slow return to work for many will result in minor global console shortages in Q2 2020 and beyond. We do not expect significant shortages in Q2 as console sales are seasonal and most sell-through takes place towards the end of the year.” “If the coronavirus outbreak is contained within the next month or two then we would expect console manufacturers to be able to meet demand for the holiday quarter, both for current gen consoles and next gen console launches,” Niko’s statement reads. “If manufacturers are unable to operate at full capacity before the end of Q2 2020 we could see an impact on the launch of next gen console launches, with either limited supply or delayed releases becoming the likely outcomes.” [widget path="global/article/imagegallery" parameters="albumSlug=xbox-series-x-reveal-images&captions=true"] That’s ultimately the biggest factor in how launches might be impacted — when COVID-19 can be contained enough to allow production and work to resume at a normal pace. While the curve of China’s number of infected cases has flattened in comparison to other countries and, according to the New York Times, the nation claims to be significantly halting the spread of COVID-19, there are also serious concerns about its reported numbers. The Times reports that, as China is starting to lift lockdowns, its number of cases is reportedly not counting those testing positive for COVID-19 without symptoms, which could indicate a larger, undocumented spread. Meanwhile, Japan initially suspended the Olympic 2020 games, with the event now set to take place a year later in July 2021. And America has now become the country with the highest number of COVID-19 cases worldwide, with more than 86,000 confirmed cases. The Institute of Health Metrics and Evaluations predicts a continued rapid rise of cases in the US through at least May, with a peak in April, followed by a steady, smaller stream of new COVID-19 cases through to August, where its projections end. The range of manufacturing may not take place in the most impacted countries, but parent and wider companies themselves may still feel that impact. Head of Xbox Game Studios Matt Booty has said, “Each studio is facing unique challenges and constraints depending on its particular location, and many of our external development partners around the world are similarly affected.” [ignvideo url="https://www.ign.com/videos/2020/03/20/ps5-vs-xbox-series-x-full-spec-analysis-next-gen-console-watch"] Dr. Serkan Toto of Kantan Games, who had initially spoken to IGN about a possible console launch delay, saw the strong showings of Series X and PS5 tech as a relieving sign that both companies will push through to a holiday release. “I was skeptical about the PS5 release schedule because of Sony's silence at first,” Toto said. “But as Microsoft already reconfirmed ‘Holidays 2020’ as the launch date, there is no other way for Sony than to keep up. “They will not watch their top competitor gobble up holiday sales while they sit on the sidelines with the PS4.” Even if there are issues in manufacturing, Toto believes Microsoft will remain on course. “At least for Microsoft and at least for now, the coronavirus-related dents to the supply chain seem to be manageable as far as the next-gen roll-out goes,” he said.

How Worried Are Consumers?

Speaking with IGN via email, Spiketrap, an analyst firm co-founded by former X-Play host Adam Sessler that tracks online social sentiment, took a snapshot of online discourse and found that, at least through the first few weeks of March, fans don’t seem particularly worried about console delays. Spiketrap’s data, viewable in the graph above, saw only about 1,300 online engagements around the idea of a delay, specifically after DFC Intelligence’s thoughts on the possibility were first published. The relevant conversation has largely been around either COVID-19 or AMD, the manufacturers behind chipsets in both the PS5 and Xbox Series X. However, the conversation has remained minimal online, with only one day in March peaking above 300 engagements on the topic. That said, we’d still like to hear from you all directly: are you concerned about console scarcity and possible delays? Specifically, would you be willing to purchase a re-sold console online if you can’t get one at launch, or would you be willing to wait for new consoles at a later date? Cast your vote in the poll below, which, as of press time, sees nearly 90% of voters willing to wait until consoles are available rather than buying a higher-priced resell on eBay or a similar site. [poilib element="poll" parameters="id=0b3e594c-eec7-4b02-b6af-101b2b4c6b64"] We discussed these analysts’ insights in the last episode of our weekly show Next-Gen Console Watch, which you can catch with new episodes on IGN on Fridays at 6 am PT and 9 am PT. [poilib element="accentDivider"] Jonathon Dornbush is IGN's Senior News Editor, a panelist on Next-Gen Console Watch, and host of Podcast Beyond! Talk to him on Twitter @jmdornbush.

source https://www.ign.com/articles/ps5-xbox-series-x-could-face-launch-shortages