For a long time, the common wisdom was that game consoles would usurp PC gaming, leaving it a niche hobby, ignored by the greater gaming community. And indeed, for a long time consoles were the most popular way to play mainstream games. But recently, especially since the release of the current generation of consoles, the very opposite seems to be coming true. PC gaming has been expanding while consoles falter.

Looking forward to the next Xbox and PlayStation consoles, analysts are predicting $900 as the low end of possible pricing–and that number is seeming more and more optimistic. That’s a lot of money to spend for a dedicated machine that, for most console owners, is just used for playing Call of Duty or the latest football game. Consoles are becoming too expensive for all but the most dedicated gamers to justify–especially when gamers in their teens and early 20s have grown up in a world where a console is no longer needed to play the vast majority of games.

While the gaming industry as a whole is still massive, the traditional sector of games are struggling. Games industry sales tracker Circana reported that last year, games spending in general dropped by 4% compared to last year. Hardware spending specifically dropped 27% percent. Xbox Series and PlayStation 5 sales dropped by 70% and 40%, respectively. Nintendo’s numbers were bolstered by the launch of the Nintendo Switch 2, but still saw a 10% drop. Both PS5 and the current Xbox consoles have seen multiple price hikes in the last 18 months, and the Nintendo Switch 2 launched at $450 in the US, 50% higher than the launch price of the first Switch.

Video game software and hardware have both been remarkably inflation-resistant over the years. In the days of cartridges, games for Sega and Nintendo systems typically cost around $50, with exceptions for games with extra memory or special chips built in (e.g. Final Fantasy VI, Star Fox). If the industry simply followed inflation the way many other products do, those games would cost almost $130 a piece today.

Consoles have been similarly resistant, hovering around $600 when adjusted for inflation. The Nintendo Entertainment System launched at $180–about $600 in 2026. The PlayStation was $299 at launch, or about $630 now. The Xbox 360 at $399, or $675 in 2026. The PlayStation 3 was a notable outlier here, with the $600 price tag that then-PlayStation boss Ken Kutaragi said customers would “work more hours to buy,” would be $1012 today. Mostly, though, they’ve stuck around the same level of impact on our wallets through the years.

Throughout the lives of these systems, almost every one has seen some kind of mid-cycle update, like the tiny PSone, the Xbox 360 Slim, and the Xbox One S, that launched at lower prices than their direct predecessors–including the PlayStation 3 Slim, which launched at $299 in August 2009, or about $460 now.

Now, that’s starting to change.

This is all to help establish what a strange time we’re living in for gaming. The Xbox Series X and PlayStation 5 launched in 2020 for $499 each. Almost six years into their lifecycles, we’re still buying the original systems–not slimmed-down versions–and we’re paying more for them. The PlayStation 5 retails for $580, while the Xbox Series X goes for $550. The next systems from Sony and Microsoft are expected, again, to be at least $900.

There are, of course, a variety of reasons for these climbing prices. The general march of inflation is part of this, but certainly not the whole explanation. Tariffs introduced by the Trump Administration in early 2025 (now declared unconstitutional) put a lot of weight on imports from parts of the world where important console components come from, such as Taiwan and China. Those tariffs have made nearly everything about importing electronics into the US more expensive.

There’s also the impact of the AI industry, especially in the US, which has been in a state of flux since nearly its inception. We’ve talked before about the potential impacts of the AI-induced chip shortage on gaming and gaming hardware. Companies such as OpenAI have been rapidly opening data centers, and this has increased demand for ultra-fast memory (RAM) and solid-state storage to the point where some companies, like memory maker Micron, have turned away from supplying consumers to focus on business-to-business contracts. That higher demand for components makes them more expensive, driving up the price of the consoles that require them.

Interestingly, the past few months have seen an increase in data center cancelations, and almost half of US data centers are expected to be delayed or canceled entirely in the next year. However, as with any price increase, prices go down much more slowly than they go up, so it’s hard to say how these new elements will change that part of the equation.

And we can’t ignore the bombing of Iran by the United States and the resulting closure of the Strait of Hormuz, a major sea shipping route. We’ve barely begun to see the knock-on effects of how that will influence the prices of everyday staples, in addition to supplies for electronics manufacturing.

And let’s not forget about the current state of culture in general. Gaming as a hobby is still most popular with millennials, and younger gamers these days prefer social gaming experiences, whether competitive or otherwise, as well as games centered on user-generated content. And while many of us merely adopted doomscrolling, Gen Alpha was born in it. Social games and social media are where their interests lie. They’re spending more time on social media than games, and when they do engage with games, it’s just as likely to be done by watching a stream as it is by playing something..

Further, those bombastic games that sell systems are taking longer and costing more than ever to make. You can’t buy a PlayStation and expect to get two or three games in your favorite franchise. Every Spider-Man, every Uncharted, and every Forza Horizon is now make-or-break games for these consoles.

Consoles are more expensive than ever, and people on average have less income to spend on them. The traditional gaming audience is stagnating, and newer gamers are playing less-demanding games for longer and longer. That means that Microsoft, Sony, and, to some degree, Nintendo have to do a better job than ever of selling their systems to us–making them worth the money. Uh-oh.

Historically, major advances in graphics have typically been the reason to buy new gaming consoles. The jump from NES to Super NES, from PlayStation to PlayStation 2, and so on, were self-evident. But if your PlayStation 5 or Xbox Series console still feels new to you, despite being almost six years old, it’s not just you. Game graphics have hit something of a plateau, and even companies like Nvidia are currently focused on optimization. Photorealistic games are the norm, and the competition from one to another isn’t nearly as dramatic as it used to be. Advances in visual fidelity have become incremental.

A look at Halo Infinite on the Xbox One vs. the Xbox Series X.

So if advances in technology can’t drive console sales, it has to be about exclusive features, right? While there are rumors both Sony and Microsoft are shifting course on this, both companies have spent the last decade or so adding more and more of their games to a wider variety of platforms.

The next Xbox, code-named Project Helix, is intended to bridge the gap between gaming consoles and PCs, allowing users to play back-catalogs of not just five generations of Xbox games, but also games from popular PC storefronts like Steam and Epic, all through the streamlined interface of a game console. That’s actually an exciting feature if it works as well as promised, but most Xbox games these days are already available on PC anyway. Sony has its library of pseudo-exclusive titles to lean on, but if it continues releasing its games on PC, then Project Helix owners would be able to play PlayStation games on their Xbox consoles. (Sony is reportedly considering returning to true exclusives, however.)

Aside from these features, the next Xbox and PlayStation are very similar machines in terms of feature set, utilizing a more efficient chip that uses AMD’s Zen 6 and RDNA5 architectures, which offer almost identical feature sets.

It’s also worth talking about PCs here, because PC components are in trouble, too. As someone who is suddenly having to replace their motherboard, CPU, RAM and power supply, I can personally attest to this.

If you wanted to build a PC that will match the power of these upcoming consoles, it might well be more expensive than simply getting one of these consoles, but that’s an unfair comparison. The advantage PCs have right now is that so many of us have them, and we’re currently in a period when many popular games will run on significantly older hardware. Of the top 20 games on Steam right now, most of these games are seven or more years old, with the exceptions of the latest Call of Duty and Baldur’s Gate 3. Generally speaking, people don’t need a high-end PC to play the most popular PC games.

Consoles are getting more expensive and having an increasingly difficult time making a case for themselves because of the slowdown of visual enhancements and a convergence of features. The system-selling blockbusters take longer to make. The only thing that could really push back on this is Grand Theft Auto 6, which is currently set to release this fall. The Grand Theft Auto series is traditionally a stone-cold system-seller, and the kind of thing that people will go out of their way to pay for.

What it comes down to is that consoles have been moving toward becoming even more of a luxury for some time now, and with rising prices, that trend is finally coming to a head. Microsoft and Sony won’t have an audience to sell to if they can’t make their systems more affordable and find more compelling reasons that we should buy them.

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Game Consoles Are Pricing Themselves Out of Relevance