If you’re remotely interested in video games, you probably know how hard it is to get a PS5 or Xbox Series X. Next-gen is upon us but it’s not easy to be a part of it. In September, both consoles went up for pre-order but sold out in seconds at respective retailers. It wasn’t a matter of being the fastest, more so being lucky.
This continued for weeks leading up to release with a few restocks. Now, about three weeks after launch and post-Black Friday… don’t expect any more big restocks. There’s a lot of anger from fans as to how this happened. How did two massive game console launches get botched like this? Well, there are a number of reasons behind this.
Manufacturing process
The big question is: Why didn’t Microsoft and Sony make enough Xbox Series X and PS5 consoles? There’s a few reasons but the manufacturing process has a lot of layers to it.
Sony and Microsoft usually to work on their next consoles shortly after launching their current one. It’s such a long, tedious process that it’s not something they spend just a year or two on. It can’t be, it has to be planned carefully if they want it to last for close to a decade. But that doesn’t mean they’re putting them together in factories for years.
The actual time to manufacture began in the summer for both consoles. If you own a Series X, you can actually find the manufacture date on the back of your console (supposedly, it stretches back to July). Sony got to work on their consoles in June, according to Bloomberg.
The assembly process is also very layered. The companies order all the parts from various companies like AMD, which usually arrive before they begin assembly. Then, they’re assembled at least partially by hand, typically. Once they’re all ready to go, they ship them in bulk to their distribution centers. That last part is incredibly important. They’re not shipping them 10 at a time, they’re shipping them out in large portions. They have to wait until there’s enough to ship, not just a handful at a time.
Some of these consoles also aren’t sold, they’re given to press or notable figures. Another batch is also held to the side to replace potential defective units.
The ones that are being sold at retail then have to make long trips around the entire world. Many electronics such as consoles and phones are assembled by Foxconn which has factories all over but largely operate out of China. So the consoles must travel from China to every other region in the world. Sony was aware they’d need to match demand so they reportedly started using air freight, acquiring 60 flights of PS5 shipments.
It’s always been hard to get a new console but 2020s factors have made it worse
2020 has been a hell of a year, it’s become tiring to say this incredibly obvious statement. Gaming has been one of the key ways of getting through this pandemic for many people. There aren’t any new movies to go see, you can only watch Breaking Bad on Netflix so many times, and other activities are limited. Gaming has been the one constant and there hasn’t been a shortage of games this year.
Sony was aware the pandemic caused a surge in gaming and as a result, they reportedly doubled their PS5 output. The company reportedly ordered 10 million units to be manufactured in 2020, with 5 million to be produced by September. The other 5 million would be produced through October – December, meaning a chunk of that stock won’t be seen on shelves until 2021 due to the time it takes to ship the units.
The pandemic also led to stores not doing as big of a push for in-store purchases. Many GameStop stores, one of the only retailers doing in-store A lot, if not the vast majority, of pre-orders were sold online with the option of in-store pick-up. This leads nicely into our next two sections.
Deal alerts
PS5 still up at Kohls https://t.co/Oha7bF5gwh pic.twitter.com/DquEKWq5a2
— Wario64 (@Wario64) November 22, 2020
If you’re on social media and are eager for a PS5 or Xbox Series X, chances are you’re following some key accounts. Twitter accounts like Wario64 and Cheap Ass Gamer have their fingers on the trigger. In July, Wario64 had 205k followers on Twitter. On November 7th, the infamous user had 355k. As of the time of writing (November 30th), he now has 666k. His follower count doubled in less than a month.
The reason? Wario64 tweets deals on games from discounts, flash sales, and price errors. Wario has also been the go to source for the second PS5 and Xbox Series X units get restocked. If you look at any of Wario64’s tweets (of which there are many) from the last few weeks, you’ll see people asking about PS5 restocks.
Given the increase in attention to accounts like Wario64’s, it’s safe to say more and more people are fighting each other at a second’s notice for a console. It’s no longer as simple as standing in a line and waiting. It’s just a matter of clicking a link and being lucky enough to load the page quickly and checkout before it sells out.
If hundreds of thousands of people are all fighting over the same link, it’s no wonder they’re selling out before your page even loads.
Scalpers
The biggest factor in the limited availability for PS5 and Xbox Series X is scalpers. These pesky folks have a long history with the online market. Any sneakerhead is familiar with scalpers. Scalpers have been using bots for a long time to snatch up limited edition shoes from retailers like Nike or Adidas. Essentially, when the page goes live, the bot is programmed to instantly purchase it, faster than any human ever could. They rarely ever get just one, though. They usually get multiple, such as the scalper who has 3,500 PS5s.
In the past, scalpers go for limited items because they’re way easier to flip since… well, they’re limited. You can sell someone on an item that can never be bought ever again at a higher retail price. The PS5 and Xbox Series X are limited right now but that won’t last for more than a few more months.
PCMag spoke to a bunch of people in the scalping community back in October, giving some unique insight into the why. To no surprise, it all comes back to the Covid-19 pandemic. The massive increase in unemployment and eviction rate has led to people trying to find ways to get money.
“Lots of newcomers to the community, and some existing members of ours had lost their jobs and turned to reselling full-time while looking for a new job,” said one admin of a reseller group.
PCMag’s same article noted that some people have bought new houses and Teslas with their earnings. An experienced scalper can make $2,000 – $3,000 a month while newbies can rake in a smaller but still notable $500 profit.
Some scalpers have begun getting desperate, though. As the realization sets in that Sony and Microsoft will have regular stock in mere months, scalpers have begun making offers to buy ad time on YouTube channels.
Some have said that these platform holders really don’t care who gets the system because they get money either way but that’s not true. While retailers have nothing to lose, Sony and Microsoft do. Consoles are typically sold at a loss or very little profit and the money is made through games and services. Microsoft has bet big on services like Xbox Game Pass. Sony, on the other hand, has a number of fancy new PS5 games like Demon’s Souls and Spider-Man: Miles Morales.
If consoles are being sold but no one is buying the games or using the services, it’s only eating into that loss for these companies.
Sony has said they’ll have more consoles before the end of 2020 but I imagine it’s still going to be tight. If I were a betting man, I’d say you probably won’t see them regularly available until around spring 2021. If you’re still undecided on what next-gen console you want, our PS5 review is live and our Xbox Series X review is coming very soon.
