One of the bigger surprises from the PS5 reveal event was the announcement of the PS5 Digital Edition. The console doesn’t feature a disc drive and will only support game downloads.
A disc-less console isn’t something that many were expecting from Sony, which had done a good job of keeping it under wraps. There have been many reports about Xbox Project Lockhart , a weaker, disc-less version of the Xbox Series X, but there had been no rumors about the PS5 Digital Edition.
The PS5 Digital Edition is an incredibly smart business move from Sony. In 2019, digital game spending hit $109 billion , including digital game sales and in-game purchases such as loot boxes.
In 2018, Sony also confirmed that 43% of full game sales in Q1 FY2018 were digital game sales. $2.4 billion was spent on all games during the quarter, meaning that digital game sales made $1 billion. The industry standard cut from each game sale is 30% meaning that from one quarter alone, Sony made $300 million from PlayStation Store game sales.
This revenue will only grow exponentially with the release of PS5 Digital Edition. It will also help to push players to services such as game streaming subscription PlayStation Now. Services like this bring in recurring revenue and can help foster platform loyalty. At a time when Xbox is going big with services like Xbox Game Pass, Sony needs to fight back.
However, while the PS5 Digital Edition is a major part of Sony’s digital gaming strategy, it could end up being a bad deal for gamers. Gamers may find themselves in a bind when trying to get free PS5 upgrades for PS4 games, upgrades that are supposed to save them money.
Only a few publishers have confirmed their PS4 to PS5 game upgrade plans. Today, CD Projekt RED said the PS5 version of Cyberpunk 2077 would be free to anyone who buys the game on PS4. There are more issues though with publishers such as EA.
After being criticized for its Madden NFL 21 upgrade program, EA did extend this, giving gamers longer to get an upgrade. A remaining issue is that gamers who buy a physical version of Madden NFL 21 or FIFA 21 on PS4 cannot get an upgrade for a PS5 Digital Edition.
Gamers can get a free PS5 upgrade for these games if they buy digital versions on PS4 but the PS4 has a frustratingly small SSD that means this isn’t ideal. If other publishers choose to build their free upgrade systems around this idea too, it could make the PS5 Digital Edition more of a headache than a money-saver.