PS5 vs Xbox Series X: Is Microsoft or Sony best placed to win the $160bn console war?

Sony is predicted to sell 66m consoles by 2024

PS5 playstation 5 launch uk
The latest PS5 has arrived in the UK Credit: Sony

It was 1993 when the console wars between video game giants turned bloody. That was the year when Mortal Kombat, a martial arts fighting game, was launched on two different consoles by Nintendo and Sega. At the time, the two fierce Japanese rivals were  locked in a bitter battle for control of the console industry.

Sega, the smaller of the two,  came up with a unique way to hit back at Nintendo, its family-friendly adversary, by inserting a special "blood code" into its own version of the fighting game.

To maintain its squeaky clean image, Nintendo had removed all blood and gore from its version of the infamous fighting game. However, Sega's  interpretation of Mortal Kombat allowed players to fight with plenty of blood, gore and and a splatter of body parts - a ploy which proved wildly popular, especially among younger gamers. 

It was only the launch of the Playstation in 1995 that saw Sega’s dominant era brought grinding to a halt. Nearly 25 years later and the cut and thrust of the console wars has not stopped. 

Two of the world's biggest companies have put the final touches to two key new consoles, which have launched into a market that has been given a huge boost by the Covid-19 lockdown. With billions of people cooped up indoors for months on end seeking distractions - with no sports or alternative diversions - Sony and Microsoft are hoping for blockbuster sales.

On 19 November, Sony's PS5 finally went on sale in the UK. It is up against Microsoft and its Xbox Series X. Both devices arrive just before Christmas in an attempt to entice gamers for the next generation of devices. 

Both consoles are massive, packed with powerful hardware and with cutting edge graphics. But which is best placed to win the latest bout of the console wars?

Sony’s Playstation and Microsoft’s Xbox have vied for dominance for almost two decades now. Launched in 2000 PS2 was a generation-defining console with sales of more than 150 million. The Xbox 360, launched in 2005, put Microsoft back on level terms with Sony - with sales of 85 million. 

The PS4, originally released in 2013, outsold Microsoft’s competitor Xbox One two-to-one with more than 100 million units, securing its current status as the market leader.

The global gaming market is forecast to exceed $160bn this year, according to analysts Newzoo. The new consoles represent only a slice of this, with mobile gaming growing fast among casual users.

The impact of coronavirus has, until now, supercharged games sales in 2020. Reported UK lockdown sales of current PS4 and Xbox consoles more than trebled in the first half of the year.

Sony edges ahead

Of 2.7bn gamers worldwide, there are around 100m users of Playstation’s console systems, and just under 100m on Microsoft’s Xbox Live. But those players make up a substantial part of gaming revenues, with Newzoo estimating console games were worth around $49bn in 2019.

Ahead of its launch, the PS5 had an edge.

“Sony understands the concept of locking people in with hardware,” Richard Windsor, a technology analyst at Radio Free Mobile, said earlier this year. This means enticing users with exclusive games that only work on its new PS5 console. It is planning 28 exclusive games on launch.

Jim Ryan, chief executive of Sony Interactive Entertainment, told The Telegraph in an exclusive interview last week: “We like making big blockbuster games; that's what we do at PlayStation.”

The PS5 is due to have the biggest exclusive games on its new console thanks to coronavirus. Spider Man: Miles Morales, an updated Grand Theft Auto 5 and racing game Gran Tourismo 7 are all “triple A” games.

Spider Man: Miles Morales - a triple A game coming to PS5 Credit: Insomniac Games/Sony

Microsoft, on the other hand, has backed down from a strategy of big hitting releases exclusive to its new console. While it will still carry some big titles not available on Playstation, such as space saga Halo: Infinite, users will also be able to get these on older Xbox consoles and PC. 

Instead, it has geared its Xbox Series X, released earlier this month, towards letting players enjoy updated versions of games from as far back as 2002. 

Perhaps more than any previous iteration of the two consoles, the PS5 and Microsoft’s Xbox Series X are embracing divergent strategies. 

Microsoft’s innovations include new silicon chips to improve older games and allow them to run them smoothly with better resolutions and frame rates on modern consoles.

Long-term Xbox strategy

Its longer term strategy is also more aligned to its Silicon Valley peers. The tech firm is focused on a future of “cloud gaming” - from the design and development of games up to using its Xbox Games Pass for users to play games in a Netflix-style subscription service. The ultimate idea is to reach billions of people who do not use high-powered console games by doing more processing in the cloud.

But while Microsoft has the Silicon Valley vision, Piers Harding-Rolls, a video game expert at Ampere Analysis, told The Telegraph earlier this year Sony’s view on video game console strategy has been more pragmatic, and so far ultimately more successful.

“Sony is realistic about the market now and very focused,” he says, “but Microsoft has sometimes lacked that focus. Its longer term ambition is to reach a broader audience.” 

He adds cloud gaming is unlikely to break through into the mainstream until around 2024. Xbox’s Game Pass cloud gaming service only has 10 million users, while Sony’s Playstation Now has just 2 million. 

The Xbox Series X Credit: Microsoft

And while Covid-19 has so far had a positive impact on gaming, Ampere estimates a broader recession will slow down adoption of the latest consoles, in particular in 2021. 

How will this play out? Going into the latest generation, analysts believe Sony will maintain the status quo. According to Ampere's data, Sony and Microsoft will both sell under 5m consoles of the PS5 and Xbox Series X in the Christmas quarter this year, but by 2024, Sony will have outstripped Microsoft again by selling 66m units to Microsoft’s 37m. 

Windsor, of Radio Free Mobile, notes Microsoft’s botched launch of its old console has left it with a lot of ground to make up in 2020. “The old Playstation largely outsold the Xbox because of Microsoft’s horrendous blunders back in 2013,” he says. “However, they have learnt from that mistake.”

While last time Sony undercut Microsoft by around $100, this time both devices are expected to come in at between $450 and $500.

For all Microsoft’s efforts to focus on innovations, Sony’s slew of exclusive games have left the Xbox Series X very much the underdog in this round of the console wars.

Which console will you be purchasing and why? Let us know in the comments section below.