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CHIPS ARE DOWN

Why you still can’t get a PS5

sony ps5 inside a gamestop store
Reuters/Carlo Allegri
So close, yet so far.
  • Adam Epstein
By Adam Epstein

Entertainment reporter

Published Last updated on

More than 6 million consumers have secured a PlayStation 5 since Sony’s next-gen gaming console launched in November. Untold millions more have tried and failed. That’s because—for a variety of reasons well outside the average consumer’s control—buying a PS5 is more challenging than any of the games they can play on one.

The very existence of the $500 console ($400 without a disc drive), along with Microsoft’s next-gen Xbox series X and S, is but a mere rumor for most consumers—a whisper in the night. They often go days or weeks without being seen in stock online or on store shelves. Then, suddenly, they will appear on Amazon, Target, Best Buy, or Walmart. But if you happen to be on a call or running an errand when the stock goes live, you have virtually no chance of securing a unit. They sell out within minutes.

Sony’s website, in the rare instances it has PS5s to sell, uses a virtual queue system that’s become infamous for putting consumers in hourlong virtual lines only for them to be told, sorry, the consoles sold out long ago. There is scant evidence that tricks spread online could increase your odds of securing a console: opening sites in multiple browsers on different devices, having all of your shipping information saved, refreshing constantly, having lightning-fast fingers. Some Twitter accounts have popped up that are devoted entirely to notifying followers when consoles are in stock somewhere on the internet. Even using all of these techniques, it’s extremely hard to purchase a PS5. It’s impossible to do so for more casual consumers.

The reasons for this are many, and they cover everything from the Covid-19 pandemic to the shipping industry to Donald Trump. But the biggest culprit of all is the state of the global semiconductor industry.

Global chip shortage

Sony and Microsoft can’t make more consoles available to consumers because crucial components are in short supply: chips. The PS5 and the new Xbox both run on chips from Advanced Micro Devices (AMD), an American semiconductor company. But, like many semiconductor companies (Intel, Nvidia, Qualcomm being some others), AMD only designs the chips—it doesn’t actually make them. It outsources production to Taiwan Semiconductor Manufacturing Company (TSMC).

TSMC, which manufactures much of the world’s computer chips, can’t keep up with the demand created by consumers trapped in their homes all day during the pandemic. Sony and Microsoft aren’t just competing with each other for access to parts—they’re also competing with any company that sells devices that use semiconductors, from personal computers to mobile phones.

The semiconductor industry generated $440 billion in sales in 2020, a 7% increase from 2019. This year, it’s expected to increase another 11% to $488 billion, according to World Semiconductor Trade Statistics.

On top of the existing chip shortage, cryptocurrency miners are exacerbating the issue by buying up all the inventory and driving up prices for certain chips, like Nvidia’s graphics cards. The PS5 and Xbox don’t use Nvidia cards, but millions of PC gamers do. And they’re being squeezed out of upgrading their machines by faster, richer crypto junkies. Nvidia’s chips can be used to do the complicated computations necessary to mine new digital currency.

Shipping crises

The pandemic has put an enormous strain on global trade, slowing supply chains and delaying production at factories around the world. It’s fair to assume this has had a nontrivial impact on Sony’s ability to manufacture and sell Playstation consoles. The New York Times reported that demand for goods has vastly outstripped the current capacity that shipping containers are able to transport from one country to another.

Ripple effects from the container shortage on the gaming industry could be felt for years. Additional stress was added when the ship Ever Given ran aground in the Suez Canal, blocking the vital shipping lane for a week and holding up nearly $10 billion worth of goods each day. It’s unclear if the PS5 supply chain was effected—but it couldn’t have helped.

Trump’s trade war

In September of 2020, former US president Donald Trump and his commerce department imposed new restrictions on China’s top chip maker, Semiconductor Manufacturing International Corporation (SMIC), as part of his trade war against the country. The restrictions barred US companies from exporting certain technology to SMIC without a license, the Wall Street Journal reported, out of fear that it would use the tech for military activities. (SMIC says it only sells semiconductors to civilian and commercial users.)

As a result, SMIC hasn’t been able to produce chips for companies with US ties—placing an even greater burden on competitors like TSMC they don’t have the capacity for.

Bots and scalpers

So we’ve established Sony doesn’t have the parts they need to make enough PS5s. But buying the consoles the company does manage to make is still a nuisance because of bots, scalpers, and scammers who buy up all the inventory faster than any reasonable human can do. E-commerce sites have tried putting some measures in place to prevent bots from scooping up all the units, but that so far hasn’t stopped nefarious parties from finding workarounds. If you really need a PS5 but can’t wait, you can always try buying on the re-sale market, where units can go for as much as three times the normal price.

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