Earlier quoted context omitted.
This exactly. The PS5 and Xbox One X are commodity PC hardware, optimized for gaming, packaged with a curated App Store. Sony also won’t just sell you hundreds or thousands of them for some kind of groundbreakingly cheap cluster. They will say no, unless you’re GameStop or Walmart. Everyone with a high-mid-range PC already has more horsepower than a PS5 and it’s not doing anything particularly innovative or groundbre…
I think you've vastly understating current hardware prices. An 8 core 2nd generation Zen chip appears to retail for $290. The PS5 reportedly has a custom GPU design, but for comparison a Radeon 5000 series card with equivalent CU count (36) currently retails for $270 minimum. Also, that GPU only has 6GB GDDR6 (other variants have 8GB) but the PS5 is supposed to have 16GB. And we still haven't gotten to the SSD, PSU,…
I think console hardware cost is generally budgeted at a slight loss (or close to break-even) at the beginning of a console generation, and then drops over the ~7 year lifespan.