Intel reportedly lost a PS6 deal worth $30 billion to AMD, with Sony eyeing next-gen backwards compatibility
On the heels of the PS5 Pro reveal, new traces of the PlayStation 6 suggest Sony is once again eyeing backwards compatibility and tapping AMD to power its consoles.
Reuters reports that, in 2022, Intel lost the contract to provide chips for the PS6 to AMD. Intel reportedly internally valued the contract, which would’ve seen lower profit margins than some chip deals but importantly would have secured steady sales for the company, at “roughly” $30 billion.
It’s unclear how this figure was calculated, but just as the PS4 outsold the PS3, PS5 sales have trended ahead of the PS4, both in general and in many regions at several points. For total sales, PS5 is still roughly 26 million units behind PS4, but that’s largely due to its relative newness as well as a launch slowed by supply issues caused by pandemic-related production bottlenecks. In other words, though the shape and nature of the console market remains to be seen, Intel had reason to be optimistic on PS6 valuation here.
One key point in Intel and Sony’s discussions was backwards compatibility. The PS5 also uses an AMD chipset, as does the Xbox Series X, which means sticking to AMD for the PS6 would simplify the process of enabling backwards compatibility. This was a key selling point for the PS5, which supports the vast majority of PS4 games. This was also “a subject of discussion between Intel and Sony engineers and executives,” Reuters reports, though it seemingly wasn’t the detail that buried the deal. Rather, Intel apparently wanted a larger chunk of each chip sold, leading to “dispute” with Sony and leaving the door open for a more competitive bid from AMD.
Backwards compatibility has been discussed more heavily as new consoles, like the Xbox Series S and now the PS5 Pro, have phased out disc drives in favor of cheaper, all-digital form factors, sometimes with external disc drives available standalone (and often at a premium). Console game sales have been trending digital for many years and the hardware has followed suit. This has drawn a line between backwards compatibility and disc compatibility.
That said, there’s currently no hard evidence that PS6 or the next Xbox will do away with discs entirely, though it wouldn’t be surprising to see external disc drives become more normalized. Earlier this year, Xbox boss Phil Spencer stressed that “we are supportive of physical media” even if “a majority of our customers are buying games digitally.”