People who say “it was never the case” are misremembering history.
Yes, consoles are sold at a loss initially. However, the price-to-performance ratio (in terms of frames per second) consistently decreases over time, regardless of what console manufacturers do.
For example, the original PlayStation was released in 1994 at a cost of $600. By the end of 1999, just six years later, you could emulate its games on a fairly inexpensive, older PC. In 1994, while the first Doom ran on a relatively costly i386/i486, it was impossible to match the arcade-quality graphics of PlayStation games like Tekken 1 to 3. However, by the time the PlayStation 2 was released, it became feasible to use an affordable older PC with a low to mid-range GPU to exceed the graphical capabilities of any console available at that time.
The only period when consoles were truly cheap—meaning they were sold at a loss—was during the first few months after their release. If you already owned a PC, you could easily surpass the performance of newly released consoles by simply upgrading your GPU.
People who say “it was never the case” are misremembering history.
Yes, consoles are sold at a loss initially. However, the price-to-performance ratio (in terms of frames per second) consistently decreases over time, regardless of what console manufacturers do.
For example, the original PlayStation was released in 1994 at a cost of $600. By the end of 1999, just six years later, you could emulate its games on a fairly inexpensive, older PC. In 1994, while the first Doom ran on a relatively costly i386/i486, it was impossible to match the arcade-quality graphics of PlayStation games like Tekken 1 to 3. However, by the time the PlayStation 2 was released, it became feasible to use an affordable older PC with a low to mid-range GPU to exceed the graphical capabilities of any console available at that time.
The only period when consoles were truly cheap—meaning they were sold at a loss—was during the first few months after their release. If you already owned a PC, you could easily surpass the performance of newly released consoles by simply upgrading your GPU.