Is the Console War Finally Over?

PlayStation or Xbox? It’s the long-running question of the modern video game world. At one point or another in your life, you’ve almost certainly been a part of this debate. Maybe you’ve started a Reddit thread, or made a TikTok video, or struck up a heated chat between friends about it. While there are gamers who preach the PC gospel, and Nintendo-as-god fanatics, much of the last two decades of video game history has been made as a result of Sony and Microsoft’s ongoing tete-a-tete. But is this ‘console war’ truly still being waged? The video game industry has gone through immense change in the last year, let alone over the previous two decades. Gamers’ habits, preferences, and options have all increased exponentially in part thanks to the rise of handheld gaming and younger generations’ expertise in building their own gaming machines. The battlefield is now practically unrecognisable compared to its tribal-like origins, but has a victor finally emerged from the trenches? Possibly – but the answer may surprise you.

The video game industry has rapidly evolved to become a financial juggernaut in recent years. In 2019, its worldwide revenue was $285 billion. Last year, it was $475 billion. That figure means that video games made more than the entire world wide movie and music industries in 2023, which made $308 billion and $28.6 billion respectively. There’s no sign of this growth stopping, either. By 2029, the industry is estimated to generate nearly $700 billion. Not bad considering its humble Pong origins.

All this considered, it’s no surprise that we’ve seen an uptick in Hollywood actors flocking to be a part of a scene with such a lucrative present and future. Mads Mikkelsen, Keanu Reeves, Jon Bernthal and Willem Dafoe to name a few have all starred in games released in the past five years. Their involvement reflects the monumental shift in the perception of video games. Even industry titans like Disney are making significant in-roads into gaming, having just invested $1.5 billion into Epic Games as part of Bob Iger’s second term challenge to solidify a gaming presence for the company. A rising tide should lift all boats – unless you’re aboard the U.S.S. Microsoft, which seems to have sprung a leak.

The Xbox Series X and S consoles are intended to be an upgrade from the Xbox One in every way. But their advancements have yet to prove truly enticing; the One currently ranks above the Series X/S by almost double the sales. When you couple this fact with comments from analytics company Circana’s games industry expert, Mat Piscatella, who has suggested that this current console generation is now past its selling peak, it paints a worrying picture for team Xbox. Things appear even worse when you look at console sales figures from 2024. According to Statista, the Xbox Series X/S sold less than 2.5 million units across the entire year – the PlayStation 5 sold the same figure in the first quarter of 2024 alone. There are also the allegations that Xbox is supposedly closing down its department which handles the manufacture and delivery of games to physical retailers, which feels ominously connected to its evasive response to a report that it plans to pull out of selling consoles in the EMEA region. If Xbox really has been involved in a ‘console war’, all of this points to the signal to retreat.

But Xbox isn't retreating – it has already surrendered. During the long Activision-Blizzard acquisition process, a statement from Microsoft found in the findings of fact revealed that the company doesn’t believe its Xbox division lost the console war – it thinks it never had a shot to begin with. So, what does a company built around a video game console do when its newest model is struggling to match its predecessor in sales, and its parent company openly remarks on its failure? It gets out of the console business.

It's no secret that Xbox Game Pass has become a key priority for the company. Leaked internal documents revealed the estimated prices Xbox expected to be asked to pay to put AAA-titles like Grand Theft Auto 5 ($12-15 million per month) and Star Wars Jedi: Survivor ($300 million) on the subscription service. Xbox taking such costs seriously demonstrates the company consolidating cloud gaming as a key direction for it moving forward. That goal is clear to see in Microsoft’s recent ‘This Is An Xbox’ advertising campaign, which suggests the company is keen to redefine how players think of Xbox – no longer a console, but an always-accessible service with some hardware to complement it instead.

It seems like this rethinking of what an Xbox is means that the brand’s official hardware won’t be limited to being a box under your TV. An Xbox handheld has been rumored to be in development for the past year or so, backed by another leaked document from the Activision-Blizzard dealings which hints at using handheld-friendly hardware for a next-gen 'hybrid cloud gaming platform'. But Microsoft’s pivot in strategy has hardly been a secret. From its announcement of plans to create a mobile game store to compete with Apple and Google, to Xbox chief Phil Spencer’s own admission that mobile gaming’s dominance in the sphere is shaping the company’s own path moving forward, the new M.O. seems simple: Xbox is the video game brand you can play whenever you want, wherever you are.

So why is Microsoft pivoting? Sure, Xbox has struggled over the past couple of generations, but doesn’t the video game console market reign supreme? You’d be surprised. In 2024, of the total 3.3 billion estimated video gamers, over 1.93 billion of them play via a mobile device. That, of course, includes your grandmother playing Candy Crush Saga and your “non-gamer” cousin who still clocks up hours of Clash of Clans. But mobile gaming is now so much more than these casual audiences – over the last decade it has quickly become the dominant pillar of the video game market among every generation, but especially Gen Z and Gen Alpha. In 2024, the total market valuation for the video game industry was $184.3 billion, with mobile games comprising exactly half of that entire figure at $92.5 billion (a 2.8% increase from the previous year). Where do consoles weigh in? At just $50.3 billion, or 27%, and that’s dropped 4% since 2023. No wonder Microsoft wants to turn your phone into an Xbox.

But this isn’t a new development. By 2013, the Asian market for mobile gaming was already dwarfing that of the western world by heights of 759% in South Korea and 280% in China. You might think GTA 5 was the most profitable game of 2013, but you’d be wrong: Both Puzzle & Dragon and Candy Crush Saga outperformed Rockstar’s juggernaut by $1.5 and $1.4 billion respectively. Take a wide-angle lens to the 2010s as a whole for video games, and you’ll find that five of the highest-grossing games were mobile games – Crossfire, Monster Strike, Honor of Kings, Puzzle & Dragon, and Clash of Clans. When you look back on the decade, I highly doubt any of these titles immediately spring to mind – and yet, I’m sure most reading this have the start-up music for Clash of Clans seared into their brains.

Phones are not the only platform drawing attention away from consoles. While not as significant as mobile gaming’s explosion, it’s clear to see that player habits have shifted toward a greater appreciation for PC gaming. Since 2014, there has been a year-on-year growth of 59 million new PC players, taking us from 1.31 billion in 2014 to 1.86 billion in 2024. It’s worth noting this rise is complimented by a gargantuan 200 million in 2020 due to the COVID pandemic, during which streaming became a very attractive pastime for many house-bound players. But regardless of if Twitch called to them or not, gamers have become more technologically literate, educated by their peers online on how to build a PC powerhouse, what the best GPUs are, and how to overclock your circuit-ware. As a result, the PC’s global share of the video game market in 2024 lands at $41.5 billion – so it won’t be long until the PC battleline overtakes the army of console players, right? Well, maybe not. Netzoo’s 2016 Global Games Market Value report defined a $2.3 billion gap between console and PC – but in 2024, that gap has increased to $9 billion. So despite the rise of more advanced GPUs, circuit-boards, and Gen Z and Alpha’s technological craftiness, it’s a market that’s on the fall rather than the rise – at least for now. If that fall continues, it's not great news for Xbox, which has made Windows PCs its second home.

But it’s not just the dominance of mobile and the uncertain future of PC that Xbox has to contend with. Wars typically have two opposing sides, so it’s about time we looked at where PlayStation fits into this console war. Luckily for Sony, things are going pretty well. In its latest quarterly earnings report, Sony revealed 65 million PS5s have been sold to date – that’s a big lead ahead of the combined 29.7 million sales for the Xbox Series X/S. To break that down, for every one Xbox Series X/S bought, five PlayStation 5 consoles are also purchased. Sony’s Game and Network Services also saw a healthy 12.3% bump in its profits, helped specifically by healthy first-party sales including Astro Bot selling 1.5 million copies in under two months, and lifetime sales for Ghost of Tsushima Director’s Cut surpassing 13 million. The future looks very bright for the PS5. Ampere Analysis’ games research director, Piers Harding-Rolls, estimates that by 2029, Sony will have sold 106.9 million consoles. How do things look for the Xbox Series X/S’s future? Well, leaked Microsoft documents estimate that by 2027, it expects to have sold around 56-59 million units. While it’s not a directly comparable projection, it’s not good. In order for Microsoft to re-establish its competitive edge in the current market, it will need to close the 5:1 PlayStation-to-Xbox gap, significantly increase the number of units sold year-on-year, and also bolster the profitability of its exclusives. Projections don’t support a positive outcome for those first two requirements, and given Phil Spencer’s ‘no red lines’ mantra on Xbox titles coming to PlayStation and Switch (possibly even including the next Halo title), the argument could be made that PlayStation is already the King of Console.

But looking at the PS5 in isolation paints a different picture. 50% of all PlayStation users are currently still playing on older PS4s instead of PS5s, despite the newest generation now entering the second half of its life-cycle. Why is this? Well, of the top 20 best-selling games in the U.S. in 2024, only one is truly PS5-exclusive – Marvel’s Spider-Man 2, at #19. Helldivers 2 does feature at #3 but was also playable on PC at launch. Looking beyond last year, if we disregard remasters of PS4 games, there are roughly 15 genuine PS5-exclusive games on the console as a whole. There’s little here to justify the console’s price in many people’s eyes.

If the PS5 is struggling to justify its regular $500 price tag, then it's understandable why the $700 PS5 Pro debuted to a mixed reception to say the least. The general consensus amongst tech journalists is that perhaps this upgrade came too early within the cycle, especially given the games advertised in its campaign were slightly upscaled generation-old remasters. When IGN polled its readers, the result was overwhelmingly clear – the PS5 Pro has little to offer for forking over that much cash. So, simply put, the PS5 simply isn’t a must-buy console – at least, not yet. This will undoubtedly change when the behemoth that is Grand Theft Auto 6 finally releases later this year, which is almost guaranteed to become the shining star of this generation and the first chance for the PS5 to show off its true power.

So, is the console war over? If you’re Microsoft, it would appear there was never any belief that there was a chance to battle Sony for supremacy. If you’re Sony, your new console has become a success but lacks the true pedigree to be claimed as a new leap forward yet, feeling more like a bunny hop than anything else. The true winner of the console war seems to be those who chose not to play it at all. Rumors of mobile gaming companies encroaching onto the traditional console gaming sphere will only ramp up in the years to come, with Tencent rumored to be in talks to buy out Ubisoft from the Guillemot brothers, having already purchased Sumo Group in 2021. Mobile gaming is becoming increasingly pivotal to the sustainability and profitability of these companies – Take-Two Interactive claim that 10% of the world’s population plays its subsidiary Zynga’s games every month. That means that it’s more than likely that your grandma playing Zynga Poker and Words with Friends 2 is funding the continued development of Grand Theft Auto 6 – not a sentence you would expect to read five years ago, but one reflective of the new state of play of the video game market. The next five years of video gaming history will be defined less and less by who has the most powerful hardware, and more about whose cloud gaming server farm can expand the quickest and strongest. The console war is over, but the mobile gaming war (and the myriad of smaller conflicts that inevitably spin out of it) has only begun.

Sab Astley is a freelance writer who has written for IGN, Polygon, TotalFilm, Rolling Stone, Radio Times, and Metro UK.