The Reasons Why There Is An Xbox and PlayStation Console Shortage

Joel GunnerJul 8, '21

Many of us have heard through the grapevine rumours of why it is so hard to come by a ninth-generation console, but are those rumours true?

It’s July 2021 – 6 months after the fall. The day the world stood still, the day when we couldn’t get our hands on a ninth-generation console. PlayStation 5 boxes selling for £1000, a pristine copy of Ghost of Tsushima waits, gathering dust: chaos. Many of us recognise that consoles are going short without fully understanding why, and where we know the why we might know more about the how regarding the remediation of this situation. This article should tell you all you need to know about the transpiring events.

First things first, this situation won’t be an overnight fix. Whilst some are lucky enough to get their hands on the sought after consoles, the majority will struggle to do so for some time yet. You might speed up the process by registering your interest with us or by assiduously monitoring a myriad of retail websites, but the truth is that it will be some time before this state of affairs is extinguished. The PS4 has thus far, since its release in November 2013, sold 115 million units, the Xbox One, announced at a similar time, sold near 50 million. Neat statistics, but fast forward to today we will find that since their respective releases in early November only 9 million PlayStation 5 consoles and near 6 million Xbox Series X|S consoles have been purchased. Despite seeming like paltry numbers, the ninth-generation consoles are breaking consumer records as we speak. People are buying, but paradoxically this does nothing to help the issue at hand; the fundamental difficulty lies in the semiconductor, an integral element of the CPU/GPU - the digital brain of the console.

Several other (less important) industries have also been afflicted by the semiconductor shortage: automobiles and smartphones are two such examples. The issue isn’t isolated to gaming nor is it isolated to one area of the world: the paucity is an interconnected global situation leaving no country with roads, phone lines and gaming communities (that’s a lot) unaffected. As is often the case, the big boys are first in the lunch queue for what stock remains: Apple, Ford, Samsung, yet even the behemoths are grappling with the production conditions, releasing products late in insufficient numbers like everyone else. Further on down the pecking order we have our old pals, Microsoft and Sony, and this brings us back to our own shared trouble: we can’t seem to find a console.

'The issue isn’t isolated to gaming nor is it isolated to one area of the world: the paucity is an interconnected global situation leaving no country with roads, phone lines and gaming communities (that’s a lot) unaffected.'

What happens when two people want the same limited resource? They share, fight (or both), but in either scenario the finite supply becomes reduced further. The resource in question is the impressive AMD Zen 2 7nm chip, a valuable component for its incredible transistor density and therefore speed and processing power, a necessary attribute for any console aiming at hitting 120Hz or frames per second in 4K rendering with little to no load time; as the Xbox Series X and PlayStation 5 achieves. What happens then when no resources are left? Well, you go on the hunt for something else in hopes that it proves more plentiful! You decide that if you are to wait, you might as well wait for the absolute best. That, ladies and gentlemen, is exactly what Sony are doing as they look to implement 6-nanometre processing chips within the 2022 models of the PS5. Will that help the semiconductor shortage? Probably not, but it won’t hinder it either. Plus, by the time the PS5 has a 6nm chip we might see the situation repaired, meaning the end-product was even more worth the wait.

Ryzen Semiconductor CPU GPU PS5 Sony

As you read this article, you might find yourself asking why Sony and Microsoft are short in chips – can’t they just make their own? In an ideal world these companies would of course produce components in-house, but this world is not always ideal, hence the console deficiency. Here is the long-story put short: Microsoft and Sony contract AMD, a world-leading chipmaker, to produce processing units that keep our favourite consoles running smoothly. The engineers from Sony and Microsoft design the chip, the innovative people down at AMD go about creating it. The issue arises when we realise AMD is a fabless company, meaning that they don’t own the factories and foundries that manufacture the chips in the first place; AMD are the middle man. The artist you hire to paint your beloved pet is little but cogitations without a pencil, that is the pencil that they cannot themselves make. AMD outsource their needs to a huge corporation named TSMC, Taiwan Semiconductor Manufacturing Company, in order to turn raw materials and blueprints into physical copies that they can then ship to Sony and Microsoft, who will implant the components, ship the package our way then allowing us to finally use it to play Ratchet and Clank: Rift Apart. TMSC, as well as Intel and Samsung, are the globes largest manufacturer of semiconductor chips, yet even the big three cannot keep up with demand; Samsung still had to delay multiple releases of new devices as a result of the global shortage.  

'Taiwan Semiconductor Manufacturing Company, as well as Intel and Samsung, are the globes largest manufacturer of semiconductor chips, yet even the big three cannot keep up with demand.'

So, we have the context, let’s explore a few other exacerbating factors, the reasons why the semiconductor stocks are short in the first place:

Booms and Busts

Industries, notably the automobile sector, initially forecasted a significant downturn in sales resulting from the COVID pandemic, therefore then dramatically halting production. As it happens these predictions did not come true, at least not in the long-term, so when production ramped up again a glaring problem arose: the resources Ford, General Motors and Volkswagen, amongst others, had utilised previously were now diverted to the areas experiencing an uptake in sales: the devices enabling the world to work from home. The same can be said for the gaming world, left without supplies.

The Worldwide Lockdown

Although the world gradually shut-down and closed its curtains for a few months, the business environment had to sustain itself; humans had gone socially subterranean whilst the economy pressed on. In order to marry the two affairs, we had to take millions (if not billions) of people from the office and transfer their technological abilities to their living room: a huge, huge task. We carried out the switchover remarkably well, but not everything survived: the semiconductor supply being one. In many of the devices used to facilitate a working-from-home environment lay our now-idolised semiconductor, performing basic computer functionalities instead of running FIFA 2021 on the Xbox Series X.

COVID Supply Line Issues

Stemming from the myriad of COVID-safe rules and regulations was an interrupted, glitchy supply line. Transferring materials to foundries, components to companies, products to retailers and units to consumers became an irksomely elongated process. Planes were grounded, the waters of shipping harbours lay inert as ships floated in a state of repose – the world came to a grinding halt. I remember seeing pictures of the crystal clear canals of Venice, the empty streets of London, all void of activity – and where there is no activity there is no delivery of semiconductors let alone PlayStation 5 consoles. Worse still, international crises such as the Suez Canal blockage aggravated further an already irritated supply chain, severing huge manufacturers, like Malaysia, China and Taiwan, from the corporate bigwigs and consumers in Europe.

Hoarders and Scalpers

As the ninth-generation console first came out, I remember swathes of Reddit users in an uproar regarding the so-called ‘Scalper’ activity: members of the public that bought up a collection of consoles whilst they were on the market so as to sell them on at higher prices, sometimes extortionately so. Those of us either unable or unwilling to stump up such inflated sums simply went without, and that is that.

Surges in Cryptocurrency Mining

The contemporary reincarnation of the Gold Rush lies in the cryptocurrency phenomenon, a group of digital assets used today to exchange goods and services. To mine and electronically unearth cryptocurrencies, like the revered Bitcoin, you need some hefty equipment – not just the equivalent of a crypto-spade; you need computing power, the ability to process large swathes of interactions and calculations. And guess what will enable you to do so? A swanky GPU, which houses a similarly proficient semiconductor. At some points throughout 2020 the percentage of total semiconductors purchased from TSMC by crypto-miners alone hovered around 10%. Nvidia chips, which you can find within the Nintendo Switch series (including the OLED Model), chose to reduce the mining efficacy of their chips by half, impeding any minor end-user crypto-mining operations attempting to subsidise a GPU purchase by doing so. More, a development since coming from Nvidia is it's production of CMPs, Crypto-Mining Processors, a product range still using semiconductors but directing. On the other hand, AMD chips, which Microsoft and Sony opts for, chose not to follow suit, a decision that doesn't help our console woes. Crypto-mining is therefore, at least in the wider sense, liable of contributing to the global semiconductor deficit.

Bitcoin Cryptocurrency CPU GPU Semiconductor

Political Instability

What is popularly dubbed a Tech-War continues to develop between the US and China in a novel form of the Arms Race now focused on creating the best consumer technology possible. Inevitably undeterred by the competition, both superpowers rely on one another to produce, to buy and to nourish their respective economies so when one side imposes a sanction on the other hell tends to ensue. As the US reprimanded China via a series of trade restrictions, a group of corporations dependent on semiconductor commerce foresaw the incipient instability and decided to ‘double-book’ their stocks, leaving a diminished collection for the rest of the world to function on. It goes without saying that Sony and Microsoft did not, or were perhaps unable to, double book semiconductor stock and hence the shortage in consoles.

Today’s semiconductor situation is not likely to be much different to yesterday or tomorrow, but in due course we should begin to see a incremental trend of improvement. Whilst not all factors irritate the gaming industry directly, Governing bodies across the globe are offering subsidies and generating investments into the creation and expansion of semiconductor foundries, US President Joe Biden for example signed an executive order back in February 2021 in an effort to ‘strengthen supply chains.’ That's a huge deal with even greater ramifications. In reality, not every step will be forwards: the Japanese Renesas factory blaze in the March of 2021 debilitated the recovery of the automobile industry for months following, but generally the news is of good nature - the tide looks to be turning.  Making headway in in the geo-economic sphere takes time; factory enlargement is a lengthy process and supply chains are like wounds: they take time to heal. In the meantime, you can register your interest here for the PlayStation 5 and here for the Xbox Series X|S so you do not risk missing out when the time comes!

Written by Joel Gunner

Images sourced from Pierre Borthiry, Infralist, Olivier Collet and Andre Francois Mckenzie on

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